I’m thrilled to sit down with Katarina Railko, a renowned hospitality expert whose extensive experience in the travel and tourism industry has made her a trusted voice in hotel revenue management. With a keen eye for trends and a passion for events and expos, Katarina has helped countless hoteliers navigate the complexities of benchmarking and turn data into actionable strategies. In this interview, we dive into the evolving role of benchmarking in hotels, exploring how daily data insights can transform decision-making, the importance of pace and competitive positioning, strategies for capturing corporate business, and the nuances of optimizing length of stay patterns. Join us as we unpack these critical topics and learn how modern benchmarking tools are reshaping the hospitality landscape.
How has the role of benchmarking in the hotel industry evolved over the past few years, and why is it more important now than ever?
Benchmarking has really transformed from a periodic check-in to a daily necessity for hoteliers. A few years back, it was often just a monthly or quarterly report you’d glance at to see how you stacked up against competitors. Now, with the pace of the industry and the availability of real-time data, it’s become a core part of daily operations. The market moves so fast—guest expectations shift, competitors adjust rates overnight, and demand fluctuates with events or seasons. If you’re not benchmarking regularly, you’re essentially flying blind. It’s more important now because it gives you the context to make quick, informed decisions rather than guessing or reacting after the fact.
What are some of the pitfalls hoteliers face when their benchmarking data isn’t current or doesn’t reflect their true competition?
When data isn’t fresh, you’re making decisions based on a snapshot that’s already outdated. For example, if your competitor dropped rates yesterday to fill rooms and you’re still looking at last week’s numbers, you might overprice and lose bookings. Similarly, if your competitive set—or compset—doesn’t match the hotels you’re actually up against, your entire strategy can be skewed. You might think you’re performing well compared to a mismatched group, but in reality, your direct competitors are outpacing you in key areas like corporate bookings or weekend demand. It’s like playing a game with the wrong rulebook—you’re setting yourself up to lose without even realizing it.
Can you walk us through the concept of pace and why it’s such a vital indicator of a hotel’s future performance?
Pace is essentially a measure of how your bookings are stacking up for future dates compared to your historical performance and your competitors. It’s a forward-looking indicator that tells you whether you’re on track to meet or exceed your goals. For instance, if you’re at 50% occupancy for a date next month but your compset is at 60%, that’s a signal you’re falling behind. Pace isn’t just about room count—it’s also about the quality of bookings, like the average daily rate. It helps you predict revenue trends and spot potential issues early, giving you time to adjust pricing or marketing strategies before it’s too late.
How can a hotel use pace data to identify gaps in their performance compared to competitors?
Pace data, especially when visualized in a graph, gives you a side-by-side comparison with your compset for specific stay dates. Let’s say for a holiday weekend, you see your occupancy pace is slightly up from last year, but your competitors are trending higher in both occupancy and rate. That gap tells you they’re capturing better business—maybe they’re attracting higher-paying guests or filling up faster. By drilling down into pace data, you can pinpoint exactly where you’re losing ground, whether it’s a specific segment or time period, and then strategize to close that gap with targeted promotions or rate adjustments.
Why is corporate negotiated business often a cornerstone for many hotels, and how can benchmarking help in this area?
Corporate negotiated business is huge because it provides a steady stream of bookings, often at predictable times, which helps stabilize revenue. These are typically high-value accounts with consistent demand, especially for urban or business-district hotels. Benchmarking lets you see how much of this segment you’re capturing compared to your compset. If you’re getting a larger share—say, 25% of your occupancy from corporate accounts while your competitors are at 8%—that’s a strength to leverage during contract renewals. But if you’re lagging, benchmarking highlights that weakness, prompting you to refine your sales approach or offer better terms to win more of that business.
How does understanding length of stay patterns through benchmarking give hotels a competitive edge?
Length of stay, or LOS, goes beyond just filling rooms—it shows you how valuable those bookings are. A hotel full of one-night stays might look busy, but longer stays often mean higher total revenue per guest and lower operational costs per night. By looking at compset data, you can see which stay lengths are most common or profitable in your market. If your competitors are capturing more three-night stays while you’re stuck with one-nighters, you might test packages or incentives to encourage longer visits. It’s about optimizing your mix to match or beat what’s working for others in your space.
What strategies can revenue managers employ when benchmarking reveals they’re underperforming on specific dates or segments?
When you spot underperformance—say, your revenue per available room dips below your compset on certain dates—the first step is to dig into the ‘why.’ Is it a pricing issue, a lack of demand in a key segment, or a broader market trend? From there, you can tailor your response. For specific dates, targeted offers or last-minute rate adjustments can help fill rooms. If it’s a segment like corporate bookings, you might need to revisit your sales pitch or offer better perks during negotiations. The key is to act fast while there’s still time to influence results, using benchmarking as your guide to prioritize where to focus your efforts.
What’s your forecast for the future of benchmarking in the hospitality industry as data and technology continue to advance?
I think benchmarking is only going to get more precise and actionable as technology evolves. We’re already seeing daily data refreshes and granular insights become the norm, but I expect we’ll move toward even more predictive analytics. Imagine tools that not only show how you’re performing against competitors today but can forecast demand shifts or competitor moves based on historical patterns and real-time signals. I also see benchmarking becoming more integrated with other systems like pricing engines and marketing platforms, so hoteliers can automate responses to data insights. It’s an exciting time—the future is about turning data into not just a report, but a real-time decision-making partner.
