Benchmarking: Moving beyond traditional comp sets and year over year comparison
— 15 experts shared their view
For years, revenue managers used historical data as a "compass" to navigate rates and inventory. Due to the pandemic, however, historical data lost much of their relevance, as 2020 and 2021 were statistical anomalies, to say the least. In this scenario, other information became more important, such as on-the-books reservations, pick-up, pace, and, of course, comp set. Some hotels have closed and consumer behavior has shifted.
The challenge, however, is how to clearly identify the proper comp set: is there only one or multiple competitors? How should a hotel judge it's performance, when most of the traditional KPIs have become meaningless?
When thinking about comp set there are two points that come to mind. The first one being the flexible nature of a hotel's comp set. The hospitality landscape is ever evolving and with new accommodation-, workspace- and function space providers on the rise things are moving quickly. Secondly, it's important to take a look at the big picture as you might be surprised to see with whom you are competing. In Meetings & Events you sell square meters (or ft, of course 😉 ). The competing sqm's could be located at a nearby hotel or they might be located at the nearest WeWork. Commercial real-estate providers will see office space freeing up with more people that will continue to work from home. Will they introduce some event- or meeting space as well? The best way to find out who you're competing with is to ask potential guests and organizers which other parties they are considering. Doing so will allow you to send out the most competitive offer.
If you want to benchmark KPI's it's important to compare apples to apples. I've had interesting conversations about Meeting Room Occupancy. It's almost impossible to calculate correctly as you are selling per hour or day-part. In Meetings & Events “revenue per available square meter” is a straightforward option that leaves little room for interpretation and error.