Question

perty of a national nal director of gets. However, otels in the area, the uch higher occupancy ates. The Chris al should be to Case Study Sales Underperforms Even While Meeting Budget The Christopher Hotel is a 180-room economy/business property of chain located in a booming suburb of a major city. Tony, the regional di operations, is orienting the property's new general manager, Janice. Generally, the hotel is close to meeting most of its budgeted targets, when Tony compares the hotel's activity with competing hotels in the picture changes dramatically. Other hotels are enjoying much higher levels than the Christopher and they are selling rooms at higher rates. The topher's market penetration is only 84 percent, when its baseline goal should achieve at least 100 percent of its fair share of the market. Tony calculates pe tion rate by dividing the hotel's actual market share by its fair share (based on proportion of rooms available in the local market). Tony and Janice also review the Christopher's group business. Year-to-date the hotel sold 4,796 group room nights-short of the budgeted target of 6,500 group room nights. The average room rate (ADR) for group business is down $4 from the budget. Tony tells Janice, "While I'm here I want to investigate these problems with you and help come up with an action plan to address them. How can we increase the Christopher's penetration rate, Janice?" "I'd start by examining what kind of new business-group and otherwise-is ing generated," says Janice. "What is the mix of corporate, leisure, government, or educational groups looking for rooms? I bet that new college is putting together a sports program; visiting teams will need someplace to stay." "You could be right," says Tony. "The school is so new that you might be too early on that idea, but it couldn't hurt to get a start with the sports program devel- oper. Let's see what the hotel has historically done with groups." He pulls out some reports. "They've got corporate groups contributing 3,000 room nights and other groups contributing the rest of their total 4,796." "Other groups'? Is that how it's listed -'other groups'? Aren't there classi cations within that 'other' category?" asks Janice. Tony responds, "That's how it's listed." Janice shakes her head and asks, "Do we have a group rooms control look at so we can see how individual group segments are performing? How a pace report so we can see how group bookings kept up with budgeted amoun Tony shuffles some of the papers and replies, "The previous GM did GRC log and a pace report. He may not have used them to fullest advantage also could have kept better track of what the property's competitors were That information is crucial to success, especially in this local area. In the months, I would like you to keep up to date on what our competitors are and how they're doing it." dvantage. He ocal area. In the next few ompetitors are doing "How good a networker was the previous director of sales?" asks Janice he have relationships with area churches, mosques, and synagogues for w and other special ceremony business? Was he in touch with the manager local convention center? How about city officials?" asks Janice. "Did gues for wedding hanager of the

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1. What factors should Janice consider when planning to increase the hotel’s marketpenetration rate?
Internal sources of marketing information. External sources of marketing information.Hotel’s own property analysis. Competition analysis. New market analysis.

2. What factors should Janice consider in relation to increasing group business?
The property of competitors. Marketplace analysis and find new marketplace ifnecessary. A good network and relation with potential institutes and guests.

3. What initial steps should Janice take to evaluate the low average room rate for groups?
Update and change the room inventory management guidelines. Making sure staff knowthe guidelines. Making sure staff can follow the guideline properly.

4. How can Janice find out what the competition is doing and how they’re doing it?
Pay attention to their ads. Be a customers and visit their hotels regularly. Ask theircustomer and clients. Ask her business colleagues.