Analyzing a lodging operations ideal position and potential for success has been written about and postulated by some of the best marketing minds in the business over the last 75 years.

What has not changed is the way a lodging operation has to position itself vis-a-vis its product, market and competition and the way in which it can stay in business during a buyers or sellers market. This article will delineate the three most revealing approaches a general manager can examine and how he or she remains a vital force in the market for the short and long haul.

Overview

Despite the inordinate ways artificial intelligence has been used to solve problems and written about in the news since its inception, there remains a strong and steady method lodging operations can utilize that does not have a time limit on its application and assistance for long term success. That age old method consists of examining a property’s three most important ways to analyze its strengths and weaknesses. These are:

  1. The Product Analysis
  2. The Market Analysis
  3. The Competitor Analysis

So many factors enter in to establishing the character of hotels, restaurants, or other amenities that careful analysis of any one operation, though not complex, is a fairly exacting task. A good clear product and market analysis will provide a ready theme for any sales action that is planned, a richly fertile guide for business promotional ideas, and a more thorough and intimate knowledge of the product and market.

Further, in all selling and business promotion, one vital step is foremost before any sales action can begin. And this step involves a careful analysis of the product to be sold, a careful analysis of the prospective market and a careful analysis of the competition. This allows the manager to sharpen his or her skills and methods for attracting business, satisfying the guest while at the property and ensuring there will be return business in the future.

No two hotels, restaurants whether small, medium or large are identical. All are diverse and have clearly defined personalities. Therefore a complete and comprehensive plan for analyzing these facilities with a fine-toothed comb needs to be initiated and continued for as long as the property stays in business.

The owner or operator of his or her property may think they know their offerings like the back of their hand. However, the analysis of the product, market and competition will probably surprise them by points they may have overlooked. For example, a general manager believed there were 100 seats in the formal dining room when further inspection revealed that there were actually 120 seats in the formal dining room. These 20 extra seats can provide a serious amount of extra revenue over a short or long period. Or they may see an opportunity to expand the bar area due to an increased volume of business from local and area-related customers.

Here are presented the details of how ones goes about conducting a thorough product, market and competitive analysis for your property.

1. The Product Analysis

A product analysis consists of sitting down and honestly and truthfully answering questions about WHAT the lodging operation offers its current guests, patrons and potential users of the operations offerings and what they can expect as a result of the experience he or she had while staying at the facility. The following questions will measure the degree to which this facility complies with that product offering expectation:

a) How large is the property?

In other words, what area does the property cover in number of stories and frontage. Also, what is the total number of guests your property can accommodate?

b) What are your properties facilities?You will need to break down the facilities with regard to the following:

  • Number of guest rooms
  • Number of seats in the dining room, coffee shop and bars
  • Car parking facilities
  • Spa operation facilities
  • Meeting and conference space

c)What public space is available for parties, banquets, meetings, and conventions.

You need to identify how many people can each room accommodate with the exact number as they pertain to public rooms, the number for all meetings and the number for dinners.

d) What are the entertainment and recreation facilities provided by your property?

Discuss the size of the gym and its equipment. The size of the swimming pool and its amenities. The size of the spa and its guest accommodation services.

e) Where is your property located?

Give the population of the town, city or area in which the property is located. Also, what industries, business centers or attractions are nearby? In addition, what are the highways, expressways and airports that are close or the property?

f)When is business best and worst?

Discuss when business is best at what time of the year, on what days of the week, and at what hours of the day. Also, illustrate what your slowest business periods are annually, weekly and daily.

g)What is the atmosphere of your property?

Is it quiet and dignified, commercial and fast moving, expensively rich in appearance or quaint?

h)What is frankly and honestly the physical condition of your property?

Is it modern, clean and up to date? Or is it old fashioned but well kept? Does it need to be painted? Is it old and rundown?

2. The Market Analysis

A market analysis attempts to answer WHO would and will use the facilities over the life of the property. It needs to be separated into market segments so your ability to recognize their differences and similarities can be made. The major market types of lodging users are commercial and business travelers, group, conference and convention travelers and tourist and transient travelers. These following questions must be answered as truthfully and honestly as possible:

a)Where do your present guests come from?

After looking at registration records, you can determine where the majority of your guests hail from quite easily.

b)How do your guests get to your property?

Do they arrive by car, train, bus, uber or others means of transportation? Also, what transportation systems aid in getting guests to your property?

c) Where are the concentrations of people located in relation to the distance from your facility?

What are the logical overnight shopping places a day’s drive away in each direction? Are there certain cities that generate large concentrations of potential guests?

d) Is there a new need not being met for lodging facilities to which guest rooms can be converted?

Do you need to evaluate your current amenities and determine if they need to be upgraded, modernized or replaced?

e)Who provides the attractions, business generators or other interests for people to come to your property?

Do the local, city or state tourism development offices contribute to adequately promoting your property now and for the future?

f)Who are your food and beverage patrons and do they frequent the property on a regular basis?

Create measurable customer profiles at your property and survey them as to their allegiance to continuing to patronize your facility.

g) Who are the types of people who live in the immediate neighborhood and determine where and when they eat and why?

Send out promotional flyers that provide discounts and free items to their local neighborhood areas to get their attention and possible use of the facility.

The Competitor Analysis

In conducting a competitor analysis, you should apply the same questions asked in the product and market analysis vis-a-vis your primary competition. You must verify this information in every detail by not guessing and pinpointing the exact data as accurately as possible. You may need to visit each competitive property and take note of any and all similarities and differences they present to your property.

This approach may reveal sales potentials you have not taken advantage of previously because you took them for granted. For example, one competitor may be offering a free night stay with every three booked. You may want to incorporate this promotion at your property to remain competitive. There’s no end to what you can discover at other property’s that can spell success over the long haul.

Conclusion

So many factors enter in to establishing the character of hotels, restaurants and amenities that careful analysis of any one operation, though not complex, is a fairly exacting task. This job of a product and market analysis can simplify all subsequent selling procedures. A good clear product and market analysis will provide a ready theme for any sales action that is planned as well as a richly fertile guide for business promotion ideas and a more thorough and intimate knowledge of the product and market.

The general manager or owner of a property may think they already know the property thoroughly. However, careful answering of the questions brough forward in this article will probably surprise them by bringing out points they may have been overlooked. The questions are purely elementary but must be answered most carefully. This old but tried and true method will serve you well if carried out as illustrated herein.

Reprinted from the Hotel Business Review with permission from http://www.hotelexecutive.com/.

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