Resort Room Rate Setup: Introduction
As a hotelier who has worked in resorts for almost over 17 years, See my Portfolio, I have seen how pricing decisions can make or break performance. Setting resort room rates is not about guessing — it’s a structured process. Over the years, I found that there are 4 practical steps that help every resort achieve the right price in the right season, amongst competitors, for the right guest segment.
In this series, I will explain these four steps in detail. Each post will focus on one element of the room rate setup process, building a complete picture of how resorts can design a strong pricing strategy.
The 4 Guiding Steps
- Resort Room Rate: Seasonality – Start with when to price. Demand shifts with seasons, so this must be the foundation.
- Resort Room Rate: Resort Positioning – Then define where you stand in the market compared to competitors (luxury vs midscale vs budget).
- Resort Room Rate: Room Type – After positioning, break down pricing by what you sell — room categories, views, and upgrades.
- Resort Room Rate: Segment – Finally, tailor rates to who you sell to — segments like leisure, corporate, OTA, direct, groups, etc.
This order flows naturally: Seasonality → Positioning → Room Type → Segment
= When → Where → What → Who ✅
Follow along as we begin with Seasonality in the next section.
What is Seasonality?
Seasonality is defined as a pattern of seasons that repeat themselves predictably over time. Seasons are periods during which demand for a property or market is similar and constant, or is significantly different from demand periods around it.
Why Define Your Seasons?
Identifying a property’s seasons is an important factor in being able to proactively price correctly at all times of the year. Seasonal pricing helps reduce the risk of having inappropriate rates during different seasons, and it lowers the chance of turning away customers who might have booked had the proper price been set for those dates. Understanding the importance of seasonality helps you target seasonal timeframes when it makes sense to capitalize on revenue opportunities by adjusting rates either up or down. In general, as occupancy and demand fluctuate, so too does the opportunity to adjust pricing.
How to Define Your Seasons
Seasonality is determined by using a variety of tools to identify and analyze trends in occupancy and demand. To define your property’s seasons, complete the following steps:
- Review recent performance data such as Occupancy, Average Daily Rate (ADR), and RevPAR charts over the last 12–18 months compared with competitors.
- For each chart, draw vertical markers to indicate logical seasonal breaks.
- Evaluate and compare the markers you have drawn:
- Do the Occupancy and ADR graphs validate the current seasons?
- Do the Occupancy and ADR graphs mirror each other? If not, why?
- Do Occupancy trends between your property and competitors align? If not, why?
- Do ADR trends between your property and competitors align? If not, why?
- Do RevPAR trends between your property and competitors align? If not, why?
- Based on your assessment, you may identify opportunities to redefine some of your seasons.
- Keep in mind that hotel occupancy alone does not reflect total demand. It is important to compare occupancy trends with demand turndown data or booking inquiries declined to validate your findings.
A Few Important Facts About Seasons:
- In many markets, weekday and weekend seasonality must be viewed separately depending on customer mix.
- Season dates can be as short as a few days or as long as one year, but they must be contiguous.
- Date ranges may start and end on any day of the week; however, many properties align rate changes with weekend or weekday cycles.
- The number of seasons can vary by region, market, and property. Many resorts operate with four key seasons: Low, Shoulder, High, Shoulder.
- Seasons may differ by customer segment (for example, transient versus group).