How to increase the ROI of a hotel? Real strategies to increase profitability
Increasing a hotel's ROI does not depend on a single action, but on the simultaneous optimisation of multiple areas: dynamic pricing, operational efficiency, loyalty, direct marketing and, above all, technological integration. This article outlines specific strategies aimed at improving ROI by applying specific tools such as RMS, PMS, CRM and BI, with the objective of maximising net profitability per available room and minimising dependence on low-contribution channels.
What is ROI in hospitality and how is it calculated?
ROI (Return on Investment) in hospitality measures the profitability of the investments made, whether in refurbishment, technology, marketing or personnel. It is calculated using the formula:
ROI = [(Net benefit generated by the investment - Cost of the investment) / Cost of the investment] × 100
Example: If a large chain invests €40,000 in a new booking engine and generates an additional €60,000 in direct sales, the ROI is 50%.
Measuring ROI allows you to make data-driven decisions and prioritise those actions that generate sustained profitability.
Real strategies to increase a hotel's ROI
Optimise your tariffs with smart revenue management
An efficient revenue management system automatically adjusts prices based on demand, advance booking, competition and customer segmentation. RMS such as Lybra and Rateboard, both of which can be integrated with leading PMSs, allow you to maintain competitive ADR without sacrificing RevPAR.
- It implements dynamic real-time tariffs.
- Segment prices by channel, origin, anticipation and customer type.
- Reduce OTA commissions by optimising visibility without dependency.
- Prioritises cost-effective distribution mix and assesses acquisition cost per channel
Reduces structural costs without affecting the guest experience
Cost reduction should not compromise the perception of service. Automating operational processes (check-in, housekeeping, upselling), together with energy efficiency, can lower costs without degrading the experience.
- Monitor and optimise energy consumption with IoT tools.
- Automate repetitive tasks from the PMS: no duplicate guest profiles, room allocation, upselling.
- Review contracts with key suppliers (laundry, amenities, distribution) to adjust margins without affecting quality.
Improve your direct channel and reduce dependence on intermediaries.
The direct channel offers the highest contribution margin per booking, but requires an efficient technology structure, a clear value proposition and a sustained digital strategy. The priority should be to shift high acquisition cost bookings to a hotel-controlled and optimised environment.
- Transactional website with SEO architecture: It is not enough to have a visually attractive website; it must be designed to attract, retain and convert qualified traffic. Integration with the booking engine must be seamless and frictionless.
- Optimised booking engine: Vertical Booking and Simple Booking allow you to customise prices, apply rules by device, origin and lead time. Direct connection to the PMS ensures real-time availability.
- Frictionless funnel: Minimise the number of clicks needed to book. Eliminate unnecessary fields, show comparative rates and add urgency modules (room counter, users watching, etc.).
- Exclusive offers and added value: Offering a direct channel discount is not enough. Add exclusive benefits such as upgrades, breakfast included, flexible cancellation policy or gifts.
- Retention in own channel: Capture mail from the first contact. Use retention pop-ups, remarketing and cart recovery to avoid leakage to OTAs.
- Multi-channel strategy without cannibalisation: Coordinates Google Ads campaigns (Brand, GHA), metasearch and email campaigns to reinforce the direct channel without eroding the average rate or engaging in price wars.
Build customer loyalty with data and personalised service
A well-integrated CRM with the PMS allows you to segment your database, send personalised communications, manage loyalty programmes and automate post-stay campaigns, increasing your return rate and customer lifetime value (CLV).
- Provides upgrades, details and messages on key dates.
- Apply automated marketing based on past behaviour.
- Design loyalty programmes integrated with the booking system and CRM.
Use digital marketing campaigns with a focus on profitability, not just visibility.
It is not enough to generate traffic: marketing must focus on conversions and return. Local SEO, SEM with tracked ROI and remarketing campaigns must be integrated with the booking engine for real conversion analysis.
- Segment campaigns by customer value, not just clicks or impressions.
- Invest in technical SEO, local content and strategic linkbuilding.
- Automate email marketing with retargeting rules from the PMS/CRM.
- Track conversions with UTMs linked to the booking engine.
Invest in technology to make data-driven decisions
Technology is not an operational cost, but a direct investment in decision making. A well-integrated hotel technology ecosystem allows you to analyse performance in real time, identify profitability leaks, automate demand response and plan accurately.
- Unified technology stack: Eliminate islands of information. The integration of PMS, RMS, Channel Manager, CRM and Booking Engine must be bidirectional and in real time. Solutions such as Zucchetti Hospitality Group enable this interoperability.
- usiness Intelligence applied to the hotel: It's not just about reporting, it's about detecting patterns. Visualise critical indicators: projected vs. historical occupancy, channels with better net conversion, real cost per acquisition (CPA), lifetime value by segment, etc.
- Predictive models and alerts: By connecting BI to the PMS, alerts for anomalies (peak cancellations, low conversion, ADR drop) and automatic adjustment recommendations can be configured.
- Data-driven automation: From room allocation to daily pricing. Every action must be governed by structured data. This reduces errors, response times and reliance on human judgement.
- Real-time profitability monitoring: Access essential KPIs from any device: GOPPAR, RevPAR, ROAS, CLV, daily pickup. Compare by room type, market origin and channel.
- Data-driven decision culture: Hotel management must operate as a tactical, not reactive, intelligence unit. Technology turns scattered data into direct competitive advantage.