How hoteliers analyze calendar shifts, unplanned events
How hoteliers analyze calendar shifts, unplanned events
04 SEPTEMBER 2018 8:16 AM

To better learn from, and then adapt to, calendar shifts and the unexpected, hoteliers must be nimble, and keep it simple.

NASHVILLE, Tennessee—Calendar shifts and unexpected events are often the bane of hotel revenue managers.

During a session titled “Calendar shifts and unplanned events: How to plan for and explain unexpected happenings in performance” at the recent Hotel Data Conference, Matthew Guglielmetti, senior director of topline revenue and competitive analysis at Marriott International, and Chad Church, VP of operations at STR, offered some best practices for how to overcome such challenges. (STR is the parent company of HNN.)

Guglielmetti said the Easter holiday is a good example of a recurring calendar shift, which makes it easier to map out. The holiday in 2018 not only moved weeks, it switched quarters, he said. When preparing for a moving holiday such as Easter, hoteliers should try to normalize it over a rolling 28-day range, he suggested. Hoteliers can also look at it in a two- to three-month average if that’s more appropriate, he said.

“You try to normalize what that week is doing, and you can do a shift with that,” he said. “My suggestion when you do this, look at brand tiers and regions separately. Although folks try to combine everything, we try to look specifically at the resort/luxury portfolio and then at select-serve in suburban markets.”

Don’t overcomplicate it; revenue managers should remember who their audience is, Guglielmetti said. The analysis can get granular and exact, but it must be easily communicated, he said.

“When you’re talking to a C-suite executive, they don’t love data like we do,” he said. “You need a simple method to keep it understandable for folks.”

Unexpected events
When Hurricane Harvey made landfall on 25 August, it was unexpected because as recently as a few days before, news forecasts said the storm would hit the Yucatan Peninsula and fizzle out into a tropical depression, Church said.

“Things changed … and it spun back up,” which made it difficult for hoteliers to prepare for the impact, he said.

As a result, Houston—a heavy oil market that has been depressed for a while—saw a spike in demand from displaced families and relief crews, Church said. Now, a year later, the data comps are arriving.

With an event like Hurricane Harvey, questions need to be answered before hoteliers can start measuring the impact, Church said.

To start, it’s a matter of determining who is going to be the audience for this information, and then conducting the analysis through that lens, Guglielmetti said. Data analysts also need to understand how frequently they’ll be asked to update that information—which could be once a month, once a week or more. It’s usually better to under-promise and over-deliver, he said.

The next step is determining whether the approach will be conservative or aggressive, and the organization’s culture will help drive that, he said.

One method for measuring impact is to identify the base period for the market prior to the event, Guglielmetti said. For an event on 1 April, an analysis might look at January through March as the base period and examine revenue as far back as three years, he said. Then it would compare data from the impact period and the surrounding three months to determine the index between them.

Going back three years will help with understanding the typical performance differences; and the process should account for some seasonality, he said.

Another method involves comparing projections before and after the event, he said.

With this method, you have to really trust your projections, he said.

Hoteliers can look at their pre-event projections and then estimate the impact based on actual results. It means assuming the event never happened and the projection is 100% accurate, he said, and any variation from the projection is because of the event.

Once analysts choose an approach, they should stick with it through the entire process, Guglielmetti said. When it comes time for the hindsight analysis, feel free to pick another method, he said.

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