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The Basics of a
Channel Manager:
A Guide for Independent Hoteliers
Contents

Why you need one 3

Features to look out for 5

Costs to consider 12

Buyer’s Guide Checklist 13

The Basics of a Channel Manager: A Guide for Independent Hoteliers 2


Why you need one
100 Room Hotel
If you’re wasting too many hours of
your day posting hotel availability As an example, if a hotel has 100 rooms
information and current rates on 20
Rooms
20
Rooms
and is working with 10 Online Travel
Agents (OTAs), that hotel must then give
various extranets, then this is where a 10 rooms to each OTA. That’s in theory.
channel manager can step in and shift What actually happens, however, is that

the needle. 10
Rooms
10
Rooms
hotel will provide its best suppliers more
rooms, meaning the smaller players get

10 10
way less than the average 10.
Ultimately, a channel manager allows you to distribute the Rooms Rooms This means the hotel has to constantly
rooms that you have available across a variety of different monitor and shuffle its inventory, with
channels, providing you with an opportunity to reach a global
audience.
5
Rooms
5
Rooms
the real risk of missing bookings, as they
run out of inventory on the smaller – but

5 5
Without a channel manager, you’ll have to split your room still valuable – OTAs.
availability among different agents to ensure that you don’t Rooms Rooms
overbook your rooms on any given night. This can lead to
wasted inventory and lost profits.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 3


Why you need one

Through a channel manager, you can display your live 1 0 1 0

availability across all your channels, allowing various agents


to book your rooms at any given moment.

A channel manager is the only way to tap into the potential


1 0 1 0
of the virtually endless online booking market.

1 0 1 0 RATES AND
AVAILABILITY

The Channel Manager RESERVATIONS

Rooms
1 0 Available

HOTEL

PMS/CRS

Rooms
1 0 Available

The Basics of a Channel Manager: A Guide for Independent Hoteliers 4


Features to look out for
If you are interested in educating yourself on the channel manager
options available to you, the following information can prevent you
from picking a system that doesn’t suit your hotel’s needs.

Here are the kinds of features you should be looking for


when choosing the best channel manager for your hotel.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 5


Features to look out for

Numerous channel connections


You need to make sure that the channel manager you choose…

• Supports the booking sites you already sell through; and,


• Gives you the opportunity to connect with new booking sites that reach different markets.

This ensures that you will connect to as many sites as possible without ever worrying about
overselling your rooms. Making sure international travellers can easily book with you is a top priority
for independent hotels. Your channel manager should help you do this by allowing you to partner
with a variety of OTAs that can allow you to reach markets you could never access directly.

For example, to sell your rooms to Chinese travellers, you should connect with Ctrip, because it is
the preferred booking site in China. The more sites a channel manager connects you to, the better.

Using a true pooled inventory model, SiteMinder’s Channel Manager helps tens of thousands of
hotels worldwide increase their online exposure to convert prospective guests into paid bookings.

Providing two-way XML connections to more than 350 of the world’s leading booking channels from
one central cloud application, SiteMinder’s Channel Manager provides properties of any size a way
to maximise exposure, increase revenue, and reduce overall costs.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 6


Features to look out for

1 0 1 0

Deep system integrations 1 0 1 0

Your channel management software should


integrate with your existing core systems, 1 0 1 0 RATES AND
AVAILABILITY

so there is only one view of inventory and The Channel Manager RESERVATIONS

bookings at any point in time. Rooms


1 0 Available

SiteMinder’s Channel Manager allows you to eliminate manual entry HOTEL

and reduce the risk of overbookings with deep integrations to 150+ of


the world’s top PMSs, CRSs and RMSs. PMS/CRS
You can update your rates and apply stop-sells at the click of a button.
The channel manager will automatically reduce availability when a 1 0 Rooms
Available
room is booked on any one of your sales channels.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 7


Features to look out for

A good channel manager will allow you to easily track and measure which online sales
Solid reporting on channels are working. This gives you the knowledge you need to negotiate commissions and
end partnerships that aren’t working for you.

which channels work Your channel manager will run seamless connectivity using pooled inventory delivered
to some of the world’s biggest online travel agents and third party booking sites. Here at
It goes without saying that in order to SiteMinder we have more than 350 available to our hotel customers all over the world.

