The future of Performance Metrics

The performance of revenue management has been measured traditionally with measures such as Occupancy, ADR and RevPar, although the hospitality industry has moved in the meantime towards extended measures such as GOPPAR and TrevPar. Indeed, new metrics are requested, mainly from practitioners, to reflect better and more accurately on new developments on revenue management, such as the application of Total Revenue Management in other departments than rooms only. Also a possible shift towards Customer-centric Revenue Management may request a new metric; RevPac is under discussion though not yet conceptualized.

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The present metric for revenue management utilized by the hospitality industry has been in existence since almost thirty years ago. As the world shrinks with globalization, there is an urgent need to revise the metric which the industry employs.

In addition, as economies are disrupted by those of a sharing nature, the traditional way of conducting business and measuring success needs to be reexamined. A revised assessment allows businesses to have a more holistic and better view on revenue management performance. In response to enhanced globalization and the disruptive economies, this analysis will offer insights into what a revised metric entails and propose recommendations on operations, sales, marketing and strategies for the hospitality sector. This study will also serve to address the gap in the academic field of revenue management metric and invite discussions on how to advance the revenue management knowledge.

Therefore, a researcher team lead by the Associate Professor Detlev Remy from SIT, Singapore Institute of Technology, has started an applied research project in collaboration with HSMAI Asia to investigate the applications, scope, meaning and importance of the new revenue management metrics.

Project Stages

Research Partner

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  • Research current practices

    Audience: • Hospitality staff in Revenue Management, Commercial and any others who utilise performance measures in hospitality • Vendors and suppliers of tools and data to the Hospitality industry Purpose: • To establish the use, limitations of current measures • Identify new performance measures

  • Vendor Research

    Method: Research will be conducted via focus groups with vendors presenting their views and perspectives

  • Best Practices Report

    A Best Practices report will be produced and distributed on the research findings including the method of calculations of the measures

  • Test and Share best practice

    Test & Measure: Conceptualise and test the new proposed measure. Output: A paper outlining the specification best practice for measurement for all vendors and hoteliers .

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