August 26, 2016
Occasionally a hotel owner will say to me that they rarely even look at the STR, (STR, ie, Smith Travel Research) report which shows ADR, Occupancy, and RevPAR data for the last week to 4 weeks, and the monthly report which goes back for 12 months at least. Also useful are the franchise ranking report, and the Medallia report of guest satisfaction ranking. Not reviewing this data regularly is a missed opportunity to study your market performance and your hotel's performance, regardless of the size of your hotel, or the size of your market. Doing this can yield actionable knowledge that can help you improve your hotel's performance and maximize revenue.
If your franchise provides STR reports, take advantage of this data. Look at both the weekly and monthly STAR reports to keep your fingers on the pulse of the market occupancy, average daily rate, and revenue per available room. Use the information to answer questions like, are you maintaining market share? Review your pricing, did you overprice or underprice rooms in the last period? If you overpriced rooms, did your occupancy or RevPAR suffer as a result? Or conversely, if ADR was steady but occupancy was up or down, were there any groups, conferences or large events at your hotel or the competitors? Did you miss an opportunity to drive higher rates when you were 100% occupied?
One reason owner’s may not use the STR Report is that they don’t feel that it is an accurate reflection of their market penetration. Usually this is because the hotels used in the competitive set are not true competitors. So, change the competitive set. STR Inc. allows hoteliers to customize their competitive set, with some limitations. Most brands also will allow you to get 2 STR reports with 2 different comp sets if you are willing to pay a little extra each month. This can be very worthwhile for some hotels. Choose the hotels that are similar size, age, and chain scale, or those closest geographically.
STR Reports are always scrutinized by buyers before making an acquisition. It’s an important indicator of market demand and supply changes, the hotel’s relative performance, and the opportunity that a buyer may be able to take advantage of through significant improvements or even a brand change, that will allow the hotel to capture greater market share. By monitoring these reports, you can make adjustments and improve performance, maximizing revenue now and maximize value whenever you decide to sell the hotel.
Another report to review is the franchise brand ranking reports, which are published monthly. Use this report to compare your hotel to other hotels in the same brand. How does your customer satisfaction compare? How are you doing in your region? Use this information to discover the categories where your hotel could improve on it's relative performance. If cleanliness is bringing you down, then work with the housekeeping department to improve guest cleanliness ratings. The goal, of course, is to always try to be best in your region or at least to be improving.
Your franchised hotel probably also gets a Medallia report. Based on guest satisfaction surveys, the Medallia report will provide insight into different areas of the guest experience. For example, the speed of check-in, staff friendliness, comfort of the bed, etc. Medallia also provides trend analysis and a tool emphasizing frequency of common keywords.
Use your franchise reputation management portal, if available, to link to all third party online travel agencies, social media, and other sites so that you can manage your online reputation from one central location. If your franchise does not have a built in reputation management portal, keep a list of all sites where your hotel is listed to check manually. Create alerts, so you get notifications when there are new reviews, such as on TripAdvisor, Yelp, and Facebook. For sites without alerts, try to check twice weekly, if not more. Maintain your online reputation by responding, courteously, to all reviews. Take action based on reviews to make improvements in guest experiences. For example, friendliness or cleanliness can be address with re-training, or avoid long check-in lines by anticipating booking trends and having adequate staff on hand. 80% of travelers now look at a hotel online before booking. If your property had bad reviews, or worse – bad reviews without any management comments or explanations, then you are at risk for a decrease in business.
In the service business of hospitality, utilizing the information provided by these reports will inform better management decisions to improve guest satisfaction and property performance. In the next Blog, we'll discuss some simple revenue management techniques and data.
‘Till Next Time,