Nov 22nd 2015 by VegasRateReddit • 54 Questions • 757 Points
I recently just left a job in revenue management with a large hotel/casino/entertainment company here in Las Vegas that has multiple properties on The Strip. Each property averaged from 2,000 to over 5,000 rooms!
My main job was to set the hotel room rates at these properties to ensure we maximized revenues.
I also worked with marketing departments to create promotions (the "Book Now and Get 20% Off + $50 F&B Credit!"), the casino departments for setting comp rates, hotel operations, and online travel agents (Expedia, Orbitz, etc).
To Get the best deal on a hotel room in Vegas, try this:
- Google your hotel name and then "Promo code" (i.e. "Caesars Palace promo code")
- No luck? Try the hotels Facebook page or Twitter accounts.
- Book directly though the hotels website! BOOK DIRECT! BOOK DIRECT!
- Use your players card anywhere and everywhere it's accepted.
- Be nice to the staff when checking in and during stay - seriously. We keep comments about you.
- Keep in mind we have resort fees for every hotel on the strip. Revenue Management loves them, everyone hates them.
Fun Fact, we make mistakes sometimes.
My Proof: http://i.imgur.com/RAjFUP1.jpg plus verification from the Mods.
So, Ask Me Anything!
EDIT: Im following a recipe from r/slowcooking so I got plenty of time. Keep em coming.
Did you ever make mistakes the other way, like posting rooms for $1.07, and if so did the property honor those rates? On average, what percentage of room inventory is usually booked vs. sitting empty?
Mistakes are made constantly! We also audit constantly to catch them.
My worst mistake was setting a suite to $66/night for Friday and Saturday over EDC Weekend. The rate should have been $660. It wasn't caught until the next day. Because it went out to our OTA's, over 1,000 reservations came in for that suite - that hotel didn't even have 1,000 of that room type. When those guests checked in, they were most likely moved to a lower level room with inventory. However, we will try and accommodate.
It totaled over $120,000 in lost revenue.
Rates won't go out that low. We have some parameters in place to prevent that. For example, the hotel that I screwed up - the lowest possible rate at that hotel was $55 - so they system didn't catch a $66 rate. Anything below $55 wouldn't have gone out.
How did you work your way into hospitality revenue management in Vegas? Kudos to you for doing so in such a competitive town in terms of that industry!
Vegas is a very competitive industry - especially Revenue Management. Revenue Analysts jump all over the city though, so it's a very small group of people who know each other.
I was a hotel engineer before! I went to room calls and fixed things.
RM is about problem solving really, and I learned how to trouble shoot from engineering.
I also met a high level executive on Grindr and talked with him for months - which I believe may have helped me. I never met him until I started the job.
Why don't the hotels cater to locals (or do they?) in an effort to get better viral marketing? I travel quite a bit for work, and every time I get on a plane to come home, the person sitting next to me immediately start asking me for recommendations for shows to see, hotels to stay at etc.
We do market to locals, and all of our hotels have local discounts. Vegas locals get room discounts, discounts on restaurants, 50% off show tickets, and a ton more.
Living in Vegas is great because they really do appreciate the locals. Over half of this city works in the hospitality industry, so they keep us happy!
See my original post.
Sign up for the guestbook, follow the social media accounts, and Google! But remember, always book direct.
November and December also have the best rates as it is the slower season.
Why booking direct? I haven't tried specifically in Vegas, but I have definitely seen hotels cost more on their website then on a site like hotwire/expedia/priceline.
Because Online Travel Agents (OTA's) get a commission off bookings around 15%. So for a $100 room night, we would give an OTA $15. And when you book though an OTA, you are a guest of theirs, not the hotels. Kinda strange right?
The hotel receives NO information about you other than your name, room type, and check-in/out dates. Have a problem with your reservation? The hotel can't do anything.
When you book direct, you give us your information. With that, we can market to you directly. You'll start receiving offers which are pretty good! When you check-in and a front desk agent sees that you booked with us, you are MUCH more likely to get a complimentary room upgrade and better service. Your needs will be met sooner and faster than anyone who booked with an OTA.
