Daily market share data takes revenue management strategy to a whole new level
Market share benchmarking is without a doubt one of the most important metrics used today by Revenue Managers, Hotel Managers and Owners.
The Hotel industry mainly compares the following three factors: occupancy, average room rate (net) and RevPAR. These are used for evaluation in relationship between the own hotel and the competitor hotels. The three KPIs resulting from the calculations are: Market Penetration Index (MPI), Average Rate Index (ARI) and Revenue Generating Index (RGI).
Daily Benchmarking against a set of competitors is a unique opportunity to measure the effectiveness and accuracy of your own business strategy. It allows for an analysis of the impacts of your pricing and segmentation strategy on your RevPAR in comparison to the defined competitor hotels.
Benchmarking shows whether your own RevPAR is growing stronger or weaker compared to its competitors. It also allows a detailed analysis through which leverage the RevPAR has been increased since the occupancy and ADR are also shown. In this way the effect of a new pricing strategy or a desired segment shift can be clearly measured.
An internal comparison of KPIs to other periods and years is not enough to assess whether the hotel is performing great or not. It is important to compare your KPIs to a defined set of competitors through proactively examining the daily benchmarking numbers. This is the only way for hoteliers to recognize what phase the market is in and can accurately estimate their own growth and adjust the strategy if necessary.
The insight into the compset’s strategy is an indispensable tool especially for the highest revenue days, e.g. fairs and events. The daily benchmarking report shows the competitor KPIs and their growth rates for each of these days, allowing you to analyse their strategy, evaluate it and optimize your own strategy accordingly to stay ahead of the competition.
The use of daily benchmarking data has become an indispensable tool in modern revenue management. It is only on this basis that the full potential of a hotel’s performance can be derived per day of the week and the strategy adapted accordingly. An analysis based solely on internal data cannot deliver the same achievements.
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