Here are five ways to refine your comp set, according to a speaker at the recent Hotel Data Conference.
Comp sets can be an invaluable tool for hoteliers when it comes to sizing up the competition. But they also require constant monitoring and management.
Ali Hoyt, senior project manager for STR Analytics provided tips to refine your comp set during the recent Hotel Data Conference.
1. Understand comp set composition
To start, Hoyt said it’s important to understand the composition of a comp set. According to STR guidelines, a comp set in the United States has as few as three properties (the minimum required) and as many as 29 properties.
No single property or brand can account for more than 40% of total participating room supply, and no single company can account for more than 60% of the total participating room supply, Hoyt said.
The average comp set size is between five and six properties. The average number of times a hotel is named as a competitor is 5.2, and the average number of properties in a primary comp set is 5.4, she said.
2. Consider multiple sets
When is there a good time to add a secondary or tertiary set?
Hoyt said there are several different purposes for additional comp sets:
- Regional: When a hotel isn’t necessarily fighting for the same customer but goes farther out to see how others are performing in the region;
- Local: Honing in on one particular location;
- Aspirational: A comp set that shows a level the property aspires to (such as looking at a set after a planned renovation);
- Niche: This set ignores geography and focuses on a similar product (i.e. Colorado ski resorts);
- Seasonal: This comp set would be for seasonal properties (i.e. Upstate New York);
- Group and transient mix: For hotels that cater to groups, it might be important to have a comp set that is solely focused on group business to see where the competition is for that business mix.
In general, Hoyt said, upper-tier hotels have multiple comp sets. Of luxury and upper-upscale hotels in the U.S., 36% have two comp sets, and 16% have three or more comp sets. For the total U.S., 91% have only one comp set.
3. Understand how to benchmark your comp set
Hoyt said this is actually a new idea. “You’re using your STAR report to benchmark your performance, but how can you actually benchmark your comp set against other comp sets to make sure you’re in the right comp set?” she said.
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