Would complaining about a room really work as in getting a upgrade? I stayed in a corner suite in the Aria in August. One of the tv's never worked, the fridge door was broken and I hoped to get one of the rooms where the bathroom was looking over the strip. Instead I got one of the ones where it's in the middle. I kind of wanted it changed, but being from the UK I didn't want to make a fuss.
I've stayed in that suite too! It's a really cool room.
For complaining and wanting an upgrade, it won't happen. If you are nice and say that you're really dissatisfied with your room, they will most likely move you to the same room type you had before or may give you a resort credit. It also depends on how full the hotel is and if there is inventory of that room type.
Think of upgrades as this: We have a fixed cost on rooms. For example, a standard deluxe room costs us $36/night. A suite can be over $500/night. When you upgrade, that margin of our profit is decreased. And there is always low inventory on higher end suites - we will keep that room type open for a last minute booking of someone who's willing to pay full price.
Is there any reason one can't make it an open tip (with the hope but no guarantee it may get me preferential treatment), rather than a clandestine bribe? I mean, hand the person checking me in the id, card, and money, and say "here is my id, my card, and a tip for you"? I understand that it may or may not get me anything for the money, but is it in any way harmful or offensive to either party?
"Here is my ID, my card, and a tip for you if you can help make our vacation special."
Front Desk Agents - what do you think?
There isn't a non-refundable deposit for that? Or is she cancelling early enough to avoid penalties?
Canceling early enough - you're reservation is refundable up to 2 to 3 days before!
Book online. Calling into book usually charges a 'convenience fee', just like the airlines. It's stupid.
Very rarely will we know when we do.
Most celebrities stay under an alias or a managers name. Ariana Grande uses a different fake name EVERY TIME - which makes it a pain for our VIP Staff/Butlers.
Celebrities/Presidents/Politicians do not get special room rates - but they may get a room that isn't offered. For example, Jamie Foxx was put into a suite when they were 'sold out' to the public. The booking of these high status guests are usually handled by foreign affairs or an executive VIP agent.
Is timing ever important when booking rooms? I know the day before a flight takes off, rates sometimes drop dramatically so that all seats are sold
Timing is hard!
If a convention drops out last minute, we have to drop the rates to fill the rooms they had blocked off.
A prime example is the Mayweather vs Pacquiao fight weekend.
The fight was announced and we sold out all of our hotels because reservations were coming in like crazy. We couldn't control it. So we opened up one room type at a stupid rate, $1,600 per night. Reservations were still coming in. HOWEVER, no tickets for the fight had been released or even available to the public. People were booking without tickets (a stupid decision if you ask me). Once tickets were released to the public, a few days before the fight, everyone cancelled their rooms. Rates were $1,000 one minute then down to $100 the next. We knew that is was going to happen, but we didn't know how many tickets would be released etc. It was a clusterfuck of a weekend for sure.
This is the best representation of that from the fight weekend: http://i.imgur.com/1Kf9pgt.jpg
What does the front desk see when they check your player status?
Do they just see some code you fall into like "this player spends X per night at our hotel, give him this discount" or do they actually see your specific value?
I've called in just to see what the desk tells me while I've been checking my rates on the site and results vary. Sometimes the rates are exactly the same, sometimes more or less from the agent vs the site.
The front desk can't determine what kind of discount to give you.
We have a huge department, loyalty marketing, that decides all of that. The algorithm used makes my head spin! Each player is assigned a value, then we determine what we can give you based off your value. That value is a combination of your gaming spend, how long you play, non-gaming spend, average trip length, age, geographic location, income, etc etc. Then an offer in your value range is loaded to your account by loyalty marketing. Your account may have 5 to 15 different offers on it! The agent is just looking at one they believe is the best.
Keep in mind the added value to marketing offers. Your rates may be $5 more, but if you're getting a $150 F&B credit, it's worth it!
What software do you use to help decide prices? How much human judgement is there in the process?
There's a lot of human judgement!
The problem with current hotel revenue management systems is that they don't recognize sister properties.
So if we had to walk 500 people from one property to another, the system can't recognize that and adjust accordingly.
