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 of every 100 in the first month to 12 of every 100 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.