Get — And Stay — Ahead By Boosting Your Market IQ
Today's guest blogger is Glenn Hasen, CEO of Seattle-based QL2 Software
Whether analyzing fare prices on a transcontinental route or changing car rental fees based on specific market conditions, having access to the latest market intelligence, exactly when you need it, is both trickier than ever and one of the most important factors in staying competitive.
In the past, pricing and revenue managers used expensive and time-consuming methods for gathering market intelligence: purchasing syndicated market research, commissioning custom studies, or conducting manual price checks. In recent years, two things simultaneously occurred to render traditional market intelligence methods obsolete. First, the number of suppliers skyrocketed — regional airlines, niche car rental agencies, boutique hotels, etc. Second, a plethora of travel data has come online as the industry has built out its websites and e-commerce capabilities. Today, if gathered and analyzed appropriately, real-time data from the web provides an unparalleled market-intelligence resource; however, it changes rapidly and can be cumbersome to acquire.
This transparency of travel-related market intelligence makes it even more imperative to have access to data that is continuously updated. It’s important to understand what and how your competitors are really selling across all distribution channels. And knowing, for example, precisely when your competitor is out of seats or rental inventory provides an opportunity to further optimize revenue.
Here are some real-world examples of the rewards of real-time market intelligence:
• Carriers A and B go head-to-head in the competitive New York-to-Los Angeles route. Carrier B files a deeply discounted fare. Before matching, Carrier A uses market intelligence tools to “shop” the web and discovers that Carrier B is only offering the sale fare on a late night flight on Tuesdays. Carrier B then decides the sale fare is not significant enough to match and minimizes revenue dilution.
• Car Rental Company A and B compete in various cities. Obtaining and quickly analyzing online data, Company A notices that Company B does not have anymore Economy size cars (ECAR) and Standard size cars (SCAR) available for rent over the next few days. Company A seizes the opportunity by raising rental rates for ECAR and SCAR at same location.
• Hotel A and B compete in a specific location. Hotel A’s automated daily analysis of online pricing and availability information reveals that Hotel B is offering lower room rates for check-in dates 21 days out. Hotel A adjusts to remain competitive and thereby prevents Hotel B from increasing its market share.
Bottom line: All of these examples illustrate the tremendous benefit market intelligence access can have on a company’s revenue stream. These days, having the best and most up-to-date information can often mean the difference between staying ahead of the game — or falling way behind.