QT Gold Coast Hotel: Revenue Management Practice Analysis Report

This report analyzes the revenue management practices of the QT Gold Coast Hotel, examining various aspects of its operations. It begins with an introduction to revenue management, defining its core principles and applications within the hotel and tourism industry. The report then delves into the reasons and purposes of establishing an effective revenue management system, exploring current industry trends and conducting a SWOT analysis. The analysis extends to a broader business context, including group analysis, identification of issues with market performance, and property and trip analysis. Specific revenue-generating departments are outlined, and pricing and revenue management strategies are evaluated. The report also explores the implementation of revenue management strategies at the QT Gold Coast Hotel, analyzing market segments, competitive environments, and decision-making frameworks related to pricing, inventory control, and distribution channels. The conclusion summarizes the key findings, emphasizing the importance of understanding market dynamics, competitive pricing, and effective inventory management in maximizing revenue within the hospitality sector.

Tourism & Hotel Revenue
Management Practise
Analysis

Table of Contents
INTRODUCTION...........................................................................................................................3
ASSESSMENT 1: REVENUE MANAGEMENT..........................................................................3
1. Reason and purpose of establishment of effective revenue management system in the hotel
and tourism industry ...................................................................................................................3
2. Current trends within this industry ........................................................................................3
3. Assessment of the given statement ........................................................................................4
ASSESSMENT 2: Broder business Analysis.................................................................................5
2.1 Group Analysis .....................................................................................................................5
2. Identification of the issues with use of national and market average performance.................5
2.2 Property and trip Analysis.....................................................................................................5
1) Outline different revenue generating departments..................................................................5
2) Evaluation of pricing strategies and revenue management strategies, tactics used in the
operations.....................................................................................................................................6
3. Implementation to RM strategy in QT Gold Coast hotels.......................................................7
4.Analysing the main concepts of Revenue management decision making framework..............8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Revenue management can be defined as the use of analytics which assist in forecast the
behaviour of customers at the level of micro market and optimizing the availability of product
and price to increase the revenue of the business. The QT is owned by Event Hospitality and
Entertainment. It belongs accommodation and hospitality industry Feldman & Topaloglu (2017).
The Report will outline different revenue generating departments, strategies used by organization
for revenue management. It will also describe basis for implementing revenue management
strategy and tools strategies applied by business for revenue management.
ASSESSMENT 1: REVENUE MANAGEMENT
1. Reason and purpose of establishment of effective revenue management system in the hotel
and tourism industry
Revenue management system: in the hotel and tourism industry can be defined as
application of the strategic distribution and pricing tactics in the organisation to sell the property,
product and services of the various organisations within this industry. A revenue management
system means to sell the property, perishable inventory at right time to right guest to boost the
revenue growth. The reason and purpose of revenue system for hotel and tourism industry are as
follows:
Lowering the cost: the main purpose of this system is to provides rooms and services at
optimal cost. This can be done with analysing the current trends, understanding the economy of a
region, season and average number of tourists.
Attracting the ideal guest: the revenue management system ensures maximum
occupancy which is important for all the hotels and repetitive consumers are more lucrative than
new ones. An automated revenue manager assists the hotel in identification of right consumers
who can provide greatest and long-term value to the future property.
2. Current trends within this industry
SWOT analysis of hotel and tourism industry in Queensland:
In order to identify the current strength, weaknesses, opportunities and threat it is quite
beneficial for the firm to use SWOT analysis and this is as mention below:
Strength: The industry provides different ways that helps to attract wide range of public
towards it. Such that as the QT provides different accommodation services to their customers

