Presentation on theme: "How to Determine Market and Fair Share In assessing competition, a worthwhile exercise is to calculate your fair share and your market share against that."— Presentation transcript:
How to Determine Market and Fair Share In assessing competition, a worthwhile exercise is to calculate your fair share and your market share against that of the competition. First step is to set up a table for competitive properties showing property size in rooms, occupancy percentages, and the room nights sold for each.
Market Share Calculation Actual market share refers to the amount of room nights sold by your hotel relative to the total room nights sold by you and your competitors. It can be calculated for your hotel: Market Share = Property Room Nights Sold = 335 = 23.9% Total Market Room Nights Sold 1,400
Fair Share Calculation Fair share refers to the amount of room nights a property would sell if demand were distributed evenly based on the number of rooms among all properties. It is calculated as follows: Fair Share = Property Available Room Nights = 500 = 25.4% Total Market Available Room Nights 1,972
In this case, your hotel is not capturing its fair share of the market since it’s market share is falling one and a half percentage points under the fair share calculated for it. Market share and fair share computations are measures of success relative to competition. The absolute size of the share may or may not be important, but it is useful when measured over time to determine trends in market share and the impact of various marketing strategies. Summary of example
What is the difference between Objectives, Strategies and Tactics?
Objective A desired end-state. i.e. Increase the restaurant’s lunch-time meeting business.
Strategy A broad direction for a company to proceed in to achieve a goal. i.e. Promote and advertise more to small businesses in the area.
Tactics The step-by-step procedures to implement a strategy. Advertise in newspaper. Host open houses. Acquire list of businesses.
The Mission Statement A company’s mission is used to ensure unanimity of purpose within an organization and also to set it apart from other organizations of its type.
The Mission Statement (cont.) It’s a statement of attitude, outlook, and orientation rather than details. It’s a starting point for all marketing plan. It dictates all action plans.
Criteria of an Effective Mission Statement 1. It states what business the company is in, or will be in. It goes beyond the specific industry and states how we serve our customers. 2. It identifies the special competency of the firm and how it will be unique in the marketplace.
Criteria of an Effective Mission Statement (cont.) 3. It identifies the needs of its constituents and who they are. 4. It identifies the future or long term major goal of the company.