Seasonality Tool
Determining Seasonality
What is Seasonality?
Seasonality is defined as a pattern of seasons that repeat themselves predictably over time. Seasons are periods of time during which demand for a property and/or market is similar and/or constant, or is significantly different from demand periods around it.
Why Define Your Seasons?
Identifying a property’s seasons is an important factor in your ability to proactively price your property correctly at all times of the year. Seasonal pricing helps reduce the risk that your property will have inappropriate rates set during different seasons, and it reduces the risk that you are turning down customers who would have booked had the proper price been in place for the dates requested.
Understanding the importance of seasonality will help you target seasonal timeframes when it may make sense to capitalize on revenue opportunities by adjusting transient rates either up or down. In general, as occupancy/demand fluctuates, so too does the opportunity to adjust rates.
How to Define Your Seasons
Seasonality is determined by using a variety of tools to identify and analyze trends in property/market occupancy and demand. To define your property’s seasons, complete the following steps:
- Using your most recent Market Share Report, review the Occupancy, Average Room Rate and RevPAR Charts. Each of these charts plots your property’s performance over the last 18 months versus your comp set.
- For each of the graphs, draw vertical lines through the horizontal axis to indicate logical seasonal breaks.
- Evaluate and compare the lines you have drawn on each of the graphs:
- Do the lines drawn on the Occupancy and Average Room Rate graphs validate the hotel’s current seasons?
- Do the lines on the Occupancy and Average Room Rate graphs mirror each other? If not, why not?
- Do the Occupancy trends between your property and the comp set mirror each other? If not, why not?
- Do the Average Room Rate trends between your property and the comp set mirror each other? If not, why not?
- Do the RevPAR trends between your property and the comp set mirror each other? If not, why not?
- Based on your assessment and answers to the above questions, you may have opportunities to re-define some of your seasons.
- However, keep in mind that hotel occupancy does not reflect total demand.
A few important facts about seasons:
- In most cases, weekday and weekend seasonality must be viewed separately when determining seasons. This is contingent on the dynamics of the marketplace as well as the customer mix.
- Season dates can be as short as just a few days or as long as one year, but they must be contiguous.
- Date ranges may start and end on any day of the week; however, ideally rate changes would begin and end on a Friday (weekend transient) or Sunday (weekday transient). Note that some properties may have seven-day strategies, in which case the season would, for example, begin on a Sunday and end on a Saturday.
- The number of a property’s seasons can vary greatly by region, market and property; however, many properties have four seasons (Low, Shoulder, High, Shoulder).
- Seasons at your property may differ by segment (i.e., transient and group).
Seasonality Tool
This tool is to help identify seasonal trends that affect your hotel,
– How these trends may differ across various market segments.
– This tool reviews historic data at the period or month level,
The graphs, Show
- Demand,
- ADR, and
- Rooms Sold, allow you to look back historically by rate code.
-These graphs provide a view of the trends in market performance,
-The ADR and Rooms Sold graphs go back up to three years,
-Demand graph up to two.
no more than five at a time for clarity’s sake -Select which rate codes to view –
-ِ-Adjust the time frame to focus on recent history or to look at longer term trends.
-The Market Share graph compares your property’s RevPAR to your Comp Set’s.
-The variance between the two of these can be understood as the index premium.
This graph can help you determine if there is a seasonal component to our market share, and if our competitors are defining their seasons differently from us. The report for full week data only.
-The External Factors table is a manual input These can include holidays, weather changes, school schedules in your market or key source markets.
-The Competitors manual entry.
List your competitors in the first column and you major market segments in the first row across the top.
