Industry Veteran Mark Lomanno Offers His Hotel Pricing Wish List for 2019

Industry Veteran Mark Lomanno Offers His Hotel Pricing Wish List for 2019

In the spirit of this holiday season, HX: The Newsletter Editor Laura Koss-Feder spoke with industry veteran Mark Lomanno of Kalibri Labs about what he would ideally like to see happen in the hospitality industry next year. Lomanno shared his wisdom, based on his more than 35 years of experience in the business.

Q. What is your biggest wish for the hotel industry in 2019?
A. I would like individual hotels to stop making pricing decisions based on what their comp set is doing.

Q. Why is this not good for the industry?
A. If another hotel lowers its price and then you, in response, lower your price in your market, you are just playing follow the leader - and that is not always a good thing. Pricing based just on this makes everything average. This causes the industry to short sell itself by lowering the value of the hotel. I would like to see hotels figuring out what their optimal performance is, rather than just looking at comp sets. It then becomes harder to raise rates when you need to, and it becomes a race to the bottom downturns in the industry. Somewhere along the line it became okay to raise rates two to three percent, when they should go up five to six percent.

Q. What can hotels do about this then?
A. Figure out what your property is worth and use that to help set your rates. You may wind up charging a higher rate and have some less occupancy, but that would be the way to go. For instance, if you are running an 80 percent occupancy at $200 a night, you could probably charge higher.

Q. What else is on your wish list for the hospitality industry?
A. I would like to see hotels learn how to use some lessons from players like Airbnb. Hotels should be paying more attention to online customer reviews. They will, in effect, tell you what quality control issues you have and what you need to do to act upon any of these issues.

Tuckwell Skuda Mark Lomanno is a partner and senior advisor for Kalibri Labs, a hospitality data analytics company that focuses on helping hotels improve profit contribution by evaluating performance based on revenue net of customer acquisition costs. In addition, he advises several start-up and investment companies in the hospitality and data space, including Duetto Research, Aspire Marketing, Venturism, and FireLight Camps, where he also sits on the board of directors. Lomanno serves on the advisory boards of the Center for Hospitality Research at Cornell University; the University of Delaware’s School of Hotel, Restaurant and Institutional Management; and the School of Tourism & Hospitality Management at Temple University. He is an active member in the Hotel Development Council of the Urban Land Institute and is a named Conti Professor at Pennsylvania State University.

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