** Is it really profitable to pay for Revenue Management? **
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Hello and welcome to the channel I display Complete. I hope you're doing well. For those who have just joined us, if you discover I'm displaying Complete through this video, welcome to our channel which helps seasonal rental companies, professional sub-renters, and seasonal rental concierge services to increase their turnover with revenue methods management, also called yield management. Today, in this video, what I'm going to talk about is a question that was asked to me recently: if I invest money in the subject of revenue management, if I train, if I outsource this part, will I really make more money? Because yes, I want to believe that it will increase my turnover, but in the end, if I myself spent money to obtain this growth in turnover, well, what 'in the end, do I cover the costs? This is an excellent question, and I thought it might be worth making a video entirely dedicated to this subject. So, if you're interested in seeing my response to this, stick with me. If you are not yet subscribed to our private Facebook group called seasonal rental prices and maximization of turnover, then you have the link just below or above, depending on whether you are on Facebook or on YouTube, so you can register and join us, because we talk about all of these subjects on a daily basis. I answer the questions, myself, and then other people in the community answer the questions to help everyone towards increasing your turnover.
So, this famous question: in the end, will I really benefit if I invest in revenue management? That's a great question, and it's a very natural question. Myself, as a business manager, obviously I constantly ask myself this question whenever I have an investment to produce for my business, whatever the subject, whether it is a material investment , an investment in a service, or the recruitment of an independent, for example, for specific expertise, I obviously tell myself that it must ultimately be a win-win for the company, that the person who comes to provide us punctually his expertise can help us produce value, and that it is not just a zero operation. The question, in fact, behind all this, is: what is the return on investment of my investment decision?
In fact, there is a first point that I wanted to share regarding this. The question we need to ask ourselves, perhaps it needs to be clarified a little bit, is: am I going to make money compared to before? What is also necessary in revenue management is to be future-oriented. I am thinking in particular of covid. Where revenue management really performs is when it brings you more money than what you would have obtained in a context like the one you had before. I realize this explanation is a little twisted, but I promise you, the rest is a lot less twisted. In fact, in a pandemic situation, for example, revenue management will help you do much better, to maintain, to still have good performance, and still have turnover, despite, for example, the confinements . So, that's really the goal of revenue management: to do better than you would have done otherwise. But obviously during a period of confinement, if your performance is lower than that of last year, that does not mean that you performed poorly, and that is the importance of looking, and to compare yourself to what others in your market are doing. This is what is true. So. Closed parenthesis. I shouldn't have started with that because it's a bit twisted, but I'll share my answers with you on this subject.
− Hello Romain. Welcome to this live. I hope you're well. Romain, who is faithful to my Lives. Thank you.
So, the first point is that obviously, investing in revenue management produces money.
− Hi Delphine. Welcome to you. I hope you are doing well too.
Obviously, it saves money. This is the whole objective of revenue management. This is why we get up in the morning. This is our mission, at J’poster Complet. An illustration of this is that, for example, the contracts that we sign with the concierge services for which we work are non-binding contracts, that is to say that our clients stay with us because they think that obviously, we bring them more than what we cost them. Otherwise, there is no company, no normally constituted business leader who would continue to sign every month and pay for a service that costs him more than what it earns him. So on that, it's a point I care about, and which is in fact, in itself, proof of the performance of what we do.
Now, there are other elements, particularly if you want to train in revenue management, does that really help? I did a webinar a few weeks ago where I shared some customer testimonials, and I said to myself that this could be an opportunity to share them again. I'll show them to you on the screen. I'm going to share my screen. I had shared in particular the testimony of Axelle, who said: “For my part, I would like to bear this testimony that its turnover increased by 13.5% in 2020 compared to 2019. By having had a first disastrous semester, I followed Élise's training at J'poster Complet since September, and as a result, results: +13.5% in five months. Many thanks. » This, you see, is a message on Facebook that Axelle spontaneously sent. First of all, thank you to her for her testimony. There, we have another message which says: “Despite the confinement, our order intake indicator has marked a clear rebound since the start of the service…” So there, these are the names of the cities that I have hidden to obviously respect confidentiality. “…Thank you to the entire team for the quality of the work provided, and for the relevance of the strategies put in place. » I had other testimonies, too, which were interesting. No. That was definitely the statistics. I spoke about Yann's experience, and there, I copied and pasted from his channel manager. Obviously, I didn't create the graphics. It really comes from the channel manager, and in fact, the yellow line is the line from which revenue management was implemented, and there, we see the gaps. It's absolutely colossal. That's the end of 2020. We have exactly another similar example on a T5 in the west. Likewise, from the implementation of revenue management, it is absolutely colossal. There is another testimony that I can share with you, too. This is the testimony of Siem, who also participated in the training on revenue management, who says that last year, over the period, she had 868 euros, and she planned to make 1,000 euros. She implemented one of the methods in the training, which was also at the very beginning of her training. And in fact, she was able to obtain a turnover, in the end, of 1,544 euros. So last year, she made 868 euros, she set herself the goal of reaching 1,000 euros, and made 1,544. I'll let you do the calculation between her performance last year, and her performance of this year. And on top of that, she looked in the market at what others had done, was it, in fact, a performance that everyone had done? And in reality, not at all, since it had an excellent performance compared to the market which made 1240 euros. Those are examples. I have given you illustrations on service delivery. Here, these are two illustrations, too, from Axelle and Siem, on the online training part, examples which show that in fact, it pays off, and it pays off beyond the cost that it goes cost you. Knowing that in addition, if you want to train, obviously it will really pay off for years to come. I will have the opportunity to talk about it again later.
