DISTRIBUTION STRATEGY

What is Channel Management?

Cloudbeds

By Cloudbeds | Published on April 19

Effective hotel distribution is key to a profitable hospitality business. Whether you manage an independent hotel, B&B, vacation rental, or hostel, it’s critical to get your inventory in front of potential guests at all times. After all, travelers can’t book something they don’t find! This is only one of the many reasons why Channel Management is a must today. Find out more!

What is Channel Management?

Channel Management is the process of actively managing the distribution of room rates and availability onto multiple online booking channels. These channels may vary to include online travel agencies (OTAs) such as Booking.com, Expedia, Agoda, or HostelWorld; travel metasearch engines such as Google, Kayak, and Trivago; Global Distribution Systems (GDS) such as Amadeus and Sabre; online booking sites such as Airbnb, Tripadvisor, and Vrbo; travel wholesalers, niche listing sites and more.

So how do hotels pick the right booking channels for a property’s individual needs? And how do they find time to manage inventory, update rates, and keep content consistent across the many different channels — each with their own login credentials and user interface?

The answer lies with automation via channel management software built to solve this very problem.

Who needs Channel Management technology?

It’s not just hotels. All hospitality industry properties, from a luxury boutique hotel to a small guest house, can benefit from a channel manager. If your property distributes inventory to more than one online travel agent, then you should definitely consider a channel manager. It will pay off in time saved, bookings gained, double bookings prevented, and sanity preserved! Moreover, your guests are booking online!

 

what is channel management in hospitality

What is Channel Manager software?

A Channel Manager is advanced software that automates tasks when advertising onto online booking channels: from updating rates and availability in real-time to managing different rate types and centralizing reservations into one dashboard. Specifically designed to address hotel business needs, a channel manager provides one interface to easily manage all reservation sites.

How does it work?

Your Channel Management software should connect directly to your Property Management System or CRS. It acts as the real-time shepherd of room types, rates, and availability between your PMS and whichever channels you sell on.

The best channel managers integrate with your existing property management technology without sacrificing functionality or speed. They pull from a pooled inventory that maps to existing rooms to provide real-time availability updates from/to the PMS. Each new reservation or cancellation is delivered right into the PMS, without any manual intervention.

Why use a hotel Channel Manager?

It’s all about consistency, efficiency, and revenue optimization. This trifecta can have a tremendous influence on the profitability of both large and small properties. Here’s why:

  • Consistency. Each distribution channel has its own user experience. It can take up a lot of time to become familiar with each tool, which takes up precious minutes from management and increases training costs for new staff. With a channel manager, there’s a single portal for all channel management activities. Update rates and availability once, and distribute any changes everywhere. This consistency reduces the risk of overbooking while also giving guests the confidence to book in their preferred channel. When consumers see consistent fares, they feel comfortable booking at the fair and current rate. A win for the guest experience!
  • Efficiency. The consistency of user experience on the hotel side saves time and frees up staff resources for higher-value tasks. That consistency is also great for potential guests, who see accurate availability and rates. There’s no disappointment or consternation at mismatched rates on different channels, which is one of the major risks of optimizing your channel mix manually. Also, since your availability and rates are always in sync, you’ll never waste staff time navigating the tricky waters of overbookings.
  • Revenue optimization. The final, most vital, reason to use a channel manager is that it can help with revenue management. Fewer overbookings mean fewer related costs, to both a hotel’s reputation vis-a-vis bad reviews and paying to accommodate guests elsewhere. In addition, the best hotel channel manager connects your property with new guests. When doing rate and inventory management manually, it’s impossible to be everywhere you’d like. There’s just not enough time to research new sales channels, and then manage rates and availability across yet another platform. A channel manager offers new opportunities for exposure, which will increase occupancy, give you more pricing control and help with rate parity if such a policy applies to your property.

What makes a software provider great?

There are 4 must-haves when selecting the best channel manager for your hotel. If you’re looking for in-depth analysis, check out this complete guide to channel management technology.

  • Cost. The budget is always top-of-mind. Each technology must serve a clear purpose with a compelling return on investment. Most providers today charge a fixed monthly fee based on the property inventory. Commission-based or channel-based pricing gets complicated and costly. On the flip side, a “too good to be true” price is a warning sign that the channel manager may not be stable.
  • Access. The channel manager should support your existing online distribution channels, as well as other channels you haven’t used before. The goal is to have your inventory accessible to all audiences, across mainstream OTAs, metasearch, and niche OTAs. If you can easily test out new distribution channels with easy activation with a low time investment, even better!
  • Integration types. Be sure that your channel manager has two-way integration and API partnerships with all existing (and future!) channels and other hotel technology. For example, when a channel manager is directly integrated into a PMS (such as the Cloudbeds’ channel management system) your inventory is updated on your hotel website too.
  • Multi-Currency Support. Quality channel managers allow you to take control of your currency policy and distribute it to OTAs in whatever currency you desire. Booking.com in dollars, Expedia in Euros, and your own website in Kuwaiti Dinar? No problem – leading channel managers, like Cloudbeds, handle it all AND automatically update rates multiple times per day and all conversions so your accounting is not affected.

The best channel manager software providers

  1. Cloudbeds myallocator
  2. SiteMinder
  3. Staah
  4. Omnibees
  5. RateGain
  6. HotelRunner
  7. RMS Cloud
  8. RateTiger
  9. Rentals United
  10. Lodgify

 


Learn how Cloudbeds can help your Channel Management strategy. Schedule a demo with one of our Market Specialists.

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About Cloudbeds

Cloudbeds

Founded in 2012, Cloudbeds is the hospitality industry’s fastest-growing technology provider, serving global customers of 22,000+ independent properties across 157 countries. Its award-winning Cloudbeds Hospitality Platform seamlessly combines operations, revenue, distribution, and growth marketing tools with a marketplace of third-party integrations to help hoteliers and hosts grow revenue, streamline operations, and deliver memorable guest experiences. Cloudbeds was named No. 1 PMS, No. 1 Booking Engine, and Hoteliers Choice by Hotel Tech Report in 2021, and has been recognized by Deloitte’s Technology Fast 500 in 2021 and Inc. 500 in 2019.

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