DiBPAR: the Vital Hotel Performance Metric You’ve Never Heard Of
Expertise, International, Fast
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In an industry transformed by the meteoric growth of online travel agents and the Direct
Booking Movement that sprang up in response, Revenue per Available Room (RevPAR) is no
longer enough as a performance metric.
We’ve seen plenty of hotels tracking their efforts to bring bookings back to direct. But just
tracking, for example, the percentage split between direct and OTA guests fails to tell the whole
story - and to drive the right actions. After all, the greatest thing about direct bookers is not only
do they cost less to acquire, but they also tend to spend more and be happier guests. That’s
why you should be tracking your DiBPAR (Direct Booking Revenue per Available Room).
𝑅𝑜𝑜𝑚 𝑟𝑒𝑣𝑒𝑛𝑢𝑒 𝑓𝑜𝑟 𝑑𝑖𝑟𝑒𝑐𝑡 𝑏𝑜𝑜𝑘𝑖𝑛𝑔𝑠 − 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑎𝑐𝑞𝑢𝑖𝑠𝑖𝑡𝑖𝑜𝑛 + 𝑛𝑒𝑡 𝑎𝑛𝑐𝑖𝑙𝑙𝑎𝑟𝑦 𝑟𝑒𝑣𝑒𝑛𝑢𝑒 𝑓𝑜𝑟 𝑑𝑖𝑟 𝑒𝑐𝑡 𝑏𝑜𝑜𝑘𝑒𝑟𝑠
DiBPAR makes sense for two reasons. The first is that it helps you track your performance as
you concentrate on driving more of your business via direct channels. Secondly, it focuses you
on making the most of your direct relationships by adding upsells and ancillaries.
It goes without saying that as a value-conscious marketplace, consumers will almost always go
for the cheapest option when booking any form of travel or accommodation. But when
consumers are presented the same offering for the same price, which do they choose?
A research shows that if the hotel price is the same price as the OTA, 65% of consumers would
choose to book directly with the hotel. But that’s not all. The same experiment also proved that
even in scenarios where there isn’t price parity, consumers still prefer to book direct. Where
there is a 1% difference in price with hotels being more expensive, 63% of consumers will still
choose the hotel. Where there is a 10% difference in price (again, with hotels being more
expensive), 51% of consumers will still choose to book directly with the hotel.
We’re seeing more and more hotels introduce a metric that tracks whether they’re getting more
direct bookings, but no-one is yet tracking the total value of those direct bookers. There's a
significant gap between revenue collected from direct bookers and revenue collected from guest
who come vie an OTA. Bookings via a hotel's website are more profitable by 9% than those on
OTAs - and this figure increases to almost 18% when you factor in ancillary spend.
The initial disparity comes from the amount lost to OTA commissions. On average, upscale US
hotels retain 93.2% of guest paid revenue when that guest books on their website. They only
retain 82.7% when that guest came through an OTA. And then, guests who book direct are
much more likely to spend on extras such as room upgrades and dining offers - so the net
revenue retained by the hotel rises even higher.
Hoteliers need to know the worth of the direct bookers they’re trying so hard to attract - and
DiBPAR might just be the way to work it out.