Hotel competitors analysis is crucial as a hotel’s success depends on factors such as timing, pricing, and targeting the right audience. To make informed decisions, begin your competitor analysis by identifying those who offer similar products and services as your hotel.
Alternatively, setting clear goals to track progress can simplify the process. This approach helps in defining your targets, determining the necessary information, identifying your main competitors, collecting and analyzing data, and conducting a thorough analysis.
We’ll go into more detail about hotel competitor analysis, its significance, and how to conduct it in this blog so that you can create a successful plan that will help you stand out from the competition. Let’s get started!
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Understanding Hotel Competitive Analysis
A hotel competitor’s analysis helps you figure out where your hotel stands in the market by looking at its pros and cons. Hotel owners use this to set the right prices and gain a competitive advantage in the local market.
You can compare the services and prices of other hotels in your area to what your hotels offer. This helps you make better plans for the future. You can look at their services, prices, and other things to see how well your hotel stacks up against them.
This is where competitor analysis comes in handy. When people are deciding where to book, they are comparing your property to about five or six hotels. While there are other factors to consider, it is a good idea to look at nearby hotels as a starting point.
Why Performing a Hotel Competitive Analysis is Important?
By doing a competitive analysis of other hotels, you can make sure your hotel’s prices are good for your market. This is often called a value analysis, and it gives you useful information to help with pricing.
It prevents you from losing money by charging too much or from missing out on profit by charging too little. In addition to helping you provide better services, this practice will assist you in creating a strategy and plan that can adapt and grow with your business as it expands in the future.
If you’ve ever worked on marketing strategies or strategic planning for business expansion, you might have done a SWOT analysis. This analysis looks at your company’s strengths and weaknesses, as well as the opportunities and challenges it faces.
Just like hotel competitor analysis, it will assist you in finding the ideal position for your business in the local hospitality industry. When it comes to your competitors, having information is a powerful advantage. Without this knowledge, you will lose the chance to figure out the best way to attract your target audience
Step-by-Step Guide to Conducting a Hotel Competitive Analysis
Let’s start by going through a step-by-step guide on how to conduct a hotel competitive analysis.
To boost your income, you need to make smart decisions and understand your numbers, but that can be a real pain and take up a lot of time. Nowadays, it is not just big hotels with full-time management teams that can do revenue management.
If a property type or lodging provider wants to see improved revenue per available room (RevPAR), a higher average daily rate, and more profitability, they should be undertaking a hotel competitor analysis.
Let’s now examine the many procedures required to do a hotel competitor analysis:
Step 1: Selecting Your Hotel Competitive Set
Select your hotel ‘compset’, commonly referred to as your hotel competitive set. Choose three to five direct rivals in your market (we’ll pick four in our example). Pick hotels that attract the same kind of people and potential guests as yours to make sure you’re making a fair comparison.
Step 2: Listing Competitive Characteristics
Once you have made a list of the competitive features for comparison, focus on the four attributes highlighted in the table and listed below as the value analysis. Give 1-10 as the scale number.
- The location
- Property Amenities
- Room Quality
Step 3: Calculating Perceived Value
Figure out how valuable the hotel is by calculating the average of those values above.
The Location = 8
Property Amenities = 7
Room Quality = 8
Review = 6
Average Number = 7.25
Step 4: Inventory of Room Rates
Next, provide the typical accommodation costs for your compset: Make a note of the best and lowest rates you could find for each property that is publicly listed.
Step 5: Plotting Results on a Graph
Make a visual representation of the results on a graph (see illustration). Put the RATE on the “x-axis” by arranging the rates for each property from the lowest to the highest. Add the VALUE or the average score you determined for each property in Step 3, to the “y-axis.”
Step 6: Building Your Compset Strategy
Analyze the results to create your compset approach. The graph helps you see where you stand in the market compared to your competitors in terms of value and cost.
TOP 5 AI Tools Technology You Can Use for Competitive Analysis
Similarweb – Ideal for a comprehensive competitor analysis
Similarweb is an all-in-one tool that makes it much simpler and quicker to study your competitors. It does this by using the latest global data to give you accurate insights into your industry’s current situation. The pros and cons of Similarweb include
- Superior precision using the most recent data available worldwide
- Start a free trial now to get started.
- Get data and insights together by being notified of rival performance shifts and trends through the platform or via email.
- Easy-to-understand insights for both beginners and experts.
