This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies.  Find out more here  Close
Weekday vs. weekend
May 7 2009

Most of the chain scale segments report better weekday performance in occupancy and average daily rate. But the magnitude of a daily premium, regardless of whether it’s a weekday or weekend, is dramatic for most chain scale segments.

HENDERSONVILLE, Tennessee—During a downturn, a natural strategy is to modify pricing by day of the week, focusing on where you believe you have the best opportunity to maximize revenue. Typically, this will be the days where your demand, and therefore occupancy, are the strongest.

STR has been examining the weekday performance compared to the weekend for the total U.S. and chain scale segments. The weekdays are considered Monday through Thursday, and the weekend is Friday and Saturday. Sunday isn’t included in the calculations for two reasons. First, depending on your orientation, Sunday could be included in either time period, and second, the notoriously low occupancy on that day tends to distort the analysis. To help ensure consistency in the number of days in each period, the data used in this analysis is year to date (beginning on 3 January) through 25 April 2009. 

Generally, most of the chain scale segments report better weekday performance, in occupancy and average daily rate, because they tend to cater to the transient and group business traveler. But the magnitude of a daily premium, regardless of whether it’s a weekday or weekend, is dramatic for most chain scale segments. The one exception is luxury chains, in which the weekday ADR premium is only 2 percent. Because there’s such a small variation in the rate, it’s clear the luxury segment places the same value on its product regardless of the day of the week, despite falling occupancies. When demand begins to rebound in this segment, this strategy will prove useful because it should allow for a quicker recovery from revenue per available room declines.

In the upscale segment, the ADR premium for the weekday is 14.7 percent. It appears this segment is dropping its rates on the weekend to drive demand, with the ADR difference in the weekday over weekend ADR at about $15. As you can see in the charts, the RevPAR premium for the weekday in this segment is 27.3 percent. It appears that by dropping the rate by $15 on the weekend, this segment isn’t driving occupancy, and the RevPAR suffers substantially compared to the weekday numbers.

 

In the economy segment, the weekday ADR premium is -7 percent, meaning this segment is raising its rates on the weekend compared to the weekday. This shows the economy segment is aware of its customer base because this segment usually attracts more leisure travelers than business travelers and reports considerably higher occupancies during the weekend despite higher room rates.

STR will continue to monitor the weekday premium for these segments as the industry continues to struggle through this economic downturn.

COMMENTS   Show All
Login or enter a name   Post Your Comment  Check to follow this thread via email alerts (must be logged in)
(4000 characters max)

Comments that include links or URLs will be removed to avoid instances of spam. Also, comments that include profanity, lewdness, personal attacks, solicitations or advertising, or other similarly inappropriate or offensive comments or material will be removed from the site. You are fully responsible for the content you post. The opinions expressed in comments do not necessarily reflect the opinions of Hotel News Now or its parent company, STR and its affiliated companies. Please report any violations to our editorial staff

TRENDING
Baha Mar files voluntary Ch 11 bankruptcy
Data analysis: Top 25 vs rest of US markets
CEO sees hotels as Margaritaville’s sweet spot
Why brands boot their bottom performers
Front-desk staff as a distribution channel
When to buy in or bypass ‘by chain’ taglines
VIDEO
Apple stays true to its core post IPO
MCR pursuing smart hotel development
Deconstructing a guest review
With every great opportunity? A challenge
The time to build is now
LATEST NEWS
US hotel management contracts list
Overtime rule could hurt US hotel employees
Owners seek relief from rising property taxes
Introducing the newest KPI: The club sandwich
STR: US hotel results for week ending 27 June
Independent hotels hard to define, panel says
Contact Us
Hotel News Now
18500 Lake Rd.
Suite 310
Rocky River, Ohio 44116
        
Copyright © 2004 - 2015 Hotel News Now, a division of STR, Inc. All Rights Reserved.   Privacy