on 08 February 2010 
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GuestCentric Systems, finding that some prospective clients were unwilling to pay fixed monthly costs for its hotel-booking engine, implemented a new revenue-share pricing system.
For hotels with up to 100 rooms, GuestCentric Systems will make available its SaaS-based e-commerce management solution — including hotel-booking engine, analytics, CRM and social-media-monitoring tools — for a 6% revenue share, capped at $499 per month.
And, the company only charges the hotel client its booking fees when guests check out of the property.
For larger hotels or those with multiple locations, GuestCentric says it negotiates its fees on an individual basis.
GuestCentric, noting that no other fees are involved, claims this “best” in class pricing, enables smaller, independent properties to combine sophisticated e-commerce and social-media tools that previously might have been out of their grasp.
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Perhaps I’m mistaken, but this looks like a massive hike in prices.
My recollection is that under their fixed monthly fee model they charged $145 for up to 20 rooms.
At, say, $100 revenue per room and 50% occupancy, 6% of revenue = $1,800 per month ($100 x 50% x 20 rooms x 30 days x 6%).
So a 20 room hotel would hit the cap and pay $499 (compared to $145 before, if my memory is correct).
Maybe my numbers are wrong. But if not, someone’s done a great job of spinning a major price hike into a “good news” story.
I am sorry to say that I think you got it wrong Bruce. But I also must say that we are not the cheapest solution out there for someone looking for a plain hotel booking engine.
The GuestCentric solution is a top-notch e-commerce management solution: we deliver one of the best hotel booking engines in the industry, but also integrated revenue management, in-depth analytics, contacts and guests CRM and social-media-monitoring and monetizing tools.
To have access to all these tools in the previous pricing plan a customer would need to pay $499 per month (”Gold package”) fixed rate. Now, it only gets to $499 if you reach the cap.
This makes a big difference for most customers because demand is not constant over the year and percentage of bookings generated online varies significantly. E.g. customers that have seasonal properties will pay the $499 cap the months they are full, but $0 or close to it the months they are vacant. And can still take advantage of the Facebook booking engine, social promotions, Twitter Center and other unique features to promote their properties.
So, this new pricing enables customers that are not very well positioned online to get into the “game” with a top-notch tool without risk. This can be game-changing.
I think you must agree that it is indeed a great pricing plan for smaller, less sophisticated properties, especially in times of uncertainty.
Pedro – I see. So the old lower fixed-price bands didn’t include all the functionality, I understand.
Fair enough, though it does make the entry-level price higher now, I think (previously a 20 room hotel could have got at least some of the functionality for a lot less than $499 a month. Now they probably couldn’t, unless their revenue is very low). It was that thought which prompted me to comment.
Bruce