The local hotel market can often be a fierce battlefield as properties fight to capture a similar type of guest. Maintaining a healthy profit can be very difficult, especially if your destination is highly saturated and your competitors are working just as hard as you to maximise their average daily rate.
You need to find ways to ensure your offering is the best it can be, comparable or superior to similar hotels in the area.
Here are five ideas for you to employ to remain successful in the growing travel industry.
1. Monitor your competitors
In a recent survey SiteMinder found that only 47% of hoteliers actually watch their competitors closely, while 49% were less vigilant, and 3% were not concerned at all. While it’s great to trust your own business plan, part of it must be based on the activity of your competitors.
This means you need to pay attention to their prices and promotions so you can respond in a timely and appropriate manner. For example, if you set a room rate at the same price as your competitors and one at a slightly higher rate, you can still attract deal seekers without completely sacrificing your opportunity for larger revenue.
Similarly, if you study their promotions you may find you can afford to offer better deals or extras and draw more guests to your property in the lead up to an event or busy time of year. You can also use your analysis to add value and increase midweek bookings.
Think about how you can give your guests that little bit extra. Note that constant promotion or discounting could devalue your property in the eyes of travellers so make sure to be strategic with your timing.
Here’s how you can keep abreast of your what your competitors are doing:
- Set up alerts and notifications for their rates with a pricing intelligence tool
- Sign up for their emails
- Follow them on social media
- Analyse their SEO and improve your own
2. Listen to your guests
The feedback you receive from your guests is extremely important. You need to work hard to secure fantastic online reviews because if you do, you have a justifiable bargaining chip with which to increase your rates.
In addition your guests will usually explicitly list your property’s strengths and weaknesses so you know where you can make improvement. They might even give you a good indication of how you compare to the local competition.
Ensure your frontline staff are constantly taking feedback onboard and reporting it back. Satisfied customers become free brand ambassadors so get as many onside as possible.
3. Expand your knowledge and management skills
The more you know about your profession, industry, and local market the easier it will be for you to make successful strategic decisions. There are multiple ways you can become better informed including:
- Catch up regularly with other industry professionals
- Educate yourself on any knowledge gaps
- Subscribe to industry newsletters
- Follow relevant and prominent figures on social media
4. Be introspective about your business
While it’s important to monitor competitors, copying them won’t get you anywhere. Focus on what makes your property special and emphasise this in your marketing to create a point of difference for potential guests.
Maximise your level of service to ensure the travellers you do attract become long-term customers. This will keep your direct bookings high, giving you more revenue and thus flexibility for your rates. Increasing your direct bookings will lower the cost of your distribution and boost your brand awareness.
If a new competitor arrives, resist the urge to immediately match their prices. Their offering may not be necessarily be more attractive and if they do bring more travellers to the area you can work on developing plans to capture a slice of their pie.
5. Capture data in real-time
When the market and your competitor’s rates can change at a moment’s notice, you need to need to be receiving the information you need instantly. With a pricing intelligence tool like SiteMinder’s Prophet, this data is immediately available to you.
It also enables you to track competitors and be alerted whenever they make a change to your previously created rules.
With a tool like this you can also perform your own forecasts and predict demand for the local hotel market, meaning the rates you set are more accurate and you won’t lose revenue.