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[Sponsored] André Santos, director of hospitality solutions at Duetto, explains why reactive pricing costs independent hotels more and how Duetto’s Open Pricing helps teams act sooner, protect rate, and improve profitability.
I did it for years inside a brand, with a safety net underneath me. Independent hotels do not have one.
For most of my career as a revenue manager I told myself I was being disciplined. Yesterday looked soft. Today it does not. Two hotels on the same street had already moved. I would wait one more day of pickup before touching anything, because acting on a partial picture felt like guessing, and holding felt like judgement.
It was not judgement. It was delay with a good explanation attached to it.
I was inside a brand at the time, which is worth saying, because the brand absorbed most of what that delay cost. There was loyalty demand arriving whether I acted or not, and a cluster team above me who caught the calls I dropped. Independent hotels have neither. The same delay costs more, and it lands on one person.
Waiting feels responsible because the cost is invisible
Reactive pricing survives because its price never appears on a report.
Hold rate and the weekend fills, you were right. Hold rate and the weekend does not fill, you discount late and recover most of it. Nowhere does a line appear that reads: the eleven rooms you sold at 140 on Tuesday would have gone at 175 the previous Thursday, before your compset noticed the same demand you had already seen.
That number is real. It simply never gets written down. So the habit repeats, and it repeats with the full confidence of never having been contradicted.
Independent hotels carry the delay differently
There is no loyalty engine quietly feeding direct demand, and no corporate cluster to catch a late decision. The revenue manager on property is often the entire revenue function: analyst, forecaster, decision maker, and frequently the person answering the phone while doing all three. Fewer rooms also means less inventory to absorb the mistake once it is made.
This is not a skills problem. Some of the sharpest revenue thinking I see across EMEA is happening in hotels with 40 rooms and no revenue department at all. It is a structural problem. The commercial picture gets assembled by hand, from systems that were never designed to talk to each other quickly.
Price your own demand, not the version of it you can already prove
The fix is not a better read on what the market is doing. It is pricing against what your own demand signals are already saying, segment by segment, channel by channel, room type by room type, rather than moving everything together once the story becomes undeniable.
Open Pricing, the model Duetto pioneered, is the working version of that idea. Instead of a BAR ladder dragging every room type and channel up or down in step, each part of your inventory responds to its own signal as that signal appears. A suite can hold a premium while your standard rooms soften. Direct can stay firm while one OTA cools. Corporate can keep arriving while leisure eases off.
I will be honest about the part that is harder than it sounds. Pricing every segment independently costs you the one thing a single BAR gives you, which is one number to defend in the owner meeting. That is a genuine loss, and it is why hotels resist the model long after they have understood it. The answer is not that the number stops mattering. It is that you trade one number you can explain quickly for a set of decisions you can explain properly, and the second conversation is the one owners actually want to be having.
RevPAR answers half the question
RevPAR earned its place as the industry standard. Occupancy and rate in one figure, comparable between any two hotels in any market. Alex Zoghlin, CEO of Duetto, and Michael Grove, CEO of HotStats, have made the case at length that it is now insufficient rather than wrong, and I agree with them.
The gap is that RevPAR treats every unit of revenue identically, regardless of what it cost to earn. Duetto’s analysis puts occupancy driven growth at roughly 30 per cent flow through to operating profit, because more guests means more labour and more cost to serve them. Rate driven growth at stable occupancy flows through at 50 to 60 per cent, because serving the same number of guests at a higher price costs close to nothing extra. Shift the mix toward direct and the number improves again.
Three ways to add the same amount of RevPAR. Three different outcomes at the bottom of the P&L. That is arithmetic, not opinion.
Distribution makes it concrete. A room sold at 150 through an OTA still reads as 150 of RevPAR. After commission at 15 to 20 per cent you keep somewhere between 120 and 127. The same room sold direct at 140 keeps more than that. RevPAR ranks the first booking above the second. Your bank account does not.
GOPPAR sees what RevPAR cannot, and so do cost per occupied room and departmental margin. None of this replaces RevPAR. It puts a second question beside it. Not what should this room cost, but did this booking leave anything behind.
Curious what Open Pricing looks like in practice? See how it works here.
Holding rate is a decision, not the absence of one
The instinct on a soft looking weekend is to discount. Sometimes that is correct. More often it is a reflex, and it costs more than it returns, because occupancy bought with rate erodes the number underneath it, and rate is harder to rebuild than occupancy was to fill.
The version I would defend is this. Let routine pricing run in the background against your own demand signal, and spend your attention on the small number of situations that genuinely need a person. A same day cancellation with no pattern behind it. A group with requirements that break the model. A local story nobody could have forecast. Everything else holds its own ground without you.
Which means being willing to hold rate on a quiet looking Tuesday because the demand data supports it, not because you are being brave. There is a difference between conviction and stubbornness. The difference is whether you can point at the signal.
Automation should show its reasoning
Automation does not remove judgement. It removes the work that was eating the time judgement needs. Reconciling pickup across four reports, rebuilding a forecast for an ownership meeting, pushing rates by hand across every channel. None of that is revenue strategy. It is upkeep, and it is the reason teams stay in reaction mode.
The test I apply to any automated recommendation is whether I can see why. What signal moved. How confident the system is. What the alternative would have looked like. A number with no reasoning attached is something you either obey or ignore, and neither of those is revenue management. Advance, Duetto’s demand intelligence tool, was built around surfacing the demand story behind a recommendation rather than handing over the number alone.
Alex Tran, hotel manager at The Remington Orange, framed the outcome differently: “Duetto has already given us so much time back, time we’re using to do what we do best: provide exceptional guest service.” For an independent hotel that is the trade that matters. Less time rebuilding the picture after the fact, more time on the reason someone booked you instead of a chain.
One thing to try this week
Pick a date in the next 60 days where you are currently holding one rate movement across every room type. Split it. Price your standard rooms on what the pace is actually telling you, and price your top two categories independently on their own pickup.
Then look at the mix rather than the total. If nothing changes, you have lost nothing. If your suites turn out to have been underpriced the whole time, you have just found the money that was hiding inside the average.
Price like the hotel you actually are
Independent hotels have always competed by sitting closer to their market than a brand can afford to. Faster to read it, faster to act on it, answerable to fewer people before moving. Reactive pricing hands that advantage back and replaces it with the caution of a much larger business.
Certainty is the most expensive thing you can wait for. By the time the numbers remove all doubt, the part of that demand worth having has usually gone to whoever priced for it first.
I waited for certainty for years. The hotel I worked for absorbed it. Yours might not.
See what pricing to your own demand looks like at your property. Duetto helps independent and boutique hotels move from reacting to the market to anticipating it, with Open Pricing, demand intelligence, and profit visibility that goes beyond RevPAR.
Learn more about how Duetto helps independent hotels here.
