NASHVILLE, Tennessee—The most U.S. hotel rooms sold in a single month since STR began tracking hotel performance some 25 years ago was in July 2010, with more than 102 million roomnights sold. That statistic could be attributed simply to the return of leisure demand at a time when there were more hotel rooms in the U.S. than ever before.
But another interesting factor for the popularity of July 2010: It was the first month since 2005 when there were 10 weekend days in a single month. (There are typically nine). Another fact: A year later, July 2011 housed 10 weekend days as well, meaning when performance numbers are released in the coming weeks, the industry may see the same record broken again.
“If July starts on a weekend day, you have 10 weekend days rather than nine,” said Chad Church, director of special services at STR, while presenting “A special occasion: How calendar dates impact RevPAR” during the third annual Hotel Data Conference. “Interested parties need to understand how to measure impacts of calendar shifts on a hotel. The impact it can have on (revenue per available room) is pretty significant.”
By the numbers
For his presentation, Church aggregated STR daily hotel performance data starting January 2000 and ending July 2011. STR is the parent company of HotelNewsNow.com.
Breaking down the days of the week by average daily rate, STR data shows Tuesday commands the highest rate, at US$94.90. Friday commands the lowest, at an average of US$90.70.
“Looking at ADR specifically, trading an extra weekend day for a weekday would not positively impact monthly performance,” Church said.
Occupancy, on the other hand, is nearly reversed, with weekend nights leading the charge. Saturday registers an average occupancy of 68.2% while Sunday (considered a school night) registers 47%.
When factoring in occupancy and ultimately RevPAR, starting a month on a certain day makes a significant difference. Had January started on a Monday as opposed to a Sunday, for example, nationwide it would add an additional US$48 million in revenue and 477,000 roomnights to the month, driving RevPAR up 0.7%, Church said.
“You just beat your GM’s monthly projections,” Church said. “Seven-tenths of a percent, looking at total U.S., is a big number. It’s also significant in your local market.”
And ending a month on a certain day makes a difference, too. Church said, on average, ending July on a Satruday rather than a Sunday would increase industry-wide U.S. revenue for July by US$60 million and RevPAR by 0.8%.
Holiday impacts
Holidays have larger impacts on revenue than days of the week. If Valentine’s Day, for example, falls on a Friday or Saturday, the hotel industry reaps the benefits.
Other holidays that fall on a specific date but vary on day-of-week are Independence Day and New Year’s Eve. Church said if Valentine’s Day were always celebrated on a weekend, the industry would benefit by at least US$60 million a year; if Independence Day were always celebrated on the first Friday in July, it could mean US$100 million for the industry; and New Year’s Eve falling on a Friday or Saturday typically leads to a US$30-million revenue premium.
Church suggested hoteliers pay closer attention to days of the week when forecasting and pricing. “What I’m saying is take advantage of that, work with those numbers a little bit,” he said. “I don’t think people take full advantage of the situations.”
For example, he suggested implementing length-of-stay requirements when optimal days of week come into play.
“I think around holidays having length-of-stay requirements is something that can be leveraged even more,” he said. “If you’re in Aspen in January and you have an extra Saturday, plan for that.”
