The hospitality and restaurant industries in New Jersey are on the rise, with approximately $29.1 billion in annual revenue and nearly 100,000 employees. But the competition is equally fierce, which is to be expected in a state with over 1,600 hotels.
With savvier guests and easier access to advanced analysis tools, businesses of every size can now pose a threat to long-standing market leaders. This is not necessarily bad news, as it’s a sign of a strong market that offers plenty of opportunities to those who prepare.
But it also shows the importance of monitoring your competition. Luckily, with hotel price intelligence tools, it’s easier than ever to know what’s going on in your competitors’ backyard. If you’re new to this concept, stick around—we’re about to do a deep dive into what hotel price intelligence is and who stands to benefit the most from using it.
Hotel Price Intelligence Tools Explained
Simply put, price intelligence is the process of using real-time data to understand market demand and competitor moves. For a hotel or hospitality establishment, this information is essential as it allows them to build a solid pricing strategy that follows the general trend.
But building such a strategy requires more than knowing your competitors’ room prices. There are several components to it, such as:
Competitive Set Monitoring
You won’t get a good birds’ eye view of the local market if you’re only monitoring the hotels next door. For this, you need a rate shopping tool that collects prices from all local competitors automatically.
Modern tools allow you to track subsets, like the big brands and the local boutiques that may be your rivals in various market sectors. Since these are automated tools, you’ll always have fresh data to work with.
Data Quality
Speaking of data, it’s essential to understand how to differentiate between data points and sets. Your intelligence source must offer real-time updates and apples-to-apples comparisons.
If you’re comparing a “King Suite with Breakfast” to a “Standard Double Room-Only,” your data is lying to you. This can lead to costly mistakes down the road, especially in an industry where the competition is this tight.
Automated Alerts
If a competitor drops their prices or offers a discount, you want to know right away. Luckily, this is possible with advanced monitoring systems that send push notifications or emails.
For instance, hotels tend to offer romantic options for any budget on Valentine’s Day or for couples on their honeymoon. If this means your guests are choosing a different brand, you need to know!
Who Needs Price Intelligence Technology the Most?
Every hotel using this type of tech stands to gain, but some get more benefits than others. For instance, small businesses like boutique hotels use price intelligence to maintain their premium positioning.
By monitoring the market, boutiques can justify their higher ADR (Average Daily Rate) by ensuring they aren’t too far out of step with the local luxury tier.
Destination resorts are also benefiting from this. Intelligence here is used to predict demand months in advance for holiday blocks. For these properties, data helps manage length-of-stay restrictions, ensuring a two-night booking doesn’t break a potential seven-night windfall.
For hotels with a strong culinary offer, price intelligence can help craft “Stay & Dine” bundles that are unbeatable. If data shows room rates are peaking across town due to a concert, you can keep your room rate steady but bundle it with a high-margin dinner at your signature restaurant. You secure the booking through perceived value, while the competitor only sells a room.
Wrap Up
Overall, hotel price intelligence technology offers real-time insight into the market, which you can use to adjust pricing strategy on the fly (if needed). “Knowledge is power” has never been truer than today.
But this is not about winning a price war with local hoteliers. It’s about having the most accurate map of the battlefield. For the local hotelier, that’s the difference between a busy lobby and a profitable one.
The New Jersey Digest is a new jersey magazine that has chronicled daily life in the Garden State for over 10 years.