Budgets are complete, approved, and put to bed. Starting 2019 off right can set your full year up to success. Can you track your business on a granular level? Are you getting what you need from the data at your disposal? Are your channel code and room type management tactics optimal for your property? In a recent webinar we discussed these very questions.
Data is the puzzle that ties everything together. At its best, it’s the building block allowing you to track your business, manage your profits, and understand your customers. At its worst, it’s a waste of time that helps you manage nothing. In a poll administered during the webinar, 55% of respondents indicated the last time they evaluated their data was yesterday, and 30% said they evaluated data in the last 6 months.
One place to start in data evaluation is with market segments. If you lack proper segmentation, you miss on an opportunity to profit. Segmenting by only group and transient may not be granular enough to allow the user to easily see how segments are actually performing. Good data should allow your segments to extend beyond the market level, to the macro and micro levels.
Better data will let you drill into segments even further, allowing you to isolate issues down to the rate code level. In the matter of a few clicks you can see a detailed view of exactly where you are growing and declining. This can help you determine the success of your efforts or pinpoint losses. Either way you can adjust strategy to ensure you are pursuing the most profitable business. Are you at a granular enough level so you can track at the macro-level and have the flexibility to arrive at micro-level questions you need to answer?
Channel and source codes should be used to identify how the customer physically transacted – how they booked your hotel, not how they learned about your hotel. Too often as hoteliers we simply haven’t cleaned up this section. 20 years ago, a golf magazine may have been the venue through which a customer learned about your hotel, but it isn’t where they booked their stay. Between now and the end of the year is the perfect time to change the codes if needed and train staff on the changes.
For example, if you can only see Internet as a channel without a breakdown of whether guests came through web direct, OTA, or meta, then the data is ineffective. How can you manage your costs if you can’t track the business? Going one step further to delineate the true source will allow for more granular analysis of where your business comes from and how it flows toward profitability.
All too frequently we ignore room type performance assuming it will take care of itself. Hotels with limited inventory or inventory lacking diversity could get by with broad room type categories. But if you have more diverse inventory, being able to track room type versus a product category level will help you understand gaps in revenue performance. Have you ever sold more rooms but your ADR dropped, and not because you actively discounted? If you have, chances are it was a room type mix issue. I’ve worked at properties where we sold more rooms and made less money because we share-shifted inside of our room types.
Tracking your ADR and how it changes YOY at the room type level can help you identify this issue. Without the underlying segmentation, you won’t be able to translate your business into trackable, granular data.
For a detailed example of how rate management and current year versus prior year variance affects your bottom line, download the webinar here!