The second point is that it also saves time. That's important. If today you say to yourself: “In any case, today, revenue management doesn't take me any time. Not particularly. » That's when you don't do any, and in which case, there is an enormous chance that you really have a significant amount of money to be made by implementing revenue management. Because if you don't do that, that means you don't particularly have advanced event tracking, you don't particularly have an advanced pricing strategy, and maybe not an advanced length of stay strategy. And in fact, all these levers, once we put them in place, the advantage is that it pays off right away. So, if today it doesn't take you any time, it is very likely that you are sitting on dormant money, and that you simply have to go find it with revenue management methods. If, on the other hand, today it takes you time, then that means that revenue management methods will help you become more professional about the way you work. And becoming professional means saving time. Because you have seen, the person who is professional in something, he does it much faster than someone who is a novice. This is normal, because she knows directly what to look for, where to go, how to do it quickly. And this is what you will acquire by training in revenue management. You will have the same result as what you do in a time-consuming way, but with professional techniques, that is to say by saving a lot more time, by devoting energy precisely where it will produce its results. fruits. So, saving money and saving time.
And then, there is a third gain which is also important, to mention: it is the gain in credibility. If today, you are a seasonal rental concierge or if you are a professional sub-let, then the fact of being able to announce either to the owners as a sub-let, or as a seasonal rental concierge that you are accompanied by revenue management experts who help you establish the best pricing and optimization strategies to have the highest possible turnover, well that can indeed be reassuring. I would even go so far as to say that it can also reassure a banker to see that you put all the means to ensure that subsequently, the figures in the Excel table are true, are reality, and that you do not leave not like that at the drop of a hat on something which, in fact, is a profession, and cannot be improvised. So, earn more money, save more time, and gain credibility to allow you to move forward with confidence in developing your professional concierge or sub-let business.
Now, if you say to yourself: “Despite all this, I don’t necessarily want to act. » In fact, revenue management today is no longer an option, it is essential. It is an essential in the world of tourism, an essential in hotels, an essential in transport, etc. Everyone does it. Even at the SNCF, there is revenue management. It's a must in entertainment: Disney and the Walt Disney parks have been doing it for years, and Asterix Park too. It is truly, today, a must. Seasonal rental, it must be said, is a little behind this, because there were not necessarily, until the creation of J'poster Complet, actors who passed on knowledge in revenue management. But our activity is growing enormously, and in fact, it is one of the essentials of tomorrow. So ultimately, if you choose not to jump on this bandwagon this year, next year, and even worse, in the years after, your competitors will have jumped on the bandwagon. And you're going to miss things, you're going to miss out on information, performance. Because even if you remain at an identical performance, the others will sharpen their strategy, the others will increase their turnover, and will, in fact, steal part of the competence and market potential from you. So in fact, doing the same will risk being impossible, and we will tend towards the degradation of performance for those who are not aware of what revenue management is, of how to put it in place. Today, an actor like Club Med, for example, cannot fail to be aware of revenue management techniques, because all its competitors are, and not to do so is to take the risk of have a truly catastrophic financial performance. With seasonal rentals, it’s the same. So, being overtaken by our competitors, if we do nothing, is the risk we are clearly taking. And rather than an invariable performance over the years to come, we observe an erosion of its own performance.