- It might take a while to figure out how to make the most of the large amount of data that’s out there
- The free version has several restrictions.
Functions and value
Similarweb is the only tool that allows you to see what’s currently happening in the digital world of your competitors or your own business. It does this by providing detailed information about visitor behavior, website traffic, and strategies for paid ads, partnerships, social media, and SEO content.
- Check out your competitors’ online presence to discover new growth opportunities. You will find out which marketing strategies in your industry are attracting the most visitors.
- Reduce the amount of time you spend sifting through data and instead focus on actionable insights by selecting from a variety of filters, such as organic and paid, branded and non-branded, and keyword subjects.
- Learn new, useful information about your traffic and keywords in comparison to those of your rivals.
- Find out who your rivals are targeting. Use information about your audience’s age, location, and interests to figure out the most suitable times and places for meetings.
- Get a better understanding of how your keywords and website traffic stack up against your competitors by getting a report on their keywords. You will receive a detailed table with important information about the volume, position, CPC, search intent, difficulty, traffic, and SERP properties of each phrase. Take a look at how much traffic your term gets compared to the competition, and identify where your content may be lacking.
SpyFu – Ideal for comparing and evaluating
The self-assuredly named SpyFu, helps you analyze SEO and PPC data to closely observe what your competitors are doing. Enter a domain name into the tool to view all of the places it has appeared on Google, Bing, and Yahoo.
The pros and cons of SpyFu include:
- Excellent assortment of features for thorough competitor analysis
- Install keyword monitoring quickly
- Beautiful data visualization
- Novice SEO users may find the user interface (UI) somewhat busy or unclear.
- There is a problem with exporting graphs and charts because you can only download data.
- No coverage throughout the entire web; the database provides keywords for specific domains.
Functions and value
Together with comprehensive keyword analytics, SpyFu provides you with a very clear image of each competitor’s organic and sponsored status.
- You may enhance your own organic and paid strategies by using the comprehensive image of each channel provided by advanced SEO and PPC reports.
- You may examine every term your rival has purchased on Google AdWords, where they rank in search results naturally, and different versions of their ads from the past 16 years. This is done through backlink research, keywords analysis, and studying their content
- One of my favorite features is the Kombat function, which shows you how you’re working differently from competitors.
BuzzSumo – Ideal for analyzing social media posts from competitors
BuzzSumo is a content analysis tool that helps you identify the material produced by competitors in your market that is most successful. Find the most effective outreach, content, and engagement gaps on social media and search. The pros and cons of BuzzSumo include:
- A direct and practical method
- Connecting with Majestic
- Poor backlink analysis
- It’s unclear whether posts with a lot of shares are enhanced, which could affect a thorough competitor analysis
Functions and value
BuzzSumo facilitates the process of identifying online material that is most popular with your target audience, both from your competitors and from you. These insights might help you improve your search engine optimization and social media storytelling.
- You may find relevant influencers and keyword mentions with Content Alerts. With insights on high-performing pieces, specialty keywords, trending stories, and customer inquiries, you can see statistics on content that is becoming viral in your business. Gain a better understanding of your content opportunities to boost social engagement.
- Finding rivals’ effective influencer strategies is made simple by the segmentation of influencers.
Majestic – Best for identifying backlinks from competitors
Majestic is one of the top tools for analyzing competitor link data. Majestic gathers information from internet searches to build the biggest link database on the planet. This database provides a thorough analysis of both your own and your competitors’ backlink profiles. The pros and cons of Majestic include:
- An enormous collection of more than 8 trillion URLs
- The easy-to-use interface facilitates the interpretation of charts and insights
- Adding browser extensions and connecting with Buzzsumo
- No insights on PPC
- Getting the hang of custom metrics can be tough
Functions and value
Majestic allows you to identify which links drive the most traffic to each of your rivals’ websites. By keeping an eye on rivals’ backlink tactics, you may improve your own with less trial and error.
- Get information on anchor text, new and lost links, and referring domains to strengthen your domain authority versus competitors.
- Get a complete list of websites that are like yours. You can check which competitor sites often appear alongside links related to your search term. Then, adjust your keyword strategy to bring more visitors to your website
Owletter – Ideal for tracking rival email campaigns
If you’ve ever signed up for approximately 1200 email lists from your competitors and quickly regretted it, Owletter is the tool for you (even if you were trying to do competitive research with good intentions). The pros and cons of Owletter include:
- Clears your inbox by saving each competitor’s email in a tidy collection
- Detailed insights into your and your competitors’ spam reputations
- Limited features because it’s a purpose-specific tool
Functions and value
Owletter genuinely makes email marketing monitoring easier. Owletter gives you great opportunities with plenty of advantages, because it provides advanced but easy-to-understand email content analysis, unlimited notifications based on the keywords you choose, and email summaries.
