Central reservation systems are something that many modern hotels use. Owners and operators often find them to be quite beneficial.
In this article, we will discuss central reservation systems, explaining what they are and how they work. We will also briefly compare them to some other tools that hotel operators often utilize in the modern era.
A central reservation system is a variety of reservation software. Generally, it is used to maintain or update hotel inventory or rate information. The purpose of this is so hotels can manage their guest reservations in real-time.
Those who use it generally do so because they want to centralize their data. They can do this from every one of their connected distribution systems at the same time. For instance, a hotel’s booking engine and property management system might feed data into the central reservation system.
When a hotel consolidates so much data, it can become a highly useful tool. A hotel owner or manager whose intention is to refine their revenue management strategy will most likely find such a tool an excellent resource as they attempt to streamline their business model.
One of these systems keeps track of reservation data as it comes in. A CRS will transfer reservation data from the property management system or systems to the distribution channels in real-time. This means that the hotel can reach guests across as many channels as it needs to.
If you look at it in this way, you’ll see that a central reservation system acts in a similar way to a channel manager. A CRS often has more features than a standalone distribution solution, though.
It would be safe to say that a central reservation system does not have as much performing power as an integrated hotel commerce platform. However, that does not mean it doesn’t still have plenty of uses.
Hotel booking engines are not quite the same as hotel central reservation systems. You might sometimes hear individuals in the industry use these terms interchangeably, though.
Now, let’s move on to talking about how a central reservation system works at a hotel.
As we mentioned earlier, a central reservation system works by collecting enormous amounts of data. It brings in that data from many different locations and stores it in one easily accessible location.
Let’s say a hotel has many sales and distribution channels, as so many modern ones do. The CRS is a way of connecting all of those to each other. It is the job of the CRS to safely record and store all of the reservation data that comes streaming in from so many different sources.
The point of this is so inventory can quickly be updated. If everything is working smoothly within one of these systems, then inventory will be up-to-date and accurate at all times throughout the global distribution system the hotel uses. You can imagine how much easier this makes operating a hotel.
Let’s imagine for a moment that a would-be guest is using your hotel reservation system to look at and book a room. They give you their credit card information, or perhaps they decide to pay using some other method.
When they give you their payment information, that triggers the property management system, or PMS. This system automatically updates itself. Another part of the system, called a channel manager, implements this step.
At that point, the central reservation system comes into play as well. It automatically updates all of the room listings that you have on the various reservation websites with which you have partnered.
You can also use the central reservation system to scrutinize the data regarding your guests and their tendencies. That raw data can be exceedingly useful as you’re figuring out what guest segments to target most aggressively through ad campaigns, email marketing, etc.
That’s not all a central reservation system does, though. It also pushes availability and updated rates to any of the various distribution channels that a guest might use to book. Again, all of this is happening in real-time.
For example, maybe you want to update a group rate because you’re running a special or promotion of some kind. If you do this within your CRS, it serves as a method of updating all of the group rates throughout the assorted distribution channels you are using.
The new rate will almost immediately be reflected on your connected OTAs, in your PMS, and in your own direct booking engine, assuming you’re using one.
A CRS may also be capable of cancellation and refund management. If someone needs to cancel, the CRS will monitor that. By doing so, it can quickly make a room available again that a would-be guest has decided to give up.
You can program a CRS to automate the refund process as well. This way, you don’t need your employees to handle it, and you can allocate those resources elsewhere.
A CRS can also be useful when it comes to group bookings. Maybe a guest needs to reserve multiple rooms for a wedding, a family reunion, or some other event. You can set up a multi-room booking feature with a CRS.
It will facilitate this process. All the necessary arrangements are made effortlessly. Again, you probably won’t need to allocate any human resources toward this type of booking unless the individual reserving a room has some sort of special request that requires human interaction.
Email notifications are another integration that a central reservation system can often handle. Your system can send payment receipts and regular booking confirmations. However, it can also send out an automated email moments after someone has booked a room through one of your available channels.
These emails can also be used for things like upselling and cross-selling. You can get feedback through these emails. You can also use them to send out personalized offers or for promotional purposes. The possibilities are virtually limitless.
