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MIHM203 Hilton Hotel and Resorts Revenue Management Assessment 2 Answer

Assessment 2 Part  2 Outline

Assessment title: Case Study Assessment
Assessment weighting: 60% Part 2: 30%
Assessment type: Individual case study
Word limit: 1500 Equivalent
Assessment instruction
As your Case Study for this Assessment: Choose a 4- or 5-star International Hotel. Imagine you are the Revenue Manager at this hotel.
Answer the below questions based on the information you have from this hotel. Provide creative answers to each of these questions with specific examples that could be used by the Revenue Team at this hotel.
Assessment format


Write an introduction to the hotel, including locationnumber of rooms and typespredicted target market, and competitors. Is it a seasonal hotel? When would be their peak demand periods? When would be off-peak?

Revenue Culture & Pricing

  • How do you believe the Revenue Management culture would be in this hotel? What pricing strategies do you believe they are using?
  • How do you believe the revenue management culture should be established in thishotel?
  • In your answer, discuss the hotel’s competitive set and analyse how the hotel is performing rate wise compared to the competitors.
  • How would you evaluate the competition?

Perceived Value

  • Discuss the difference between using perceived value as a basis for pricing and misleading advertising.
  • Give some examples of how this hotel could use perceived value.


  • Discuss the importance of forecasting for this hotel.
  • Explain how you believe the hotel would undertake its forecasts (including the steps you take to forecast, and data required to forecast).

Revenue Measurements

  • Compare and contrast the relative merits of RevPAR, RevPOR, GOPPAR and RevPASH as measures of performance.
  • At your chosen hotel, when would you expect the Revenue Manager to use each measurement and why?
  • What elements of the hospitality experience are not measured by these approaches?
  • Explain why the elements, not measured mathematically, are important to the business revenue stream, and how would you measure them?


Write a conclusion on your perception of the hotel’s overall performance revenue-wise and make any recommendations.

Note: You are encouraged to use a variety of artefacts to justify your answers.

Report formatting is required



Hilton Hotel & Resorts or Hilton Hotel is an international hospitality and hotel service provider, which has been headquartered in Virginia, United States. By the year 2020, the company has about 586 hotel properties with 215623 rooms located in about 85 countries. The hotel rooms of Hilton includes King guest room, King Deluxe room, guest room, twin deluxe room, executive, corner and presidential suites, the hotel also provides deluxe, king and luxury executive rooms for its guests (Hilton, 2020). Hilton Hotel uses psychographic segmentation for targeting ambitious and rich individuals who wish to express their luxury lifestyle, status and achievements. The primary competitors of Hilton Hotel are IHG, Hyatt, Marriott hotels and Peninsula Hotels. Hilton Hotel provides every possible service to its guests from business trade to travelling, thus the hotel might not be considered as seasonal (Hilton, 2020). The peak seasons were usually the summits which favoured the company business although winter season was possibly down seasons for the hotel.              

Revenue Culture & Pricing

The revenue management uses the simple procedure to estimate future demands, pricing and occupancy rates, which reduce the use of complex budget methods.  The management of the company engages short term communication and analysis through revenue management, which helps to observe the performance gaps in the hotel (Camilleri, 2018). The revenue management analysis market behaviours and optimise the pricing of the firm to boost its sales figures. As Hilton Hotel, services millions of customers, revenue management is a necessary tool to simply analyse demand and supply of the accommodation services. Premium pricing strategy is applied by Hilton Hotel to keep its pricing high to define its luxurious services and accommodation quality aspects (Hilton, 2020c). The company maintains an exclusive pricing segment to enhance the attention of its target audience. 

The Hilton Hole performs in the international market with millions of customers to serve. The management of inventory and operations are quite tough to meet the demands and expectations of large targeted audiences. The revenue management is necessary to manage maintained and control the inventory system of the entity (Itani, Kassar & Loureiro, 2019). In the hospitality industry, there is rising competition from high to low budgeted accommodation service providers. Thus, demand forecasting and supply analytical assessment are necessary for the business to develop further. Revenue management includes functioning for forecasting the demand of customers and their changing preferences ad handles the supply according to it. These are reasons revenue management is necessary for Hilton Hotel.   

In the hospitality industry, the current competition has been driven by two specific forces changing preference and requirement of customers and changing advanced technologies. Due to the introduction of mobile applications, internet and other technological devices, the selection and comparison of hotels has been increased (Hilton, 2020b). The customers desire for more transparent information on facilities, services and prices. About 1 million estimated individuals use online source for finding out the best hotels and accommodation services. The changing environmental conditions have developed health consciousness and more natural bonding within the customers. It reflects the preferred choice and demands while selecting accommodations (Hospitalitynet, 2019). These forces providing scope to increase new hotels and striking the market share and performance space for already established brands in the hotel industry. Hilton Hotels are most valuable hotels in the market in terms of facilities, customer reviews and brand value. Hilton has a brand value of $7398 million in compare to Marriott $5039 million (Hospitalitynet, 2019). The Houlton Hotel has made a growth of 17% overtaking Hyatt, IHG and Marriott hotel brand value and market positioning.    

