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Benchmarking the Competition


Restaurants and hotels have long kept one eye on the competition and one eye on their operations. What is the McDonald's down the street charging for its french fries, or what is the room rate the Day's Inn next door is offering for Wednesday nights? The recent explosion of Atkins friendly and salad offerings in quick service and causal restaurants is only the most recent illustration of the industry's extremely competitive nature.

Now, a new breed of technology companies are offering high-tech services to help both hotels and restaurants keep tabs on their competition. These companies provide business intelligence and help integrate the data into key hospitality systemsÃ.‚¬"point of sale, reservations and revenue management among othersÃ.‚¬"so operators can react quickly and intelligently.

Managing revenue

For hotels, revenue management has always been as much of an art as a science. Determining the appropriate room rate and occupancy levels to match the hotels level of service and to keep it in line with the local competition has required dedicated staff with strong expertise. While trolling websites, ranging from branded sites to Expedia and Travelocity, allows hotels to find out rate information easily, it can consume a great deal of time.

Recently, The Rubicon Group ( began offering a tool for hotels to automate that process. Hilton, for example, now has rate information from branded sites, Travelocity, Orbitz, and Expedia for its competition fed directly into its OnQ system. Revenue managers do not need to learn a new system, since it is seamlessly integrated into OnQ and can make quick adjustments to a changing market to ensure that their hotel's rate is always competitive.

For TravelCLICK's ( RateVIEW the emphasis has been on ensuring high-quality data and providing automated analysis. For hotels with lowest price guarantees, RateVIEW checks competing sites and alerts users when the price on third-party sites drops below the branded site price. TravelCLICK also monitors trends and creates alerts when it spots emerging trends in occupancy and room rates. Current RateVIEW users must extract the data from the TravelCLICK website, but the latest version of RateVIEW, due for release in April, will provide XML or CSV portability to revenue management systems.

Finding your niche

Quick and easy access to competitive data is not as readily available for restaurants. Recently, Smith Travel Research's Smith Analytics ( began running a pilot program in a few markets to provide benchmarking data for quick service, family and causal-dining restaurants. Want to know the average check size by week for causal dining restaurants? Or perhaps you want to compare the average unit volume for quick-service restaurant to the previous year. With commitments from enough major restaurants chainsÃ.‚¬"including Au Bon Pain, Carvel, Applebee's, Bennigan's, Friendly's, IHOP, and Papa John'sÃ.‚¬"Smith Analytics already has a fairly representative sample size.

After nearly a year of pilot testing the benchmarking solution, Smith Analytics is ready to roll it out nationwide. With a wider roll out, Smith Analytics is hoping to attract even more national restaurant chains and independents to the program. That the program came from an offshoot of Smith Travel Research ( should come as no surprise. STR has been providing benchmarking and in-depth industry analysis to the hotel world for years.

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