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Client
A medium-sized municipality located in a domestic tourist market near a major resort destination.
Challenge
To assess the probability of proposed resort development that would generate much-needed tourism dollars and make the municipality known as a ‘base’ for tourists.
Solution
The Glenroe Group assessed hotel room night demand; analyzed the feasibility and profitability of proposed new hotel developments, and made recommendations for the municipality to broaden its presence and tourist foothold within the larger regional market.
To accurately gauge the hotel room night demand, we compared and contrasted existing hotel inventory (i.e. segmentation, performance, price point and amenities) with its competitive set, as well as other tourist destinations. We evaluated consumer visitation patterns; including length of stay, choice of hotel product and visitation to key area attractions. This data enabled us to forecast future hotel room night demand for a decade; identifying future room night demand growth by product type and guest mix. Sensitivity analyses were also conducted to account for future shifts in room night demand mix as a result of new hotels entering the market, as well as new demographic and consumer trends taking hold. Based on this work, we identified opportunities for incremental room night capture and options to improve pricing and RevPAR performance. We also examined alternative scenarios that the hotels could be better positioned to capture incremental revenue.
Glenroe is currently beginning Phase 2 with the client to further develop and refine long-term strategies that will place this municipality at the forefront of consumers’ minds as a tourist destination, as opposed to being known merely as a second-choice place to stay.
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