A revenue management system is a large company investment. We expect site teams to comply with this pricing and train them on what information they should be entering in our systems. However, you may hear that teams aren’t showing up to pricing calls or have failed to mention the road construction deterring prospects from visiting their property. If this sounds familiar, you do have a problem. But it may not be your sales team...have you hired the right person as your Pricing and Revenue Manager?
The most successful PRMs share certain qualities that give them the ability to effectively run revenue management systems, but also manage the relationships involved. Here are the top three qualities that ideal PRMs share:
1. Analytical Chops
It’s no secret that a successful revenue manager needs to have strong analytical abilities. In addition to basic understanding of supply and demand economics, we rely on the revenue manager to interpret complex data sets as well as do analysis outside of our core systems.
The successful PRM needs to have an appetite for analysis - not only to maximize your revenue, but also to help gain the trust of the operators they work with. If operators consider the PRM to be the expert on all things analytics, they will come to rely on their help and feedback. Not only does this help more clearly define roles, it can make this oft-mercurial relationship more pleasant.
2. Sales Skills
While having analytical skills may be enough to qualify a person to be a PRM in some industries; it is not the case in the multifamily industry. Due to the unique nature of our business, we still generally employ a face-to-face sales process. This makes for a great opportunity to learn buying behaviors and objections that can help us fine-tune our strategy. For that reason, pricing calls have become an industry norm where the PRM department talks to the site teams on a regular basis.
These conversations involve explaining the logic behind the pricing recommendations of a revenue management system in an approachable way. This is where a PRM cannot get by on pure analytical skills. While they don’t necessarily have to qualify as an extrovert, they do need the ability to sell.
Part of selling effectively is to speak the language of the customer (even if that customer is internal). The best salesperson will teach their customer, empowering them to understand rather than hoarding knowledge and information. Overwhelming site teams with spreadsheets and data isn’t going to gain automatic trust; it may even have the opposite effect. This approach also doesn’t acknowledge the reason to have pricing calls in the first place - the site teams know things that the PRM and the software don’t and part of a PRM’s job is to learn that information.
3. Conflict Resolution
If a PRM proves to be the source for analytics and has the sales skills to explain pricing and create buy in, the relationship between pricing and the field will likely be positive. Even so, there are slightly different incentives at work so “constructive tension” is still to be expected at times.
A successful PRM cannot be afraid of conflict. In fact, there may be times when they need to invite it. Pricing calls can become habitual, and everyone is busy. It may be tempting to “take the win and move on” if the field is okay with current pricing.
The disciplined PRM must constantly gather information to ensure we are doing everything possible to maximize revenue. The best PRMs will get out into the field to tour a property if a manager is being distant and not providing ample feedback. This is because a great PRM knows one final key piece of knowledge - it’s much easier to maintain a good relationship with someone when you are buying them lunch!