HOSPITALITY AND TOURISM in India is one of the largest service industries.


The hospitality industry is a broad category of fields within the service industry that includes lodging, food and drink service, event planning, theme parks, and transportation. It includes hotels, restaurants, and bars.

In other words, hospitality is defined as taking care of guests and anticipating their needs. The hospitality industry refers to a variety of businesses and services linked to leisure and customer satisfaction. This industry focuses on ideas of luxury, pleasure, enjoyment, and experiences, as opposed to catering for necessities and essentials.


ACCOMMODATION-The accommodation sector of the hospitality industry is concerned with providing customers with a place to stay, on a temporary basis. It is most commonly associated with the tourism industry, where people book holidays, or trips and require lodging but the accommodation sector also caters to local people seeking short breaks from their everyday routine.

  • BED & BREAKFAST, also known as B &Bs, are small establishments, which offer overnight stays and breakfast in the morning.
  • HOTELS-Hotels cater to people who require overnight or longer-term stays.
  • MOTELS-Motels are similar to hotels but are specifically designed for use as overnight accommodation by motorists.
  • RESORTS-A Resort is similar to a hotel, but it will provide a wider range of facilities and amenities.
  • SERVICED APARTMENTS-Another form of accommodation that shares similarities with hotels, service apartments are self-contained units. These apartments will typically be fully furnished, will contain a kitchen, and may include various hotel-like services, such as laundry and cleaning.
  • TIME SHARING-Finally, time-shared accommodation is a type of accommodation where ownership or usage rights are shared between multiple people.


While food and drinks are necessities, most food and drinks services also fall under the hospitality industry umbrella, due to the fact that they offer people a way of spending their leisure time and disposable income, as well as an opportunity to socialize and enjoy an experience.

  • RESTAURANTS-Restaurants provide customers with food and drink services, with the food either being eaten in the establishment or taken away for consumption.
  • CATERING-Catering services are food services provided within a particular site, or in a more remote location, where food and drink are not necessarily the main service provided.
  • BARS AND CAFE'S-Bars and cafes provide customers with options to go out, socialize, and enjoy food and drinks.
  • NIGHTCLUBS-Nightclubs are one of the main ways the hospitality industry caters people in search of night-time entertainment.
  • TEA & COFFEE SHOPS-Tea rooms and coffee shops provide with a similar function to cafes, primarily serving varieties of tea and coffee as the name suggests.


Tourism is the sum of the phenomena and relationships arising from the interactions of tourists, business suppliers, host governments, and host communities in the process of attracting and hosting these tourists and other visitors.

This industry is a complex aggregation of many industries that together satisfy the various needs of the travellers, where every penny spent by the traveller contributes to the prosperity and development of the travel industry. Tourism is probably a rare instance 9of an industry earning foreign exchange without exporting national wealth.


Transportation, Accommodation, Food & Beverages, Special attractions (Man-made resources+ natural resources) for example- parks, historical buildings, rivers, lakes, mountains, beeches, also involved with another components like activities (meetings, business trips, shopping's), essential services (Health facilities, water supply, electricity supply), etc.


The hospitality industry and the tourism industry are closely connected, but there are also some subtle differences to be aware of. On a basic level, The Tourism industry is concerned with services for people who have travelled away from their usual place of residence, for a relatively short period of time.

By contrast, the hospitality industry is concerned with services related to leisure and customer satisfaction. This may well mean offering services to tourists, but it can also include the provision of services to people who are not tourists, such as locals enjoying their free time, or people coming to an area for reasons other than tourism.

Hotel market segmentation

Segmenting is a key aspect of revenue management. It allows you to differentiate between the travellers who are coming to your hotel and devise unique strategies for all of them. For example, the approach you take with young adventurers will be very different from a business professional. However, segmentation is more complex than simply business vs. leisure and you can use it to discover trends within your hotel business.

One of the best ways to identify and filter segments is by their reason for travel. Think family holiday, wedding, tourist event, adventure, relaxation, business, etc. However, more and more hotels are adopting a different strategy and defining the market segment by how a reservation was made, e.g. Expedia as a market segment. This is known as "blended segmentation" – combining the reason for stay and method of booking.

Hotel pricing strategies

There's no pricing strategy that is perfect for any hotel. Each property must consider the pricing strategy, or strategies, that work best for its particular brand. A revenue manager will spend a lot of time analyzing data and other influencing factors to ensure the business is operating with the best possible chance to maximize income.

There are a number of questions that should surround your pricing strategies:

  • What do your guests want?
  • Which strategy will complement the business mix?
  • How will different strategies affect connected channels and distribution partners?
  • How does your strategy integrate with your channels?
  • Who are the experts that can help determine the right strategy?

Let's take the first question as an example. Certain guests will prefer or be accustomed to particular pricing methods. For instance, some may like a cost breakdown of their stay by a day, while others are happy with a rate for their entire stay. This is where either Daily Pricing or Length of Stay pricing strategies might come into play.

With all that in mind, the first priority of pricing should be forecasting. This way you can predict demand so you can get travellers to book early. Then you can raise rates later as availability drops and demand increases. (This is an ideal pricing structure known as the "ascending model" whereby pricing increases closer to an arrival day.) We'll talk more about forecasting and analysis later.

