Competitive set and revenue management: how to make the most of analysis for our business
When we deal with the subject of the study of the market, one of the most frequently asked questions we face is: is every accommodation in my territory my competitor?
Competitors are those companies that have the same target, so in the case of the tourism industry, not every accommodation facility has the same audience that we can have.
For this reason, it is particularly important to get a clear idea of what are the realities to be considered competitors in our own territory.
But even so, the number of companies can still be very high and mapping each of them can be difficult.
What can be done then?
The competitive set and the importance of the choice of competitors
In the case of the tourism industry, with a competitive set we refer to a group of hotels or extra-hotel facilities that we can, in actual fact, consider real competitors.
For ease of analysis, the choice of this group is usually limited to a low number of structures, between 10 and 20.
This is because, as already mentioned, considering every hotel or extrahotel reality our competitor risks creating only a lot of confusion in our analysis.
Given the importance of setting the comp set, the choice must be based on a number of factors, which in turn are based on the similarities between us and other companies: price, geographical location, size, services available, etc.
By setting up our analysis with these factors in mind, we can build our strategy in a more targeted way, having a clearer path to achieving our KPIs.
How to create a competitive set that works?
There are various methods we can choose to set up a comp set.
If we want to be autonomous and create it with free tools, one way we can pursue is to make the most of OTAs and their tools. Portals like Booking, Airbnb or Airdna already give some metrics you can use to understand what are the most similar hotels to ours, thanks to the search by place, price range, services available, etc.
Taking these metrics, we can first insert them in a file, excel maybe, in which to set a time analysis on which to study the variability of the market.
In this way, we can always keep an eye on the trend of the realities around us and understand how to manage revenue in the best way to be as competitive and performing as possible.
Now the word to you: have you ever set up a comp set? What do you think, has it helped you in carrying on your business?
You think that’s useful?
Let us know with a comment or writing on all socials!
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And as always… good revenue!