Optimization Settings

Consider using the following optional settings:

  • Cancel/Re-Book Percentage: allows G3 RMS to consider revenue losses from a price reduction, when guests cancel their reservations and re-book at a lower rate.

  • Optimization Method 2: applies if you want G3 RMS not only to inform you of arrival dates with LRA impact but also to close temporarily BAR availability for those dates.

To see the history of changes, such as who updated the settings and when, click export .

Cancel/Re-book Percentage

Enable the Cancel/Re-book Percentage option if you want G3 RMS to consider revenue losses from a price reduction, when guests cancel their reservations and re-book at a lower rate.

By default, when G3 RMS determines pricing, it doesn't expect that guests cancel and re-book if the price drops. The system drops the price if that brings more revenue overall. When you enter a cancel/re-book percentage value, G3 RMS compares the rewards against the risks of lowering prices:

  • Reward: based on the expected remaining demand for each price point, how much more revenue you gain from a price drop.
  • Risk: based on the cancel/re-book percentage, how much revenue you lose from existing On Books business.

G3 RMS considers those factors in its optimization and selects the optimal price. It only drops the price if the rewards outweigh the risks.

Setup Steps

  1. Click , then Property, and then Property Specific.
  2. Click the Optimization Settings tab.
  3. Enter a percentage value in the Cancel/re-book percentage field.
  4. Click Save.

Best Practices

Enable the functionality if:

  • You are concerned that you lose revenue because your guests cancel and re-book after price reductions.
  • You don't think you lose revenue, but you are concerned that pricing gets lower as the arrival date gets closer. For example, some clients set a strategic high percentage to avoid "educating" consumers that the longer they wait to book the reservation, the lower the price.

Determine the optimal value

G3 RMS doesn't collect any personal information from reservations. Therefore, it can't track which or how many guests cancel and re-book. You could track such information by comparing cancellations against new reservations for a given booking date. Or you might have this information available from a frequent guest program.

The value is meant to be an estimate. We recommend that you start with a low value, for example 5% or 10%. Or, if available, base the value on actual cancel and re-book data.Then observe the impact on the number of pricing reductions for a period. Compare that to what you observed before the change. If price reductions don't decrease enough, increase the amount by 5% and observe again. Continue until you find an acceptable level.

Note: 

  • When the Cancel/Re-book feature is enabled, the system considers revenue losses only for some market segments, those that you attributed as "Unqualified" or "Linked to BAR."
  • Early in the booking curve, this feature has little impact on price reductions. That's because, with little or no business on books, there is no business that can cancel.
Detail Description
Days to Arrival
Revenue Threshold For Price Minimum forecasted revenue gain that you require before G3 RMS can reduce the price. For example, if you select 1% and G3 RMS forecasts 100,000 total revenue for this occupancy date, then a price drop only occurs if it increases the revenue forecast by 1,000.
Maximum Price Drop The highest value that you allow the price to drop, if the two other conditions are met. ​

Optimization Method 2

This alternative optimization method is not beneficial for most clients and the module is not visible by default. IDeaS contacts clients that may benefit from this feature to discuss the considerations. Optimization Method 2 only applies if you want G3 RMS not only to inform you of arrival dates with LRA impact but also to close temporarily BAR availability for those dates.

For more information on LRA impact and the available LRA options, see Last Room Availability (LRA).

Setup Steps

  1. Click .
  2. In the Property section, click Property Specific.
  3. Click Optimization Settings.
  4. Select Enable for Optimization Method 2.
  5. Click Save.

Best Practices

  • Compared to the default optimization, Optimization Method 2 is better at considering when different types of future remaining demand book. Thus, with regards to LRA, G3 RMS can better react to dates when it forecasts that the remaining demand for low-value LRA business will book earlier than high-value BAR business and will potentially displace that high-value BAR business. In the case, this method should lead to better decisions and higher revenues.
  • Optimization Method 2 leads to less stable decisions, meaning that the system’s decisions change much more frequently in between optimizations. These changes are partly due to the increased complexity from considering when different types of remaining demand book, but also because this model explicitly plans to implement different pricing approaches over the booking period for each arrival date. More frequent decision changes may make monitoring G3 RMS more time consuming.
  • When Optimization Method 2 is enabled, remaining demand values may no longer be aligned with the occupancy forecast. Due to the differences in how remaining demand and expected occupancy are calculated in Method 2, on-books plus remaining demand can sometimes be less than the occupancy forecast.
  • Consider when your LRA business typically books versus when your BAR business books. If both have similar booking windows, then the ability of Optimization Method 2 to better react to dates with LRA impact may be outweighed by its disadvantages. Consider this method if LRA business usually books earlier than BAR business.