We mainly use Excel and SAS. Analysts stay with properties for a long time then learn how a hotel books. We have a lower end hotel on the strip that will have 50% occupancy then over night be at 110%.
"Walk" is when the hotel overbooks and even though you have a reservation they don't have a room, so they make accommodations for you at another hotel.
Walking 500 guests sounds miserable.
Well, it was really 500 per day. We have a large convention and had to walk 1,500 people over 3 days.
workers in Vegas seem to have gotten nicer in recent years. is this because of Yelp?
Maybe a little.
People are coming to Vegas nowadays to have an experience. They want the Vegas Experience, not to spend all day gambling.
So these major hotels realize, "Oh Shit - this guest will never come back because of how X talked to them." The personal interactions are becoming more important than ever to get an edge over the competition.
Also, I think after the 2008 crash, which hit Vegas EXTREMELY hard, people realized you guys are the ones keeping us employed. By you spending your vacation here, you're supporting me, my family, my coworkers, and our economy. We want you to come back again and have an amazing experience.
Did you or any of the staff get paid off to tell the paparazzi that there was a celebrity at the hotel?
Honestly, we really don't give two shits. This is Vegas. There are famous people here all the time and very frequently. It isn't worth releasing private information and losing your job for $100.
....I work in hotel side. Sometimes we do package deals with room and show - those will be coming up soon since it's the 'slow season'. Keep an eye on hotels social media pages!
Is there any way at all to have the resort fees waived or at least discounted?
The only for sure way I know of is to be a casino player. Once you reach a certain level of loss or win, your resort fee will be waived.
Why were there so many cheap rooms available for thanksgiving day when I was shopping around for this year?
Thanksgiving week is just a really, really dead time for the city every year. There are no conventions in town and people want to be home with their family. Same goes for Christmas day/week.
On those dates, hotel rooms may only make $7/night profit. That's how low are rates are.
Do you know what the deal is with "resort fees"? It seems like it should just be included in the price of the room if it has to be paid regardless of whether you will use any of the resort facilities. Do people get mad about this a lot? Why does it even exist? Thanks! (Edited after seeing a similar question here).
See this question I had in r/Vegas:
Resort Fees will never, ever be going away. Sorry. As a consumer, I hate them. But as a revenue management guy, they're hard not to like. Resort Fees are hard to explain, but I'll do my best: We pay a commission to OTAs for every room night booked. Normally around 15%. So when you book on Expedia 2 nights at $100/nt, the OTA gets $30. With resort fees, that is our money. OTAs don't get any of that. So we get an extra $30/nt from you. Resort fees are also important on placement on OTA websites. Most (if not all) users sort by price. MGM Grand can have a $60 showing, Planet Hollywood will be $65 - most will go with MGM Grand. However, MGM Grand has a $30 Resort Fee and PH has $25 - so they're the same price. But MGM Grand just took a ton of bookings from PH for a simple $5 difference. VegasTripping.com has a great image and article explaining it: http://www.vegastripping.com/news/blog/5094/pencil-the-golden-gate-and-the-d-add-resort-fees/
My main job was to set the hotel room rates at these properties to ensure we maximized revenues.
Were you maximizing revenue, or maximizing profit?
Revenue, mainly RevPAR or Revenue per Available Room.
The cost of a room is pretty standard and doesn't fluctuate too much. A standard deluxe room at a luxury property costs about $32-$36 per night - occupied or not.
You mentioned you had previous experience in the hotel industry through hotel maintenance/engineering work. Are there are any other qualifications that you have or that the industry requires to get this type of job? Given it's revenue management I would assume some type of finance experience may be required? Thanks for doing this AMA!
Nope, I had no background in finance.
I do have a heavy passion for Las Vegas. I am a nerd about this city. I follow the industry very closely. I watch what other companies do and what mine does. I know the stupid random facts about this town that you never will. What I think landed me the job besides this, was an intense passion for Vegas.
I started as a lifeguard in the pool area so I got my guest interaction. I knew how to handle guests and intense situations. Engineering was more guest interaction and troubleshooting.