that helps to make the tourist comfortable within the area. The industry also helps to provide
different opportunities to the individuals in order to reduce the size of unemployment.
Weaknesses: the initial amount require to run the project is quite high and that is why, it most of
the company did not initially invest into this industry. On the other side, there are many expenses
incurred during the process. And further, the revenue management structure of the hotel industry
is not up to the mark that is why, it affect the business in negative way.
Opportunities: By providing best and attractive services to the tourist, the industry generate the
opportunities that helps to sustain the brand image in the company. Moreover, using advance
technology, the industry also develops the strategy to opt different revenue management system.
Therefore, it shows that the growth option of the industry is high and that is why, it also ensure
to enhance its financial position of the company as well.
Threats: Political unrest is one of the common threat that affect the industry in negative way and
most of companies relate to this industry and thus, it creates direct impact upon the company's
overall economic condition. Therefore, the company also faces tough competition from their
competitor and that is why, the industry has to develop the strategies that helps to overcome from
threats.
3. Assessment of the given statement
The statement clearly means that the hotel industry uses different ways that helps to access the
customers and that is to sell the rooms using advance technologies and this directly help to
manage the revenue of the firm and in the same way, as the concept of revenue
management reflect that it helps to predict the consumer demand in order to optimize an
inventory as well as price availability that further assist the business to increase the revenue.
Hence, this aid to simulating the demand at the time of low demand and also avoid the
pricing practice as well.
Therefore, it has been clearly analysed that by selling the rooms inventory into the business
will help to manage the revenue in better way and as a result, in Australia, there are different
hotels who uses online booking methods which assist the business to attract wide range of
customers and as a result, it directly increases the demand of customers in the peak seasons.
Hence, the statement justifies that using different pricing strategies and online booking will
help the business to increase the revenue management system as well so that it will help to
sustain the brand image in the market.

ASSESSMENT 2: Broder business Analysis
2.1 Group Analysis
1. Relative performance evaluation:
The market penetration index is calculated to measure the occupancy of hotel as
compared to the average market occupancy level.
Market penetration Occupancy: Hotel occupancy/market occupancy
Occupancy:
Gold Coast: 71.6%
Market occupancy: revenue sold at the hotel / revenue sold within competitive set (Brisbane)
=> 107.7/142=151.94%
MPI= 71.6/151.94
= 47.12%
2. Identification of the issues with use of national and market average performance
This method does not take higher prices and it is not possible to lower the product prices
at ones will. When the products are too expensive the businesses tend to struggle while trying to
produce enough to lower the production and the product price. When competing the large firms,
it becomes more complex. Brands that produce luxury products often make mistakes like
marketing it as a cheap item. Organisation with more products with luxury products when uses
MPI can shows major harms. This techniques can harm the entire organisation if the competitor
sells similar product and one of them decided to lower and in order to match the same
organisation is required to do the same.
2.2 Property and trip Analysis.
1) Outline different revenue generating departments
Information related with QR hotels are as follows -
Full capacity rooms It has total 297 guest rooms.
Ownership branded or independent Subsidiary of Event Hospitality and
Entertainment.
Service type Hotel accommodation and hospitality
Location Gold Coast, Australia

Name QT Hotels & Resorts.
Website Qthotelsandresorts.com
Outline of Revenue generating departments : There are different departments that helps hotel to
generate revenue. Such as -
Food and beverage -
Another major source of revenue for the hotel is food and beverage department. As more
and more guests will come it means, more revenue for the owner of the hotel.
Accommodation -
Accommodation offer by the hotel is one of the major source of revenue for the hotel.
The rooms are having open space setting and very beautiful features and custom lighting that
helps to attract clients to stay in hotel.
Packages -
Hotel also offer various types of packages to the customers along with special deals.
During holiday more and more customers stay in hotel. Package is a type of bargain for
customers although it offers additional revenue for the owner of QT Hotel.
Marketing -
Marketing department plays an important role in generating income for the hotel. There
are various social media platforms that are used by QT Hotel such as LinKedIn, Google+,
Twitter etc.
2) Evaluation of pricing strategies and revenue management strategies, tactics used in the
operations.
Pricing strategies adopted by different department-
Pricing strategy adopted by QT Hotel helps to increase revenue by providing quality
products and services to the customers. Management of the Hotel is using competitor-based
pricing strategy for providing accommodation facilities to target customers. The hotel consider
the rate at which other hotels operating in hospitality industry are offering facilities. On the basis
of this, QT Hotel set the price.
Revenue management strategies and tactics-
There are various types of revenue management strategies and tactics adopted by the
management of the hotel. These are as follows-

