Setup Auto Tiering (Cloud)
Path: Revenue Management Live! > Revenue Management Live! > Auto Tiering
The Rate Change Hierarchy
Before we dive into setting up auto-tiering, it’s crucial to understand the rate change hierarchy. Auto-tiering does not mean you lose complete control over rate management; you will still have the ability to override rates as needed. The hierarchy works from left to right, with each process on the right having the ability to override those on the left.
Setup Auto Tiering
1. Prior to configuring auto-tiering, ensure that you have set up the tier rates in the management section.
2. There are 3 tabs at the top, Stay on "Tier Setup".
3. When you're ready to activate the feature, ensure that you check the box labeled "Use Auto Tiering." You do not need to check this box during the setup phase.
4. Auto-tiering is activated based on your occupancy rate, but it’s up to you to determine the trigger rate. One key decision is whether to include out-of-order rooms in this occupancy rate.
This choice can significantly impact your rate strategy. For example, if you have 100 rooms, none of which are currently sold, and 50 rooms are out of order, and you set a tier 5 rate to trigger at 50% occupancy, do you want your occupancy rate to be at 50% occupancy, meaning that any rooms available would be priced at the higher tier 5 rate? Or would you prefer the occupancy rate to reflect the actual situation, showing 0% occupancy and applying the base rate instead?
It’s important to note that the occupancy rate will be calculated based on the combined total of all room types—i.e., the property’s overall occupancy rate—rather than by individual room type.
5. Another crucial decision regarding your occupancy rate is whether to include group allocations in your calculations. This choice can significantly influence your rate triggers, especially if you frequently work with group bookings. Including group allocations could lead to different occupancy rate calculations, which in turn affects when and how your auto-tiering thresholds are triggered.
For example, if group allocations are included, your occupancy rate might appear higher, potentially leading to earlier activation of higher-tier rates. Conversely, excluding them might delay the rate changes, as it reflects a more accurate occupancy level without the influence of group reservations.
6. Now it's time to set up your triggers, defining when and at what occupancy level you want to activate changes in your rates, whether that means increasing or decreasing them. Since you can create up to 9 tier rates, totaling 10 different rates including the base rate, you can now set up up to 9 trigger levels.
For each trigger level, specify the occupancy rate percentage that will activate the corresponding tier rate.
Remember, the occupancy rate applies to all room types, and triggers cannot be set up for individual room types.
By configuring these tier rates in the next step, you can tailor your pricing strategy to respond effectively to changing occupancy levels, thereby maximizing profitability and maintaining competitive pricing.
7. Now that you’ve set up the levels and occupancy rate triggers, you need to assign the tier rates that will be applied at each level.
8. While you can create up to 9 trigger levels, you can assign different tier rates to the same level at various times.
This means you can configure the PMS to trigger a Base rate at Level 5/50% for any bookings made up to 90 days in advance, while also setting the same Level 5/50% to trigger a Tier3 rate for bookings made up to 30 days in advance.
In the example below, the levels are configured to trigger different tier rates for reservations made within the following timeframes: 90 days or more in advance, between 60 and 89 days, between 30 and 59 days and within 0 to 29 days.
9. Finally, once all the settings are configured, make sure to click "Save" to apply your changes.
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