boy with head in hands and question marks reflecting how GMs can hide behind benchmarking and should lead rather than follow the competition

Hotels often use benchmarking as a security blanket to justify sticking to the status quo by saying, “At least we’re doing as well as – or better than – our competitors.”

NB: This is an article from Demand Calendar

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However, this comfort zone can quickly become a trap. You’ll never set the pace if your only goal is to match the market. To truly lead, you need to learn from benchmarking insights without becoming just like everyone else. This means using data as a springboard for innovation – drawing inspiration from the past while keeping your focus on the future.

The Purpose of Benchmarking: Learning, Not Copying

At its core, benchmarking illuminates possibilities – it shows where you stand, highlights potential pitfalls, and reveals strategies that could help you improve. It’s a learning tool for avoiding the mistakes that others have already made. By examining how similar hotels allocate labor costs, price their rooms, or package ancillary services, you can prevent inefficiencies and pitfalls while gleaning best practices.

The danger lies in blindly copying every competitive move without considering your unique situation. If you default to a “copycat” strategy, you risk losing your hotel’s unique identity. Use benchmarking to inspire creativity, not to create clones. For instance, if a competitor excels in upselling techniques, adapt those principles to fit your brand voice, staff skills, and market position. In short, benchmarking is a powerful tool. It shows you what’s working (or not) for others, but your hotel’s success depends on how you adapt those insights to forge your own path forward.

Benchmarking’s Limitations: Retrospective by Nature

At first glance, the more comparative data you have, the more precise your path to success. But here’s the hidden catch: benchmarking data is always rooted in the past. By focusing exclusively on what your competitors achieved last quarter – or even last month – you risk chasing a moving target. Competitors constantly adjust rates, invest in new technologies, or pivot their marketing tactics, meaning your “current” benchmark may already be outdated.

This limitation becomes even more pronounced in an industry as dynamic as hospitality. Guest preferences shift, new distribution channels emerge, and technological change only accelerates. A benchmark can reveal where you once stood relative to others but can’t always show you where to go next. To get ahead, you must pair retrospective insights with forward-looking strategies that anticipate market shifts and differentiate your hotel in ways your competitors haven’t yet considered.

Balancing Act: Learning from Competitors vs. Leading the Market

The real skill in benchmarking is using data to boost your efficiency while keeping your originality intact. Observing how other hotels handle staffing, use upselling strategies, or cut down on food waste is helpful. However, if you just copy these methods, you’ll always lag behind the innovators.

Instead, view benchmarking as the foundation for your hotel’s strategic innovation. Ask yourself: How can we adopt the core ideas behind these best practices while elevating them with our own twist? You can make targeted improvements by identifying gaps – like higher-than-average credit card fees or lower ancillary revenue than your competitors. At the same time, use those insights to fuel unique concepts that no one in your competitive set offers. Whether it’s a new virtual concierge platform, a signature in-room experience, or a locally inspired F&B concept, these differentiators ensure that you’re not just catching up but propelling the market forward.

Ultimately, great hotels learn from others to eliminate obvious pitfalls and experiment with fresh ideas to stay a step ahead. By keeping one eye on competitors’ past performance and the other on uncharted terrain, they can achieve a profitable balance between operational excellence and true market leadership.

Read the full article at Demand Calendar