Many central reservation systems for hotels also come with things like your hotel’s mobile app, channel manager, and booking engine already integrated. This can save you both money and time. You are essentially connecting separate products. You are also providing better cooperation between different modules.
While you can use an OTA to get bookings, they charge money for this service. That is why many hotel owners will try to encourage direct bookings from their would-be guests as much as possible. A direct booking system, usually consisting of both a booking engine and website, can be a CRS integration.
A CRS that comes optimized with a booking engine is therefore paramount. It helps to look for one with all of the content management capabilities ready. If you get one, then all you have to do is customize its appearance so that it matches the brand identity associated with your hotel.
Having a central reservation system that makes online payments easy is a must-have as well. If your CRS comes with secure payment options, that will make a potential guest much more willing to pay for their reservation that way.
Such a payment method is usually a booking engine feature. If you have a CRS with a trusted payment gateway and provider, that is something your possible guests should be happy to see.
Your CRS might also have the capability of accepting multiple kinds of currency and communicating with individuals who speak different languages. If your hotel is a favorite for international travelers, you can see how this would make sense.
Automatic currency conversion features are a part of many of the best central reservation systems. Many individuals who try to book with a hotel become frustrated if they see the rooms listed in a currency with which they are not familiar. Having a system in place that will easily change the cost of a room from one currency to another might very well get you more bookings.
Having a CRS that is tied into your hotel’s mobile app, if you have one, is also something that many guests will look for if they’re trying to book a room with your hotel. An app is usually more user-friendly than a website your guest can access via a desktop or laptop. Having a CRS that works in conjunction with your hotel’s app indicates you have your finger on the pulse of modern technology.
Through your app, someone might control room settings, make payments, check in and out on their own, etc. If you are monitoring all of those activities through a CRS, you can mine that data and use it to make the guest experience more enjoyable next time.
Now, let’s briefly compare central reservation systems to some of the other tools that hotel owners use.
You can look at the tools you use as a thriving technology ecosystem. In that context, a central reservation system sits between the property management system and your distribution channels.
The property management system helps your staff members manage things like front-desk operations and back-office duties. Meanwhile, your distribution channels include things like your hotel’s website, a global distribution system (GDS), and online travel agencies (OTAs).
The CRS can be regarded as the go-between. It connects whatever distribution channels you’re using to your property management system.
In this respect, you can see that a CRS and a PMS are not identical to each other. While the two terms can’t be used interchangeably, they are connected in a meaningful and necessary way.
There is also a relationship between a central reservation system and a GDS, or a global distribution system. A global distribution system is an extensive computer network. It connects potential travel bookers with travel suppliers. A hotel could be considered a travel supplier.
A GDS is useful because it provides data in real-time on availability, product, and price. Other agents and distributors can refer to it whenever they need to.
Where a global distribution system links a hotel’s inventory to business travel networks and agents, a central reservation system is being operated by the hotel itself. Much like the relationship between a CRS and a PMS, there is a healthy working relationship between a CRS and a GDS. While they are not identical, they can both be working parts of the hotel’s ecosystem and business model.
To recap a few of our central points, a central reservation system helps with such aspects of your hotel’s business model as ease of distribution, adjusting your rates and availability, and managing cancellations and refunds. You can also use one to handle multiple bookings.
The transference of data to the various distribution systems your hotel uses keeps your room listings updated. The synchronicity between your CRS and PMS means you don’t have to divide your attention between multiple platforms. This simplicity is every bit as crucial as the data collection that is also such a huge part of a CRS and how it operates.
If you’re not using a central reservation system for your hotel yet, now is a great time to look into one. You’ll want one that has all of the features we mentioned, and possibly some others as well that are more in line with your particular hotel and business model. Remember that all central reservation systems are not identical, and you might see one with features that are not completely aligned with what your hotel prioritizes.
If you’re someone who’s running a hotel but is not that familiar with software or computers, finding a CRS that is as intuitive as possible is in your best interest. Many of them are created with simplicity in mind, though, so it’s likely you can locate one that you can easily learn how to navigate.
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