For the hospitality sector, hotel revenue-per-available-room (RevPAR) is the driving business metric that is based on multiplying a hotel’s average daily room rate (ADR) by its occupancy rate.
Many hospitality providers use RevPAR to measure their performance over time, as well as to compare themselves to the competition.
For the extended-stay category, this business metric is typically very similar to traditional hospitality providers. However, this year, there is a surprising development…
According to Mark Skinner at Hotel News Now, the extended-stay hotel average daily rate grew 7.2 percent in each of the first two quarters in 2012. This is considerably faster than the 4.4 percent gain the overall hotel industry reported for the first half of the year.
There are several possible reasons for this growth such as guests like the built-in kitchen facilities, more then one room and the overall residential atmosphere. Many of the services often include grocery outlets or convenience stores, and lower daily rates are more common.
This data also tells us that extended-stay providers can also see enhanced business results by investing in the right innovations to help retain and attract more guests. Whether it is through more in-room technologies like iPads, enhanced WiFi or through new CRM techniques with “Predictive Guest Marketing” or PGM, extended-stay providers can further drive up overall RevPAR numbers.
Conversely, traditional hospitality providers can look at this data as an opportunity to enhance their business efforts by implementing the right innovations. Of course, extended-stay guests have different needs than traditional hotel guests, but the core tenet of better providing the best service though technology has never been greater.
In any business, there are a number of metrics, extend beyond core revenue, that provide a snapshot into overall performance. RevPAR does exactly this for the hospitality sector and investing in the right innovations that support overall business goals can help ensure that this number goes up annually.