CHIA Competitive Intelligence & Benchmarking 2 — Questions and Answers
Question 1: A hotel's STAR report shows an RGI of 95. What does this indicate?
- The hotel is capturing 5% more RevPAR than its competitive set
- The hotel is capturing 5% less RevPAR than its competitive set (Correct answer)
- The hotel's RevPAR is $95 below the competitive set average
- The hotel has underperformed the market by 95%
Correct answer: The hotel is capturing 5% less RevPAR than its competitive set
An RGI below 100 means the hotel is not capturing its fair share of revenue; an RGI of 95 indicates it is performing 5% below the competitive set average.
Question 2: Which criterion is most important when selecting hotels for a competitive set?
- Hotels in the same brand family
- Hotels with the same star rating as the subject property
- Hotels that guests and meeting planners consider as alternatives (Correct answer)
- Hotels within a one-mile radius of the subject property
Correct answer: Hotels that guests and meeting planners consider as alternatives
A competitive set should reflect hotels that potential guests actually consider when choosing where to stay, making customer perception the primary selection criterion.
Question 3: What is the purpose of analyzing 'running 12-month' data in a STAR report?
- To identify daily demand fluctuations
- To smooth out seasonal variability and show annual trend performance (Correct answer)
- To compare performance across different market segments
- To calculate the hotel's RevPAR contribution index
Correct answer: To smooth out seasonal variability and show annual trend performance
Running 12-month (or year-to-date rolling) data eliminates seasonal distortions, providing a clearer picture of year-over-year performance trends.
Question 4: In competitive benchmarking, 'supply penetration' refers to a hotel's:
- Number of rooms as a percentage of total comp set rooms (Correct answer)
- RevPAR as a percentage of the highest competitor's RevPAR
- Market share relative to all hotels in the broader market
- Occupancy rate divided by the competitive set occupancy rate
Correct answer: Number of rooms as a percentage of total comp set rooms
Supply penetration is the hotel's room count divided by the total room supply of its competitive set, establishing its baseline fair share expectation.
Question 5: A hotel with an ARI greater than 100 and an MPI less than 100 is most likely pursuing which strategy?
- Volume-driven pricing to maximize occupancy
- Premium pricing that sacrifices some occupancy for higher rates (Correct answer)
- Discount pricing to undercut competitors
- Yield management that balances rate and occupancy equally
Correct answer: Premium pricing that sacrifices some occupancy for higher rates
Higher ARI with lower MPI means the hotel charges above-average rates but attracts fewer guests, indicating a rate-premium strategy that trades occupancy for ADR.
Question 6: What is 'demand penetration' in hotel competitive analysis?
- A hotel's occupied rooms as a share of total comp set occupied rooms (Correct answer)
- The ratio of transient demand to group demand in a market
- The percentage of demand generated by online channels
- Total rooms sold by a market divided by total rooms available
Correct answer: A hotel's occupied rooms as a share of total comp set occupied rooms
Demand penetration measures a hotel's share of actual rooms sold (occupied rooms) compared to total rooms sold across the competitive set.
Question 7: Which STR report time period is most useful for evaluating a hotel's performance during a specific short-term promotional campaign?
- Running 12-month
- Year-to-date
- Month-to-date or weekly data (Correct answer)
- Quarter-over-quarter comparison
Correct answer: Month-to-date or weekly data
Month-to-date or weekly data provides the granularity needed to assess the immediate impact of a short-term promotional campaign on performance metrics.
CHIA Competitive Intelligence & Benchmarking 2
A hotel's STAR report shows an RGI of 95.
What does this indicate?