Understand What You’re Up Against
How to Conduct a Hotel Competitor Analysis
To understand how to stand out amongst competitors within your area you must first understand what you’re up against. The best way to get a good idea of local competition is through a competitor analysis. After you have completed this then you can assess what your property brings to the market.
What is a Competitor Analysis?
A hotel competitor analysis allows your property to compare strengths and weaknesses against other local properties. Allowing you to find what your point of difference is against your competition and use that to potentially increase your market share.
Be Critical
The best way to understand how you shape up against other properties is by being hyper-critical of your property and the properties around you. Don’t fall into a false sense of perfection. The best way to understand the strengths and weaknesses of your property is through customer reviews. By getting the honest opinion of your guests can identify what they look for in a holiday destination and what makes your property stand out. Take negative reviews graciously, as this allows you to fine-tune areas of your service and product offering that may not be up to industry standards.
What Purpose Does a Competitor Analysis Serve?
Thoroughly analysing your competitors is a strategic imperative, offering a valuable lens through which to identify tactical opportunities for your business. Moreover, it unveils pathways for enhancing your services and refining your overall strategy.
Other benefits:
Identifying your Point of Difference
Find what makes you different, this could be a variety of different things. It could include unique architecture/location, a vibrant environment, or a personalised guest experience just to name a few.
Compare Services
Find what services and different amenities you offer compared to the local area. Do you need to remove or add anything to your property?
Making Informed Decisions
By looking through reviews and exploring OTAs and other websites, you can begin to understand price points and other property’s Points of Difference. This allows you to position yourself in comparison to the market.
It’s now easier than ever to complete a competitor analysis. With a diverse range of different tools available for public use, it allows you to check rates and availability of properties. Making it highly accessible for you to identify strengths and weaknesses to target. In-depth competitor analysis creates the opportunity for you to maximise revenue.
What Properties Should You Analyse?
When analysing local competitors, you should only be investigating properties similar to yours in star rating, size and pricing. It is still important to investigate the bigger/successful properties in your area and see what is working for them and if you can implement similar services. However, when it comes to local analysis you should be analysing your direct close competition. Listed are some factors that can help assist in narrowing down your analysis:
Price – Properties with similar pricing to yours are a good place to start. Analysing what services and room types they are offering for similar pricing to yours can give you a better understanding of your position in the market.
Location – Properties that are in close proximity to yours are important to look into. Even if this means they may be different in size or pricing. Depending on the size of your town is what determines how many properties are included within your proximity.
Experience – Properties that offer a similar experience to you, if you are a bed and breakfast are there other similar properties in your area? This allows you to take price out of the equation and look at the intricacies of their hotels. What services and amenities do they offer in compassion to your own experience?
Discovering your direct competition is the beginning stage of your competitor analysis. Once this step is completed the competitor analysis truly begins.
How to Perform a Competitor Analysis
With your list of competitors, you can now begin the analysis, remember to be thorough and honest. As you are using this information to better your property. The research process may be difficult at times and remember to check various channels including OTAs, Google Hotels and their website.
Strengths and Weaknesses – To truly assess the strengths and weaknesses of a property you need to compile a list of different areas that will be assessed for each hotel. This could be anything such as price points, facilities, amenities, or cleanliness. Being broad in this section allows you to truly assess the differences between your property and your competitors.
Opportunities – The opportunities that you identify should be a result of what you previously found in strengths and weaknesses. Due to the broad nature of this subject, you must be concise and realistic. To be realistic consider the following:
- What are your business goals for the year?
- Are there gaps in your service?
- Do you have the resources to make these changes?
- What do your competitors bring to the market?
Threats – When identifying threats in the market it is noted that threats are changes that are out of your control. This would include things such as a new hotel opening across the street from you or a shift in travel trends. Some threats can arise from nowhere, so keep this to events you could see happening, don’t make it too broad.
Benefits of a Competitor Analysis
When you have completed your analysis, this is when you have some decisions to make about your property. Listed are some outcomes you could expect after finishing this process:
- Understanding Your Position
After this process, you should have a good idea of where your position is in the market. This can allow you to alter certain messaging within your business to play to your strengths and fix minor weaknesses.
- Understanding Your Price Point
If you establish your strengths and weaknesses correctly this allows you to adjust your pricing as such. Guests are willing to pay for a service if they deem it to be appropriate for what they receive. If this means lowering your profit margin to then drive bookings it might be a change you have to make.
- Adjust for Industry Standard
If there are services or amenities that all your competitors are offering that you aren’t. This is an opportunity for you to make a change and comply with the industry standard. Or if identified that your staff training is weaker in comparison to competitors, take the time to get your staff up to date and working at a higher capacity.
- Target Audience
Your competitors may have valuable insight into potential guests during different seasons that you haven’t accounted for. This can then allow you to change your target demographics during different periods throughout the year. Also allowing for targeted packages and deals depending on who is prevalent during certain periods.
- Gain Insight on How Others Sell
By exploring other properties OTAs and websites you should have established a good idea of how different people market their properties. You should then cross-check this with your marketing processes and make changes where you see fit. Understanding different processes that more successful properties undertake is the initial step of growing your property.
Closing
It must be mentioned that this process is no simple task and may take hours of research and planning. However, at the end of this process, you will have key industry insight that many of your competitors won’t have. Allowing you to make informed decisions on your property’s future and gain a competitive edge over local hotels.
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