Here's a list of the most common and effective pricing strategies you can employ at your hotel.

What is dynamic pricing?

Put simply, there will be days where supply and demand will be very different depending on the time of day. In the morning you may have lower rates because your occupancy is low, as is demand.

Many factors can drive this, such as competitors putting up their no vacancy signs or setting rates slightly too high, or travellers arriving late for events the next day and so on. You can raise your rates to take advantage of the shifting market and earn more revenue than if you'd kept your rates static.

What is an open pricing ?

Open pricing defines the flexibility hotels around the globe have to set their prices at different levels depending on the various target markets and distribution channels they deal with.

This luxury of choice allows hotels to forecast more accurately. For example, a high-end hotel may usually attract guests who no budget constraints but the off-season, bookings will drop and the hotel can drop rates to attract travellers who normally would not be able to afford the stay. While the average daily rate of the hotel will be lower, occupancy will remain steady and revenue will continue to turnover.

Other hotel pricing strategies:

There are numerous pricing strategies you can use at your hotel as part of your broader revenue management strategy, many of them in conjunction. Here's a list of the most common pricing strategies your hotel might find useful.

Value-added pricing

You can set your room rates higher than the local competition while also offering more extras in the basic package. This gives the illusion that the hotel offers a premium experience that focuses on value rather than just low rates.

Discount pricing

Used in slow seasons to boost occupancy by dropping base rates. Revenue can be made up of other services in the hotel.

Price per segment

Offering the same product at different prices to different types of customers. E.g. 'family rate'

Length of stay

When demand outweighs supply, it can help to implement a rule where guests are 'obligated' to stay a minimum number of days. In such cases, lower rates may not be necessary.

Positional pricing

Basing your rates off-brand strength and reputation.

Penetration pricing

Positioning you as the cheapest in the market. Be mindful of how travellers will perceive your hotel – you need to retain the opportunity to sell at higher rates.


Positioning your hotel among the most expensive. Price leaders often achieve among the highest profitability, however, the consumers need to clearly understand the reasons that they would pay more for staying at your hotel.

What is revenue management for the hospitality industry?

Revenue management refers to the strategic distribution and pricing tactics you use to sell your property's perishable inventory to the right guests at the right time, to boost revenue growth. Other products such as your amenities and food and beverage offerings will also come into the picture.

Revenue management revolves around the measurement of what customers from different segments are willing to pay, and this can only be done by measuring and monitoring the supply and demand of your hotel rooms.

Every traveller has a maximum value they can offer your hotel; revenue management is about capturing as much of this value as you possibly can. Preferably you'll do this by convincing the guest to book direct, purchase extensions, up-sells or extras, and become a return visitor.

The best strategies are based on the understanding that hotel pricing is fluid, and can change from one day to the next. This is why you should never be afraid to increase your rates. Customers actually expect increases over time – most businesses where consumers spend money are varying their prices based on demand and shifts in costs.

Effective hotel revenue management strategies can also help hoteliers:

  • Better manage resources
  • Protect against roistering too many staff during slow periods
  • Ensure adequate numbers of staff are working during the busiest times

With all this in mind, revenue management can drive the entire business plan when implemented effectively. Your hotel distribution strategy is also a vital part of your revenue management plan. Make sure you are on the internet distribution channels that promote your destination online. They have the strong marketing power and can put your hotel in front of many customers you can't contact directly.

How to increase hotel revenue:

Many strategies come into play when driving more revenue to your hotel, and many of them don't involve raising prices or playing with your rates much at all. Not least of these are satisfying your customer. If the product you offer is universally recognized as the quality, you have the grounding to charge a higher price.

If guests feel like they are getting maximum value for their money, it's very likely they'll be willing to spend more. Getting more out of each individual guest who stays with you is a great way to increase the overall revenue of your hotel. For instance, guaranteed revenue from a guest you convince to stay an extra night by discounting the additional night might be worth your while, especially in the low season.

Here's a list of general tactics you can use to improve your hotel's revenue stream:

Be bookable online

These days' travellers enjoy the flexibility, convenience, and value of booking online. By connecting to online travel agents/more online travel agents you'll easily see uplift.

  • Build a revenue culture that's on your revenue team? Everyone! Anticipatory service + proactive revenue-minded employee = emotionally connected customers with engaged loyalty and higher revenue returns.
  • Sell other hotel products
Revenue opportunities extend far beyond simply selling your rooms. Think about the amenities you have on-site and what you are charging for them, and go even further by offering hotel guests the chance to purchase items like soap, utensils, towels, etc – especially if your hotel has a unique sense of style.

Leverage events and attractions

Local events and attractions are a great opportunity to put together packages for guests or offer additional services such as transport. The benefits are two-fold – guests will enjoy their stay more and your hotel will generate more income. As you move away from tactics and towards fully-fledged strategies around your revenue and room sales, you need to start understanding your key performance indicators (KPIs). Once you know what you should be looking at you can start analyzing the data and developing ways to manipulate them in your favor. The principle that you should always keep in mind is to assess market conditions in real-time and adapt accordingly.