Southwest Hotel Group · Gaming & Hospitality · Las Vegas, NV · 14 weeks
Dynamic pricing AI deployed across 12 properties
Southwest Hotel Group relied on manual rate setting, using weekly competitor reports and past occupancy data. We developed and implemented a dynamic pricing AI for 12 properties that adjusted rates in real time. This system increased revenue by $3.8 million in the first year.
Challenge
The revenue management team relied on weekly competitor rate reports and 90-day occupancy data to set prices manually. This approach missed same-day demand shifts from local events, weather changes, and competitor moves. As a result, they were losing an estimated $3M to $5M in annual revenue from poor pricing decisions.
Outcome
We rolled out dynamic pricing across all 12 properties by week 14. Over the first year, this approach added $3.8 million in revenue compared to the previous manual pricing method. Meanwhile, the revenue management team’s override rate fell from 40% in the first month to 12% by month six, reflecting growing confidence in the model’s recommendations.
Results
- $3.8M Incremental revenue in first year
- 12 Properties on dynamic pricing
- 4 hrs Rate optimization cycle
- 12 of every 100 pricing decisions Override rate at month 6
We knew manual pricing was holding us back, but we didn’t expect it to cost $3.8 million in the first year. Now, the model pays for itself every month.