Perceived Value

Perceived value is an estimated and agreed value that a customer is willing to pay for a product or services. The perceived value is used by the entity in the pricing strategy for increasing intention of customers to purchase a product. The perceived value pricing is the amount a customer is comfortable to pay for a specific service or product in the market (Nowotarski & Weron, 2018). The perception triggers preference and choices of the customers in the market. The perceived value is used in the advertising for misleading the customer’s perception and desires to purchase the products. Unusually a comfortable price is advertised in front of the customer, while at time of purchase additional price like value added services, taxations and other costs are added to the product. In the case of Hilton Hotel, the accommodation service provide introduces seasonal offers, discounting offers, and vouchers to provide a perceived value for attracting its targeted audiences in the market (Bruni, Cassia & Magno, 2017). The seasonal offers include prices which are less than the average price range of luxury hotels operating in the market. 


Forecasting is a useful tool for estimating the future demands, supplies, operations, market condition and performance of the hotels. The usage of forecasting helps the hotel management of Hilton Hotels to ensure the estimated future performance of the entity. It provides brief information on the future-orientated demands and customer preferences (Chikoto, Ling & Neely, 2016). The Hilton Hotel might be able to evaluate the room occupancy rate and availability as per the accommodation demands. Thus, the pricing planning, supplies and operational planning might be conducted through forecasting tools. The forecasting provides a proper market scenario based on which the availability of accommodation services could be arranged by the Hilton Hotel for its customers in the market. 

During the forecasting, in the first place, it is necessary to identify a problem like rising market competition for Hilton Hotel. The data and information on customer demand, preferences competition performance and market shares help to analyse the scenario of the market problem (Camilleri, 2018). The collection of information includes data and information gathering through primary and secondary sources. The data such as frequency of customers to prefer hotels, sources they use to find a hotel, criteria’s of a selection of a hotel and decision making aspects of the customers. A preliminary analysis is conducted in forecasting for validating the information and sources are correct and useful. In the next stage, qualitative forecasting model is selected to generate information from published media, statistics and online sources (Itani, Kassar & Loureiro, 2019). The last stage includes data analysis and action plan, which provides findings on the forecasting made. The action plan considered a strategy to be introduced by Hilton Hotel as per the forecasted information to meet the market-related issue.  

Revenue Measurements

RevPAR is used for analysing the ability of a hotel to fill the occupancy or availed rooms at an average rate. It provides information on the brand value and image of the hotel in the market.  RevPAR is been used for evaluating the total capture per occupied room, it provides information on the spending habits of an individual (Hilton, 2020c). It provides information about profit earnings from each of the occupied rooms by the guests. GOPPAR analysis of the profit or income earned by the hotel after taking out all the expenses invested per accommodation room. This measurement tool analyses the income-earning of Hilton Hotel defining its performance. RevPASH is used to measure the performance level of each room to analyse customers satisfaction level. 

A revenue manager uses RevPAR while measuring the demand of the hotel, as this tool provides a frequency rate of filling of the accommodation rooms. The revenue manager uses this tool for observing potentiality of attracting the customers by the hotel. RevPAR is used by the revenue manager for analysing customer satisfaction level (Camilleri, 2018). This measurement tool provides earning from the investment made in each of the accommodation and furnishing. GOPPAR is used by the revenue manager for analysing the net profit, as this measurement tool extracts actual profit earned after deduction of all the investments made. RevPASH is used by the revenue manager to evaluate the potentiality of the product to attract a customer, as this method measures the performance level of the hotel room for a certain specific time period.  

There are some of the elements which are not measured by these revenue management tools such as brand value and positioning, required types of rooms, facilities and services, booking rates, customer preferences. The elements connect to the purchase intentions, sales and demand of rooms within the customers, so they are directly connected to the revenue stream (Itani, Kassar & Loureiro, 2019). The elements are not measured through mathematical evaluation as these elements are based on the behavioural approach of market and customer preference, needs and requirements. As there is an absence of figures or numbers, they might be measured through mathematical tools. The tools like customer review analysis, customer survey methods, demand forecasting, customer queries, website visits are some of the sources which could be used for measurement of these elements for the Hilton Hotel. 


The revenue management in the hospitality industry plays a vital role in measuring the demand and estimating pricing capacity of the hotel to attract customers in the market. Hilton Hotel revenue management is useful for measuring accommodation rates, occupancy rates, demand and supply balance of the hotel. The Hilton Hotel revenue manager uses analytical tools to examine company performance, although there are some non-mathematical tools are also considered to measure customer preference and demands. As per the recommendation, Hilton Hotel might require to increase technological software and systems such as revenue optimisation systems for increasing efficiency of revenue management processing and operational practices.

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