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Market Penetration Index

Is your hotel getting it's fair market share? Use KPI like MPI, ARI, RGI to benchmark the results of your hotel's revenue management performance. What is your market penetration index?

Compare regional arrivals statistics with yours. Stats can be obtained from airport, tourism boards. Are you getting your part or fair share of the pie?

hotel-benchmark-2-rmb

Market share reports help you to understand your performance versus your competitors, both in terms of occupancy and average rate. They can provide the following information:

  • MPI - Market Penetration Index (your occupancy results versus the average occupancy of your competitors)
  • ARI - Average Rate Index (your ARR versus the average ARR of your competitors)
  • RGI - Revenue Generator Index (your revenue share of the market, the market being your hotel and the hotel competitors).

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Smart Revenue Management Software

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Your RGI should be above 100 (Index base 100). If not, that would mean that some of your competitors convert more business than you do. Reading the day by day RGI, when do you achieve the lowest score? Week-days, week-ends, events, low demand periods? Do you have the right market segmentation? Is your price positioning by segment correct? It is also important to compare yourself to the right competitors!

Such reports are built in the following format, with day by day results :

hotel market penetration index-ahotel average rate index-a

The Bench, MKG and Deloite are among the main suppliers of such reports.

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