AI is driving hotel operating solutions in increasingly specific areas, one example being revenue management for group business. LODGING spoke with Maricarmen Cadenas, solutions engineer—the Americas, IDeaS Revenue Solutions, regarding the distinct advantages of this sophisticated type of revenue management tool.
1. Time Savings
Group sales teams who leverage an AI-powered RMS gain back time to focus on building relationships with event planners and tailoring proposals. “With the help of an advanced RMS, sales and revenue leaders can evaluate opportunities, confidently determine their strength, and accelerate negotiations,” said Cadenas. “Automation also accelerates multiday and alternative-date evaluations. For example, the system can instantly compare a midweek two-night pattern to a weekend three-night pattern, revealing which delivers higher total profit after accounting for displacement, ancillary spend, and space utilization. This removes hours of manual spreadsheet work.”
2. Error Reduction
Applying consistent, data-driven logic to every group inquiry, an RMS streamlines the process and eliminates human errors. “Instead of manually checking dates, rates, and forecasts, the system automatically validates room blocks, space needs, and revenue assumptions, reducing common human errors like misreading dates or overlooking compression nights,” Cadenas pointed out.
3. Wide-Ranging Data Sources
Historical group booking trends, future reservations, group blocks, market demand signals, and publicly available competitor pricing are all examples of the kinds of data that can be accessed by an AI-powered RMS, depending on the product. Incorporating group business data into forecast models “helps hotel leaders account for cancellations, no-shows, group demand, and group wash, ensuring forecasts reflect real-world behaviors,” Cadenas noted.
4. Maximizing Profit
Determining the most profitable combination of group and transient business is a calculation that is arguably best left to AI. “An advanced revenue management solution maximizes event space value by dynamically evaluating every booking opportunity against total profit potential—not just room rates,” she explained. “By forecasting unconstrained demand and applying intelligent pricing and space optimization, hotels can confidently accept the most profitable mix of business while minimizing revenue loss from displaced guests. This ensures every square foot of event space contributes to overall profitability.”
5. Informing Sales Strategy
An advanced RMS supports, but does not obviate, strategizing by sales leaders. Suppose the system determines that an event that would take place during a hotel’s peak season utilizes rooms that displacement analysis shows could probably be sold for a substantially higher price. “In these situations, revenue management and sales leaders need to take a collaborative approach and consider what’s best for business,” Cadenas advised. “Perhaps the risk of undercutting revenue potential from transient demand opens the door for requiring more hotel-friendly terms to secure the group booking. It shouldn’t be evaluated in a vacuum, though—potentially upsetting a group that consistently brings in business year-round might not be worth it.
Ultimately, it’s about making informed decisions and using your best judgment to mitigate risk.” She offered further examples of how an AI-enabled RMS can support sales teams in strategic decision-making: “If upcoming weeks look soft across segments, sales gains immediate justification to offer more flexible terms or negotiate aggressively. Conversely, if a group inquiry has date flexibility, the system can reveal alternative windows where the hotel would benefit more—maximizing both guestroom profit and function-space utilization.”
