Revenue management, answered

Am I getting enough extra revenue back to justify what I pay for revenue management each month?

You are if your portfolio is consistently outperforming your local comp set on both occupancy and ADR, not just one. If revenue management fees are not returning a clear multiple of their cost in measurable RevPAR lift, the engagement is not paying.

By Jack Murphy, Head of Revenue Management at UpRev. Running pricing for US vacation rental managers since 2017.

The Right Benchmark Is RevPAR, Not Occupancy Alone

Many managers celebrate high occupancy without noticing that ADR was sacrificed to get there. RevPAR, revenue per available rental night, captures both sides of the trade-off and gives you a single number to track month over month. Pull your comp set data from your market reports and compare your portfolio RevPAR trend against theirs across the same periods. If your RevPAR is flat or lagging the market, that is a direct signal the pricing strategy is not working.

How to Structure the ROI Calculation

Take the incremental RevPAR gain your portfolio has produced since the engagement started, multiply it across your total available nights, and compare that gross revenue lift to what you are paying monthly. A credible revenue management engagement should be generating a meaningful multiple of its fee in added owner revenue, enough that your owners notice improved performance statements. If you cannot point to a clear before-and-after RevPAR improvement with the same or growing portfolio, you are likely not getting full value.

What to Ask Your Revenue Manager Right Now

Request a performance review that shows your portfolio RevPAR indexed against your market, broken down by property tier and season. Any revenue manager worth retaining should have this ready without you chasing it. If the data is not being tracked at that level of detail, that is itself an answer about the quality of the service you are receiving.