Price and duration, or length of stay, are the two fundamental levers for revenue management. Successfully striking a balance between the two by managing length of stay is how you get your hotel closer to full occupancy.
See if you can achieve 100% occupancy in our Fill Your Hotel simulation by clicking the game below.
There are several different types of length-of-stay controls. One thing you might want to use during a busy period is called a “minimum length of stay.” Let’s say you have four busy nights and that you’re going to have some slow periods. You’re trying to decide which reservations to accept at the beginning of those four busy nights. If you have people who are willing to stay four nights, you’re going to be a lot more open to having them at your hotel than someone who’s only willing to stay one or even two nights.
Of course, leveraging length-of-stay controls is a delicate proposition: The last thing you want to do is turn away demand to the point where you end up with empty rooms.
To better understand how length-of-stay controls actually work, we suggest you try your hand with the Fill Your Hotel simulation, used in eCornell’s course, “Forecasting and Availability Controls in Hotel Revenue Management,” taught by Dr. Sheryl Kimes. This activity simulates a length-of-stay tool as it relates to variable demand and overall occupancy rate.