Measuring your success in 2019

Kick your year off with metrics that matter the most

By knowing which metrics to track, hotels can actively understand how inputs reflect outputs, make Capital Expenditure decisions more effectively, empower staff with meaningful data, and incentivize behaviors that improve the health of the business. Metrics make hotels stronger.


What are business metrics?

Business metrics are quantifiable measures that track performance against established internal objectives or external benchmarks. They allow you to track progress towards a defined goal or benchmark. Metrics make sense of the business; the best metrics reveal how well a business is progressing, and identify opportunities for improvement.


How to define success:

Success isn’t uniform, it’s something that must be defined first at the property level, and then (for some) at the brand level. Not every property within a market or category defines success in the same way. That’s why the first is to define what success means to you. Ask yourself:

  • What expectations does management have?
  • What targets have been set?
  • What personal goals do I have for my property?
  • What are the macro trends at both the market and regional level?
  • Are we up against headwinds or is the wind at our back?

These answers form the backdrop to the next step: defining success. Once you have a well-developed definition of success for you and your team, the next step is to identify the metrics that best represent the levers available to you. Similar to goal setting, defining success is all about being SMARTER.

This commonly-used approach ensures alignment of your team; organizational buy-in is absolutely essential to motivating a team towards a shared vision.

“The definition of success varies greatly depending on the type of hotel, location, target customer, and brand image. For some hotels, success might mean having high occupancy all year round, others might be focusing on driving more direct bookings, or increasing loyalty by generating more repeat business, while others are focused on profitable revenue growth. No single metric will tell the whole story so it’s crucial to define what success means for your brand or property.”

– Tim Sullivan, Chief Revenue Officer, Cendyn


What makes a good metric?

By knowing which metrics to track, hotels can; actively understand how inputs reflect outputs, make Capital Expenditure decisions more effectively, empower staff with meaningful data, and incentivize behaviors that improve the health of the business.


What metrics work for your team?

Every property and/or brand is distinctive. Take these ideas and apply a mix that works best for your specific circumstances. Many metrics overlap across departments, underscoring the importance of inter-departmental collaboration. Aim for at least one non-traditional metric. It might require some inventive thinking to create (and track!), but will give you a memorable asset to use when marketing your new metrics-driven approach internally! Here are a few examples you can use at your hotel based on your department:



VIP Score
Assign a to score individual travelers; the higher the score, the more frequent the traveler and/or likely the traveler is to spend money. This score can then be used to target dynamic content according to the perceived value of the guest.

Revenue per employee
Reveals how efficient your operations are being compared with revenue. This metric can help catch slipping productivity before it becomes a big issue.

New vs returning guest
Loyalty is an important metric for operations. A great experience fuels returning guests.

Guest satisfaction scores
These internal measures of guest satisfaction don’t always translate cleanly to a guest’s public review of a property. Collected directly from guests, these scores are often more honest and revealing.

Employee churn rate
Employee turnover has a direct impact on the guest experience. Track your progress and align your management team around it.



Raw star ratings
The hotel’s reputation, based on its raw star rating, has a direct impact on bookings. A well-rated hotel is preferable to both OTAs and guests, so this metric usually has a direct impact on revenue.

Review/social sentiment
Knowing what your guests are saying about your hotel publicly gives you the data you need to make decisions, such as where to invest limited capital to improve the property and guest experience.

Conversion rates
There are several important conversion rates to track: newsletter signups, email open rates, email click through rates, CTRs for specific marketing campaigns, “look to book” ratio for website traffic.

A straightforward view of how engaging your content and promotions are. Spikes in unsubscribes should always be investigated.

Device types
Hotel marketers need to know what their customers are using to view their emails; is their customer base actually preferring mobile to desktop? Marketing messages must be optimized accordingly.


Revenue Management

Booking abandonment
If they have visited your site 5 times and every time looked at the spa page and three of those times left after seeing rates, you know you need to send them spa creative with an incentive (not necessarily a discount) to book.

Let them know you “hear” them and make it relevant; show them that you care. This can all be done with the right CRM and marketing automation platform.

OTA vs direct
Given today’s technology, it’s fairly straightforward to track the percentage of business booked through third parties (OTAs, wholesalers) compared to direct. Hotels should aim for direct to be their majority source of business and always a higher percentage than OTA bookings.

Customer acquisition costs (CAC)
When a guest books on the third party channel, the commission paid out is effectively the cost of acquiring a customer. For direct bookings, this would be the cost of a marketing campaign that converts lookers to bookers.

This metric blends all of these efforts to ensure that your cross channel marketing strategy is delivering results. All things being equal, lower is better.

A measurement of how effective marketing spend is being when compared to average daily rate (ADR) This metric can identify marketing overspend and/or over-aggressive rate setting.


Your work towards organizational alignment through access to data will pay off. This transparency builds trust, which then triggers ownership of the results. People start striving in the same direction and want to make a positive impact on the numbers. Consider adding a real time dashboard for everyone to review in staff common areas.

Empower and energize your team with data rather than silo and separate.


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