And then the second point is also to be a little discredited in the future. Some time ago, I made a video on the Dunning-Kruger effect, which you can find on the J'poster Complet channel, which explains that when you don't have much knowledge about a subject, we pass what we call a mountain of stupidity, and a valley of humility. And then we go back up. That is to say, at the beginning, when we have little knowledge, we overestimate our own skills, and we even estimate our skills above the skills of experts. And then the more we learn, the more we realize what we weren't doing, and one thing leading to another, we become much more humble, telling ourselves that we have things to put in place and to learn. So, we must not be in the mountain of stupidity on this Dunning-Kruger effect. I remember, I shared it in the video, that at the time, when I discovered what the Dunning-Kruger effect was, I said to myself: “This is true, I have to be careful on many subjects. I am sure that I have this Dunning-Kruger effect, of overestimating my level of knowledge a little, when in fact, if I learned more, I would realize that in fact, I mastered nothing at all , and that I really have a lot to learn. » I even have other illustrations. I think you may know the story: Kodak, at the time, had on its engineering team an engineer who had developed the first digital photo system. It was a huge, massive thing, it wasn't at all the small devices we have today, obviously. And when he presented this to the board of directors, the board of directors did not credit his invention at all. They argued that no one would ever want to look at photos on a television screen, and that there was absolutely no future for it. While we know today how much Kodak suffered, precisely, from having missed this digital shift, and that today, it is still the number one way of looking at photos to look at them on a screen digital. So, there you have it. Let's not make the same mistakes as Kodak. Let's not miss this kind of train when it passes. For me, we are in exactly the same situation when I sometimes see certain people who wonder whether or not we will have to do revenue management. Today, if we ask ourselves this question, it is because we are doing the same thing as Kodak. We are missing something which is already today, but even more so tomorrow, an essential part of being a decent seasonal rental company. It's not even the elite of seasonal rental companies. No. To be a seasonal renter who carries out his job professionally, it is a must. I'm going to end with a sentence that I really like. Sometimes I remember it. You probably must know, I think: "If you find knowledge expensive, try ignorance." » I think this sentence is quite accurate, and I really like it.
I hope this could have answered some questions you might have. I find it interesting to talk about these subjects. It's interesting to ask these questions. I always welcome them with great pleasure. So if you have any questions like that, no worries, just ask me. I have no idea, actually, what questions might be to scratch it, for example, but don't hesitate to ask those questions. It will always be a pleasure to respond. Even if you think it might offend, frustrate, or hurt, ask me these questions as much as possible. It will be a real pleasure.
− Romain: “Is smart pricing on Airbnb a good thing? »
I'm going to make a digression. That's a completely different topic. Romain, do you know what I'm going to do? This will be the subject of tomorrow's video. That way, I keep the subject in stock. That's a very good question, and I'll answer it tomorrow.
− “Hello Élise. I don't know what revenue management means. »
What is revenue management? Revenue management is a method that has now been used for several decades and aims to increase the turnover of a service activity. In fact, at J'poster Complet, all we share is a set of methods that are used in tourism which are called revenue management methods, also called yield management methods. In fact, these are all methods that allow you to know how to determine your price to have the highest possible turnover. How to determine your minimum length of stay to have the greatest possible occupancy? How can we ensure appropriate household prices are determined? How to have appropriate cancellation conditions? Should we do promotions or not? So. A whole bunch of things like that, which ultimately aim to have the highest possible turnover. I made a video on what revenue management or yield management is, but it was a while ago, so I can do a little refresher on that. It seems important to me to remember, in fact, because it's true that on the internet, you can find a little bit of everything. I've already said it, but I have to say again that everything we share at J'poster Complet is really that. It's a job that I have been doing myself for over ten years, which I have done in different tourism companies; I worked at Louvre hotel, I worked at Club Med where I was in charge of a team of 15 people, and we optimized Club Med's 37 Europe-Africa villages, so a portfolio of eight hundred million 'euros. In fact, I was in charge of the Europe-Africa revenue management team. Why do I say that? Just to share that revenue management is something that has a solid foundation. It's not a fad when I get up in the morning. These methods are simple and accessible methods that we pass on for seasonal rentals, and that we implement on a daily basis for the concierge services for whom we work. We are currently optimizing more than 255 properties. In any case, today we work for ten seasonal rental concierge services. So. I hope this has shed some light on this point about revenue management, which is an extremely fair question. I will perhaps give a quick reminder on this subject of the definition of revenue management. What I could have said is that revenue management is the same thing as yield management, and hears more in the media yield management than revenue management. For what ? I don't know. The media have more affinity with this word, even though it is the old word. Today, in the field we rather say revenue management.
I hope this video was able to help you and enlighten you. Once again, if you have questions to scratch your head, questions that annoy you, questions that bother you, well ask them to me, it will be with great pleasure that I will answer them in a future video. If you are not subscribed to the YouTube channel I'm displaying Complete, don't hesitate any longer, click on "subscribe", and click on the bell to be alerted as soon as I come live, which will allow us to discuss together, and for me, to answer your questions. I wish you a very good day, and I'll see you tomorrow for the next video.