manage your revenue successfully, you must We know it’s unlikely you’ll connect to all 350 at your hotel, but let’s say you connect to 10%
of those available. That’s still 35 channels to analyse and report on – a big job for any busy
be able to see all your revenue streams hotelier.
– from the online booking websites where By choosing a channel manager with comprehensive built-in reports, you’ll gain faster and
you advertise your property, to your more effective insights into how your inventory is performing across all 35 distribution
channels so you can chop and change as it’s needed. It’s critical to compare and understand
marketing and sales efforts. how successful each channel is in terms of revenue – especially when you want to try
connecting with a new channel for your market.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 8


Features to look out for

Here is
an example
from SiteMinder’s
Channel Manager You should use your
showcasing channel channel manager to look at:
effectiveness • Your channel yield
over time:
• Earnings from reservations
• Booking volume and average lead time

How to action these metrics


Armed with these insights, a data-driven hotelier can
adjust their strategy accordingly and make confident
decisions on things like, when to reduce availability,
when to close out rooms, or when to increase rates on
the channels that generate the least revenue in favour
of those that are
more profitable.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 9


Features to look out for

In this case, all inventory is automatically reduced across all booking sites when a booking is
Pooled inventory made on any site. SiteMinder’s Channel Manager works in real time so if there’s one room left
on Booking.com and one room left on Expedia, and one of those sells, it’ll be updated on all
SiteMinder’s Channel Manager uses a sites immediately.

pooled inventory distribution model. Crucially by using the pooled inventory model, SiteMinder allows hoteliers to sell their stressed
inventory - the very last remaining rooms - helping maximise revenue. You can read more
But what does that mean and why is it about this model on our blog. With pooled inventory, you can provide all your OTAs with all of
beneficial? Pooled inventory means that your inventory at once, so you never miss a booking.

you evenly distribute all your available Secondly, and more importantly, by giving all of the OTAs all of your inventory at once – which is
what pooled inventory supports – most of the OTAs will reward you with better visibility in their
rooms across a number of sites – including ranking algorithm. No one knows for sure what the actual algorithms are and they do change
your own website. from OTA to OTA, but generally OTAs are keen to provide priority if they have more rooms to
sell its simple business logic.

The Basics of a Channel Manager: A Guide for Independent Hoteliers 10


Features to look out for

“It’s fundamental to have the technological tools that


help you to speed up the management of all the data
and variables we analyse daily... I think a tool like
SiteMinder‘s Channel Manager is essential, or any
Meritxell Pérez from HotelsDot, a company other that could help you in this way.
specialising in revenue management and
online marketing mostly for independent SiteMinder has 100% reliability, and I am really happy
with how it works - the usability is very intuitive for
hotels and small chains, says: creating reports, and we get data that it is very useful
to us. We use these reports to see how sales are
performing in the different channels, and the support
team is very efficient, they answer quickly.”

The Basics of a Channel Manager: A Guide for Independent Hoteliers 11


Costs to consider
Independent hotels and smaller chains have to be extremely
careful with how they spend their budget, so it is important to
assess the costs involved.

Licensing cost

The cost of using the software will either be in a commission-based or flat


monthly fee format.

A flat monthly fee is better for budgeting purposes, and will allow you to
reinvest most of your revenue back into the property as you grow (instead
of taking a significant chunk of it).

Additional training, setup, and user fees

Find out if you will be charged for initial setup and training. Some will also
charge you per additional user that you add to your account (for example,
if you want to give your new receptionist access to it).

The Basics of a Channel Manager: A Guide for Independent Hoteliers 12


Buyer’s Guide Checklist: Fill in this form and compare

Vendor 1: Vendor 2: Vendor 3:

Feature
Yes - two-way XML connections
Does it offer two-way
are available to 350+ of the world’s leading booking
channel connections?
channels.

Is pooled inventory Yes - ensures you can sell your


available to maximise maximum available rooms on many channels at any
revenue? given time.

Are integrations Yes - deep integrations to 150+


enabled with your of the world’s top PMSs, CRSs,
current systems? and RMSs.

Does it deliver
Yes - The Channel Manager reports on channel
comprehensive
yield, earnings from reservations, booking volume,
reporting to measure
and average lead time.
success?

Are you signing up


for a contract? Is it Flat monthly fee with no commission involved. Free
a flat monthly fee or trial for 14 days offered and no lock-in contracts.
commission-based?
The Basics of a Channel Manager: A Guide for Independent Hoteliers 13
The Channel Manager

See how The Channel Manager can help you...

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Get booked Remove manual entry with complete Have all your rooms online Make more powerful,
faster online real-time automation at once to increase revenue insightful decisions

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