- Owletter keeps track of, gathers, and archives newsletters delivered from any server into a convenient, well-organized archive. After that, it gives you a covert analysis of these mailings that you can utilize to improve your email marketing plan and reach a wider audience.
- Enhanced keyword filters, along with seasonality and trend statistics, enable you to stay informed about the most important email themes. Make the most of the narrative in your email campaigns by keeping an eye on the subjects your rivals focus on in their content.
Real-Life Case Study: How Big Brands Use Data for Competitor Analysis
Marriott Hotels uses data research about hotels to make customers more loyal and increase their revenue. The business uses dynamic pricing to modify charges in response to different variables. And you know what? The revenue per room increases by 5% as a result of this method.
Their use of analytics and hotel data goes beyond just price. Algorithms keep an eye on events like Madison Square Garden concerts and change hotel prices nearby.
Additionally, the business uses facial recognition to test registration. This method saves guests from having to wait around for too long. Additionally, the Amazon Echos in the rooms offer useful insights into guest preferences and wants to be based on customer data from the hotel.
One great example of using big data in the restaurant business is Uber Eats. By precisely anticipating delivery times, the business hoped to establish itself as a well-liked hot meal delivery service.
Uber Eats tells customers when to expect their food delivery and sends a driver at the right time after they order. this is where hotel analytics takes things to a whole new level. The company hires meteorologists to make predictions more accurate. To improve forecasts, they track driver movements and how the weather will affect things.
With 81 million customers, Uber Eats is the most popular meal delivery service globally, largely due to data analysis in the hospitality sector. Despite the fierce competition, the company’s revenue is growing quickly at the same time.
With almost 25,000 outlets across the globe, Starbucks processes 90 million transactions per week. They gather useful hospitality data analytics through their mobile app and rewards program, including ordering patterns and preferred drinks. By doing this, Starbucks gives customers a customized experience and lets them discover new favorites.
Additionally, the company modifies its recommendations according to geography, weather, and holidays. For instance, they used a Tennessee heat wave to introduce a regional Frappuccino promotion. It encouraged customers to refresh themselves with a cold drink.
How effective are these advanced analytics in the hotel industry? In the US, 29% of patrons of restaurant chains intend to visit Starbucks again. Considering their 33% usage share, that means 88% of their customers are brand loyal.
To keep ahead of the competition, McDonald’s welcomes data. To provide a great client experience, the hospitality industry uses improved data analytics to anticipate large orders and staff appropriately.
Customer data is gathered using the McDonald’s app, which results in customized offers and repeat business. Digital menus promote products for certain needs by adjusting according to the time of day, weather, events, and availability of products. For drive-thru customers, license plate readers and geofencing allow for order customization. In 2021, it led to an outstanding 5.5% increase in same-store sales.
Big data in the hotel sector has also helped the business align supply with demand, prevent product shortages, and manage inventory more effectively.
In summary, Analyzing your hotel’s competition is crucial for creating strategies to grow your business. It helps you understand how the market reacts to demand and how your competitors’ pricing might affect your financial goals.
Furthermore, the accurate competition analysis creates a road plan for making your company stand out from the competitors. It provides an alternative, although crucial, viewpoint for expanding your hotel organization.
Frequently Asked Questions
Hotel revenue managers frequently conduct competition analysis. The analysis is carried out by the room division manager in larger hotels and by the general manager in smaller hotels.
The process of setting the rack rates takes place once, at the start of each fiscal year. After that, it’s a routine exercise that aids with demand monitoring as well.
If you deviate from the seasonal price strategy, you should replace your rivals when one of the following occurs: you add more keys to your hotel; the rival adds more keys to their hotel; you upgrade your hotel; the rival upgrades their hotel; or the competitor’s review ratings decline.
Beyond the comparison pricing, there are other aspects to consider. Considerations include your occupancy, any upcoming events or festivals, and the lead time for bookings.
That was the explanation of hotel competitors analysis starting from the definition, how important it is, step by step, tools, to the case study. If you want to know more about other insights about hospitality digital marketing, visit our blog page here!