Kronen Hotels: How the Norwegian hotel group increased its ADR by 20%

Nobody will argue that the pandemic was a difficult time for hoteliers the world over. 

But those who made it through successfully and have thrived since then, have a few things in common. One of them is their desire to innovate. Another is the foresight and courage to use this crisis as a chance to reset and reimagine their internal processes. 

That’s exactly what Chris Pedersen, CEO of Kronen Hotels did, and it has paid off massively. 

We recently spoke to him about how he and his team used the lockdown to transform their workflows and their business overall. In this conversation, he highlighted the critical role Atomize plays for Kronen Hotels since travel restrictions eased and demand returned. 

On top of that, Chris shared how modern hotel tech makes it easier and more fun to face post-pandemic challenges. 

About Kronen Hotels

  • Company: Kronen Hotels
  • Location: Norway
  • Property count: 5
  • Type of properties: A mix of historical, self-service and business hotels

Based in Sandnes on Norway’s west coast, Kronen Hotels is a privately-held group with five hotels, two restaurants, a catering operation and facility management services. Their focus on providing a unique and fulfilling experience centered around inviting accommodation and dining concepts has allowed them to build a strong local brand presence. This attracts leisure guests as well as business travelers from small and medium businesses in the region and beyond. Given their ongoing success, Chris and the management team hope to further expand the group’s footprint.

Making the most of downtime: Building a tech stack from scratch during the pandemic

Like many other hospitality businesses, Kronen Hotels used to rely on cumbersome legacy systems.

“We were locked into an old digital infrastructure. It was costly, inefficient and rigid. We couldn’t tailor it to our needs and knew change was necessary. When everything came to a standstill during the pandemic, we decided this was the time to get rid of our old systems and start over with a blank slate. The goal was to lower our costs and create smoother processes. And that’s exactly what we did,” Chris remembers. 

First, Kronen Hotels worked with Innovation Norway, the national development bank, to create and implement a plan for the company’s complete digital transformation. The first step was to build a digital platform with an open API as a basis for the group’s tech stack. Here, the aim was to allow each of the hotels to connect the systems needed for their operations. 

“We wanted the ability to implement new systems as necessary without facing high integration or exit costs. Our new platform created the base for that. Next, we implemented Mews as our PMS and continued to build our tech stack around it. Since demand was low, we could dedicate enough time to training our staff in using the new systems. That meant the team was ready to go once business began picking up again,” he recounts. 

Creating this solid base was important to Chris since he believes our industry will stay turbulent for the time being. 

“Constant change will be the new normal and keeping up with it is the only way to stay ahead. Having the right tech stack makes it much easier and more fun to do that.”

Shifting to efficient, proactive revenue management

In the past, revenue analysts at Kronen Hotels would manually track market developments and create extensive reports. Then, together with the hotels’ general managers and the head office, they discussed pricing changes and revenue tactics. 

While this brought results, Chris wanted a more efficient process. His goal was to automate repetitive tasks like data collection and free up time to fine-tune the group’s revenue management strategies. 

“Atomize turned out to be exactly the system we needed. It automatically collects and analyzes live internal and market data 24/7 for the next 365 days. This saves us about ten hours a week per hotel, which comes to fifty hours per week in total. It also allows us to plan our pricing much further in advance than we could in the past,” says Chris.

Furthermore, the RMS helps Kronen Hotels recognize and capitalize on market developments as they happen. 

Atomize detects search patterns or market shifts much faster than we can. It uses these insights to give us new data-driven rate recommendations whenever demand changes. That has allowed us to go from updating prices only once or twice a week to changing them whenever necessary. As a result, we’re much more proactive and better able to capture demand and the optimal,” Chris elaborates. 

A new perspective on pricing and a drastic ADR boost

Kronen Hotels rolled out Atomize in April 2022, just as travel restrictions were ending for good. An automated RMS that offers real-time rate suggestions proved to be an invaluable tool during this phase of skyrocketing demand. 

“Without Atomize, we would have missed out on a lot of revenue when demand came roaring back in early 2022. We simply wouldn’t have been able to keep up with the quickly shifting booking patterns. But since we let the system set the rates, we increased our ADR by 20% compared to pre-pandemic days. It was fantastic how Atomize helped us make the most of the recovery phase and generate revenue from the get-go,” Chris reports.

But charging the rates suggested by the system wasn’t always easy for Chris and the team. Especially when the RMS recommended higher prices, they had to challenge their beliefs.

“We often asked ourselves: can we really charge this rate? In most cases we decided to trust the system and were rewarded for it. But we’re also aware that it’s up to us to deliver the quality of service that warrants this price. That’s why we keep focusing on improving the guest experience,” he explains. 

Here Chris also emphasizes how important it is to be realistic and use your best judgment:

“We always keep in mind the value we offer and only approve rates that are in line with our brand and pricing strategy. I like the fact that we still have control and can choose which rate suggestions to implement. After all, we know our guests and the market. It’s good to see that the human touch is still needed to fully optimize our performance and reach our goals,” Chris tells us. 

Using technology to address the staffing challenge

Kronen Hotels is no stranger to the tense staffing situation plaguing the hospitality industry. But Chris sees technology as a chance to create a more attractive workplace and retain talent:

“The pandemic made it hard for hospitality businesses to offer stable and secure jobs that attract great people. But even here, technology can be part of the solution. We’ve used new systems to automate boring manual tasks and lighten the load on the team’s shoulders. That makes work more fun, less stressful and leaves more time for the most important task – looking after our guests.”

Future outlook: the role of tech in creating high-quality guest experiences

Following the pandemic, travelers gravitate towards unique local experiences more than ever. This development encouraged the team at Kronen Hotels to double down on their efforts to provide a well-rounded stay experience. 

If we’re going to win tomorrow’s guests, we have to offer a customized seamless experience for every traveler. Data-driven guest technology is essential for that since it gives us new opportunities to personalize our services. Providing extra value and memorable experiences is something people are happy to pay for today. And Atomize will keep helping us find the optimal price level travelers are comfortable with,” Chris concludes. 

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