 Firstly, management focuses on understanding the demand of guests by
understanding the market. Market research helps the management to take strategic
decisions regarding product, service, price that may impact seasonal demand.
 Another strategy for revenue management that hotel uses is market segmentation.
It helps to attract target market customers.
3. Implementation to RM strategy in QT Gold Coast hotels
Understanding the market: The main reason behind the success of QT hotel involves its
perfect understanding of the market. The hospitality company performs market research in
order to identify its target customers, their needs and wants and then set the prices
accordingly. This company also has a great knowledge about the local factors affecting the
hotel and its seasonal demand which has further helped in their growth and also maximized
QT Gold Coast net revenue (Kimes, 2017).
Pricing strategy: Gold Coast hotel have implemented a competitive pricing strategy in order to
become the market leaders. It is essential to analyse the competitors, their pricing methods
and develop a strategy accordingly (Guo, Ling & Gao 2016).
a) Review the market segment mix, as well as seasonal changes.
Geographic segmentation: Geographic segment targets customers who share common
interest, socio-cultural values and needs and wants because QT hotel company attracts customers
from all around the world.
Demographic segmentation: divides customers on the basis of their age, gender, education
level, income and occupation. Use of penetrative pricing strategy allowed the QT Gold Coast
Group in not only attracting new customers but also retaining the previous customers as well.
Seasonal changes: The QT hotels face seasonal changes mainly due to the vacation and
festival season and this is when they attract large number of customers. As change is concerned
with the changes in overall demand of the hotel industry due to external factors like weather and
holidays.
b) Assessing the pricing position in the immediate competitive environment
The major competitors of QT includes Ramada Resorts and Spa and Hilton hotels therefore the
hotel company sets up extremely competitive prices in order to gain huge market share
which can be beneficial for them in the long run.

4.Analysing the main concepts of Revenue management decision making framework
Product/service related pricing strategies: There are various pricing strategies adopted by
different hotels and resorts. The Gold Coast hotel focuses on market penetration strategy
where they price their rooms and other services at an affordable and competitive rate in
order to gain huge market share.
Inventory control strategies: The QT hotel company uses various inventory control strategies
and technology to ensure adequate management of the stock so that there is no problem of
having surplus/deficit stock as both can hamper the profitability of the company.
Use of inventory control strategies provides several benefits in the form of cost benefits as well
as profit maximization(Kimes, S. E. (2017).).
Distribution channel strategies:
Global distribution systems: The QT hotel
uses GDS a computerized network as it
provides them real time information
regarding the bookings done by
international guests immediately.
Proprietary website: A proprietary website
is a closely linked technology that a
developer owns and controls. Hotels use
this to promote their business,
restaurants as it has helped them in
attracting more customers.

CONCLUSION
From the above file it can be concluded that QT Gold Coast is an international luxurious
hotel that uses revenue management strategy to maximize their profits. Also, it uses various
strategies in order to improve their pricing and to achieve competitive strategy. Further it also
included explanation of various business terms that gives a better understanding of how hotel
industries perform and use technology to increase their overall performance. The QT group
needs to promote their business even further in order to become a market leader and also the
hospitality group should accept feedbacks from their customers in order to improve their services
even further and also achieving profit maximization.

REFERENCES
Books and Journals -
Board, S., & Skrzypacz, A. (2016). Revenue management with forward-looking buyers. Journal
of Political Economy.124(4).1046-1087.
Feldman, J. B., & Topaloglu, H. (2017). Revenue management under the markov chain choice
model. Operations Research.65(5). 1322-1342.
Guo, X., Ling, L., & Gao, Z. (2016). Optimal pricing strategy for hotels when online travel
agencies use customer cash backs: A game-theoretic approach. Journal of Revenue
and Pricing Management, 15(1), 66-77.
Harsha, P., Subramanian, S., & Uichanco, J. (2016). Omni-channel revenue management through
integrated pricing and fulfillment planning. Ross School of Business, University of
Michigan.
Iuliano, S., Lawlis, T., & Coates, A. (2019). Abstracts of the 42nd Annual Scientific Meeting of
the Nutrition Society of Australia, QT Hotel, Canberra, Australia, 27–30 November
2018.
Kimes, S. E. (2016). The evolution of hotel revenue management. Journal of Revenue and
Pricing Management, 15(3-4), 247-251.
Kimes, S. E. (2017). The future of hotel revenue management.
Vossen, T. W., & Zhang, D. (2015). Reductions of approximate linear programs for network
revenue management. Operations Research.63(6). 1352-1371.