“You can’t improve what you don’t measure.”
NB: This is an article from Asksuite
You’ve probably heard this quote before. But do you know what hotel sales and reservation KPIs (key performance indicators) you should focus on to sell more rooms while providing excellent service?
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Even though many hotel Sales & Reservation, Marketing, and General Managers alike agree with the quote, it can be difficult to decide which metrics to follow. This decision-making can be tricky and subjective as it involves service quality.
However, there are metrics that can show you the path to service excellence. Choosing the right KPIs is critical to ensuring sales increase and optimizing your hotel’s operations. Also, it provides a clear view of the hotel’s progress.
Could you identify your best sales agent? You might answer “yes”, after all, you control the number of sales each month. But is the number of sales enough to accurately measure and manage your team’s performance?
Once you know which metrics to monitor and track, you can make better-informed decisions to help your sales & reservation teams excel and improve results both in customer satisfaction and revenue growth.
KPIs are important for setting team and individual goals. Knowing how they are performing, you can then recognize or even create commission/ bonus plans to keep them highly motivated.
In this article, you will learn about the 6 main KPIs for hotel sales & reservation performance:
1. Sales conversion rate per agent
2. Total volume of service per agent
3. First response time per agent
4. Sales Cycle
5. Operational inefficient rate
6. Average ticket
But before we continue, let’s define high performance in sales and reservations and how the availability of your team can impact your results.
What makes a high-performing sales and reservation team?
In a highly competitive industry, there’s no time to waste. That means your team must convert every opportunity that comes their way. Each reservation or new account matters.
A high-performing team is one that keeps an eye on every stage of the sales funnel, in both B2C and B2B businesses. Managers along with their teams must be data-driven and strive for daily improvements.
But how do you determine whether your team is performing well? Who is your best agent? The KPIs will provide you with the right answer. If you overlook tracking, your analysis might be flawed.
Here is one example of how the right KPI is key in team evaluations.
Let’s say that one of your agents sold $50,000 in the previous month, and another one sold $40,000. Who performed better?
The answer: it depends on their conversion rates. The first agent might have made 1,000 calls that month and sold 5 reservations of $10,000 each. While the second agent only had 100 calls that same month and converted 20% of the calls, making a total sale of $40,000.
In this scenario, you may notice that although the first agent sold more, he/she had to spend more time and work more on the leads than the second one. So the second one is better?
Again, depends! We need more data to accurately evaluate their performance, including for example the type of leads they are working with.
In a nutshell, there are many factors to take into account when determining the performance of your sales and reservation teams. But what definitely makes a high-performing team is focusing on KPIs to measure, control, and improve results.