When Nell Williams was the director of revenue management responsible for the 400-room Long Wharf Marriott in Boston, there were certain days of the week-Wednesdays, Thursdays and Saturdays-when she could easily sell out the hotel twice over. But on other nights, like Sundays, occupancy rates dipped so dramatically that she would've been lucky to have filled the rooms three times a year.
Both situations presented challenges for Williams, whose job was not just to sell rooms but to sell them in such a way that would make the most money for the hotel. She used a combination of pricing and inventory controls to maximize profits. On the high-demand nights, she had to be careful not to sell out early at low rates. She also had to consider lengths of stay. There were plenty of business travelers wanting to stay one night and willing to pay top dollar. But those customers would not help her fill the hotel on less busy days the way a three-night stay might. Meanwhile, on Sundays, she needed enough rooms available at the lower rates to attract customers, but not so many that she might give rooms away to someone willing to pay more.
Back then (some 17 years ago), Williams and her counterparts tackled these challenges on an ad hoc basis, with only homegrown statistics and their wits to help them decide what rates to offer to any given customer. Such prognostication took up the better part of her day.
Today, Marriott's revenue managers can do the same work in less than an hour thanks to One Yield, an enterprisewide system that automates the business processes associated with optimizing revenue for more than 1,700 of the company's 2,600 properties. Unlike earlier systems that attempted to tackle this seminal issue of the hospitality industry-that is, maximizing the revenue for every available room-One Yield takes most of the guesswork out of setting rates by providing recommendations to Marriott employees about what rates to offer at any given property on any given day. The system has enabled the $9 billion company to extend its competitive advantage at a time when many of its peers were struggling just to survive.