Step back in time for a moment to your middle-school chemistry class. Many kids are familiar with a classic experiment that combines vinegar and baking soda. When mixed together, these two useful pantry staples turn into an explosion of foam due to the acid-base reaction.
Besides being wildly entertaining, it shows that some things are simply more powerful when mixed together. The same is true for car park operators looking to improve revenue management. While some rely solely on a reservation system to maximize revenue, others look to a revenue management system to do so. The truth, however, is that both technologies are necessary for a car park’s overall success.
Car park reservation systems
Reservation systems profoundly impacted the car park industry because customers were finally able to reserve spaces in advance and often take advantage of discounts or packaged pricing. Many parking operations rely on these systems to vary parking rates and aim to yield in order to grow revenue. Though these reservation systems can provide information via reports and support rate changes, they are unable to process big data and provide the deep analytics that a revenue management system provides.
Car park revenue management systems
To dig deeper, a revenue management system is necessary. Modern systems are built to process complex pricing decisions multiple times a day. By using big data, these systems eliminate spreadsheets and the high level of human effort associated with them to give operators sophisticated analytics to maximize productivity, optimize rates and profitability.
A powerful car park pairing
When these two revenue tools work together, the impact on profit margins is as dramatic as that vinegar-baking soda explosion.
First, managers are able to make informed pricing decisions because forecasting demand is simplified. Reservation systems and parking management systems provide detailed historical data while revenue management systems provide powerful predictive analytics about the flow of traffic today and into the future. This technology provides occupancy and demand forecasts for both pre-book and drive-up business, which gives managers confidence when making business decisions.
Another benefit of using both systems is the potential for dynamic pricing.
Is a given booking displacing potentially higher-value drive-up business? This is a question managers face every day when deciding just how much space to sell through their online reservation systems. A revenue management system driven by analytics can create dynamic pricing decisions that will adjust intelligently. Therefore, price changes can be implemented based on demand patterns and price sensitivity, apparent in the data — easily optimizing revenue.
Finally, and here’s where things get exciting, these pricing decisions can now be automated.
After looking at numerous variables through intelligent analytics and then processing that data via complex algorithms, revenue management systems produce customized pricing recommendations that can be completely automated and integrated with the sales channels. That means commercial managers can allow the system to optimize, recommend and implement pricing adjustments, and they can do so with assurance that those decisions will drive the bottom line.
Driving profitability with strategy
Reservations systems are a critical component of how car parks do business, but until you pair yours with a revenue management system, the power of big data cannot be harnessed. Create a chemical reaction in your revenue growth and learn more about car park revenue management systems today.
IDeaS Revenue Solutions leads the hospitality and travel industries with the latest pricing and revenue management software, services and consulting. Powered by SAS® and more than 25 years of experience, IDeaS proudly supports more than 7,000 clients in 94 countries and is relentless about providing its clients more insightful ways to manage the data behind their pricing practices.
IDeaS empowers its clients to build and maintain revenue management cultures–from single entities to world-renowned estates–by focusing on a simple promise: Driving Better Revenue.
IDeaS has the knowledge, expertise and maturity to build upon proven revenue management principles with next-generation analytics for more user-friendly, insightful and profitable revenue opportunities across the enterprise.
For more information, visit www.ideas.com.