This article explains segmentation and how to set it up.
What is "Segmentation"?
Segmentation means separating your reservations into different groups (segments) and analysing them differently.
Using the segmentation feature on RoomPriceGenie enables you to:
- control how the reservations in different segments affect the pricing of your rooms.
- analyze the performance of different segments separately, allowing you to make future strategic decisions with more clarity.
Why would you use segmentation?
For pricing:
The regular RoomPriceGenie algorithm treats all bookings in the same way. A booking for your room does two things:
- It signals an increase in demand for your rooms.
- It reduces the available number of rooms, thus leading to an increase in price for the rooms that remain.
⚠️ But not all bookings are the same. In particular, some bookings do not signal an increase in demand.
For example, if you have a school trip visiting and staying in your hotel, these bookings are totally independent of every other type of booking. You do not want these bookings to push up the prices for other guests, except because of the reduced number of rooms you have left to sell.
Exclude from Demand: With segmentation, you can take certain bookings and not count them towards the demand. This means that they will have no impact on the demand estimation for your hotel on that night or in the month.
Exclude from Supply: In addition, you can also remove them from the supply calculation, which effectively treats the rooms as closed, meaning that the bookings have almost no impact (there is still a little bit of an impact on prices as the supply does change). This could be used if, for example, it is low season and you know you will not be full anyway, so you don’t want your prices to go up if a group books.
For analysis:
You can look at the key metrics for different segments (e.g., ADR, lead time) and determine whether you want to increase or reduce the contribution of those segments relative to the others.
For example, you may see that your special corporate rate is costing you a lot of money by filling you up at cheaper rates during times that are already busy.
How do you set up segmentation?
In the PMS: You will need to tag all of your reservations using the correct field in your PMS, usually, this is called the ‘Reservation Code’ or something similar.
All reservations that you want to put in a segment need to have a label in this field, for example, ‘Groups Corporate’ or ‘Groups Leisure’.
In RoomPriceGenie: When your reservations are tagged with a label, you can then group them together within RoomPriceGenie. For example, you may want to set up a segment called ‘Group Bookings’ and in that segment, you put all bookings with the tag ‘Groups Corporate’ as well as all those with the tag ‘Groups Leisure’. Please see the demo video below.
[a step-by-step guide is currently being created and will be added here soon. Thank you for your patience!]
What if I do not set up segments or miss out on a segment?
All bookings without segments are just treated as normal bookings. Only the segments that you set up are affected.
[a step-by-step guide is currently being created and will be added here soon. Thank you for your patience! In the meantime, please do not hesitate to reach out and we will help you set up the feature for your RoomPriceGenie account.]