The hospitality space has come a long way. In fact, hotels now have a lot of new ways to track changing guest preferences and offer flawless experiences. And all it takes is having a great hotel management solution. In the hospitality space, the innovative concept of the 'Book Now, Pay Later' strategy has become mainstream.
And why wouldn’t it be – it is perfect for young and modern travelers that want balance and convenience. Besides, it’s a new game with high standards in the hospitality space. And it is time for hotels to abandon old school booking tactics to attain/retain modern travelers.
And this is what makes the ‘Book Now, Pay Later’ strategy paired with hotel software ideal. In fact, the 'Book Now, Pay Later strategy and hotel management software combo couldn’t be perfect.
A dedicated hotel management solution boosts guest satisfaction and revenue and supports growth. Anyhow, this methodology is spot on for hotels that want to offer flawless guest experiences and bump up their profit margins.
After reading this blog post, you will realize how “Book Now, Pay Later” model can help you reduce abandoned booking rates by removing upfront payment obstacles. Without further ado, let’s dive in:
Identify Your Audience
The hospitality industry continues to evolve and now specifically prioritizes the changing needs of their customers to stand out and achieve success. Now, understand that the “Book Now, Pay Later' approach can, in fact, work wonders for a direct hotel channel. But you first need to figure out “your” target audience.
If you’re a general manager, ask yourself, “Do you want to garner the attention of business travelers who want a straightforward planning process or families looking for suitable options? Remember, your audience can be a combination of both demographics.
So, what should be the focus of general managers looking for solutions to boost direct bookings of their independent hotels, increase overall revenue, and minimize dependence on OTAs? Managers should determine their buyers’ persona to roll out tactics that can drive engagement and resonate with their target audience.
An Objective Take on Pairing a Great Hotel Management Software
The benefits of adopting the "Book Now, Pay Later" strategy with dedicated hotel management software outweigh its challenges. Hotel managers, more than ever, should be aware of the perks and limitations attached to the ‘Book Now, Pay Later’ strategy.
Let’s dive into the essential pros and cons:
Pros
High Booking Conversion Rate
One of the perks of the ‘Book Now, Pay Later' strategy is that it increases your conversions. In fact, it straight-up allows guests to book their reservations without making an on-the-spot financial commitment. And this, in turn, minimizes a lot of reluctance among guests and increases hotels’ revenue stream.
Improved Guest Experience
The ‘Book Now, Pay Later' model allows mid to large-sized hotels to intuitively focus on the preferences of modern travelers and maintain operations around that framework. Besides, guests applaud the added convenience when they reserve, stay at your hotels, and finalize their payments. It is the main reason many guests get instant satisfaction and write 5-star reviews.
Guest Loyalty
A flawless booking experience is a new standard for hotels. It even gives hotels a chance to change their hotel’s preconceived perception of the market. Besides, there’s a good chance guests that had a great experience with your hotel will spread the word to others. Simultaneously, it will allow you to build brand advocacy and foster guest loyalty.
Insightful and Speedy Revenue Management
The ‘Book Now, Pay Later’ approach makes it easier to spot demand patterns and analyze data of multifaceted and diverse guests. You can analyze data to get insights that you can personalize to improve your hotel management strategies.
Here’s the thing – demand changes quickly. But when you’ve got a hotel management system – it’s not a bad thing. In fact, it allows you to turn the tables and be more strategic about your availability and pricing.
Cons
Can Make Operations More Complex
The "Book Now, Pay Later" strategy requires some learning curve. You have to be clear about communicating and tracking how this model is working to manage a plethora of reservations.
Can Increase Potential No-Shows
One of the downsides of the ‘Book Now, Pay Later’ approach is that it involves the potential risk of new guests not directly showing up. And that’s because there’s no upfront service payment. It can incur revenue loss and accumulate inventory amidst peak seasons.
Can Lead to an Unbalanced Cash Flow
This limitation depends on the current financial situation of your hotel. You'll notice cash flow gaps if you run small hotel operations and need immediate revenue to offer services.
What Elements Hotel Managers Should Consider
Before you decide to adopt the "Book Now, Pay Later" strategy, review your hotel’s unique condition and take into account critical considerations:
Demand Patterns
Review the demand patterns of the last few years and see “how” effectively “your” hotel can implement the "Book Now, Pay Later" strategy.
There’s a good chance your hotel may face more than a few occupancy fluctuations. And with the "Book Now, Pay Later" approach, you can boost your revenue stream even during slow seasons.
Hotel Market and Type
The "Book Now, Pay Later" strategy paired with a hotel management solution is a great model, but hotel managers shouldn’t generalize their target market and the type of hotel they run.
Booking Cancellation Policy
Hotel managers should have a predefined and fair cancelation policy to sustain high revenue without compromising guest flexibility. Make sure to communicate your cancellation policies to your guests from the get-go.
Tech Readiness
As a hotel manager, you’ll need to ask yourself whether or not you have the systems and technology to adopt and manage the "Book Now, Pay Later" integrated hotel management software.
The solution is simple – implement a solid hotel management software solution that can help you analyze nuanced and subtle cause-and-effects of delayed booking payments.
Best Practices and Standards to Implement and Maintain "Book Now, Pay Later"
Maintain Continuous Communication
Transparently and objectively communicate your hotel’s terms and conditions within the "Book Now, Pay Later" model to your guests. Make sure guests clearly understand your cancelation policies, penalties, and deadlines.
Seamless Integration
Also, integration of hotel management software is not just for the sake of it – you have to oversee its seamless management to have streamlined management and user-friendly guest experience.
Optimize Multiple Payment Alerts
Implement automated payment alerts and reminders so your guests don’t miss out on crucial payment deadlines. And this is how you deal with possible no-shows without compromising the guest experience.
Optimal Data Usage
Depending on the insights you get after reviewing booking patterns, make sure to adjust your availability, promotions, and pricing.
Why mycloud PMS?
It’s 2023, and mycloud PMS checks all boxes of the best hotel channel manager software. With mycloud PMS, you can streamline hotel operations and elevate your direct bookings.
Whether it’s an integrated booking process, automated communication, revenue optimization, or streamlined operations, you can count on mycloud PMS.
Conclusion
More tech advancements will create more opportunities for hotels to improve guest satisfaction through the 'Book Now, Pay Later' strategy paired with hotel management software. Think of it as an ultimate strategic move to make your hotel gain a more competitive edge in your circle.
And it all starts with combining the 'Book Now, Pay Later' strategy with compact hotel management software. If you want to take the next big step to transform your hotel’s success, seamlessly combine, adopt the 'Book Now, Pay Later' strategy, and invest in solid hotel management software like mycloud PMS. It will make it easier for your hotel to streamline booking operations altogether. With mycloud PMS, you can align your goals and run training programs so that your staff gets familiar with features and communicate them to diverse guests.
Step up your hospitality game and leverage the best opportunity to reshape the future of your hotel by booking the mycloud PMS demo right now.
