Case Study $1$: Playoff Time

Hotel Sport is a $250-$room independent suburban hotel located close to a sports stadium. The stadium

has a capacity of $25,000$ and it serves as the home field of the local Major League Soccer $($MLS$)$ team,

while also hosting college football games on occasion. Hotel Sport is a select service property in the

midscale category.

Its rate structure is simple:

Rack $$190$

Weekend $$159$

Low season$/$Government $$140$

Groups $($of $15+)$ $$130$

BAR $$120$

Late August is traditionally low season in the hotel. Demand usually picks up after Labor Day, when area

businesses and government offices are back in full swing. The hotel has more group business during the

summer and it faces less transient demand. The sell rate in late August is the $$140$ Low Season rate.

In our mini$-$case we consider handling reservation calls on two consecutive days: on July $29$ and then on

July $30.$ On both these days we will deal with bookings for the same late August weekend. For the

weekend of August $2426$ the forecasted occupancy is around $130$ rooms. Reservations on the book are

ninety guaranteed and twenty$-$five non$-$guaranteed reservations, plus the hotel expects fifteen walk$-$ins.

There is no indication of any special demand drivers for late August when July $29$ arrives.

Discussion Questions

Question $1$

$1.$On July $29$: What rate should the revenue manager approve to quote for reservation inquiries for the

weekend of August $2426$ based on the information above?

$2.$On July $30$: There is exciting news: the Major League Soccer franchise of the city has just clinched a

spot in the playoffs. The news travels fast: it is all over the sport shows on television, it is the headline

news on the sports pages in all local papers, and it is all over the internet. The first game in the

elimination round will be against the Los Angeles Galaxy, which features the world$-$famous superstar

Steven Gerrard in its lineup. The first leg of the home$-$and$-$home series is going to be played in the local

stadium on August $25.$ All the hotels in city are filling up fast and phones with reservation inquiries are

ringing off the hook at the Sport. The hotel$$s website has crashed as the booking engine could not

handle the sudden increase of volume. Things became hectic in a matter of hours at the Hotel Sport.

What rate should the revenue manager approve to quote now for group reservation inquiries for the

weekend of August $2426?$ Are there any stay control measures that should be considered?