Simple and effective performance indicators for hotel sales

11 November 2021
Sales management in hotels is overseeing and leading salespeople to create strong relationships with customers and potential customers to win more contracts. It is all about working in the most productive way to bring in more business to the hotel.

There are only two types of deals in hotels. One is when the hotel receives an inquiry to buy something for specific or somewhat specific dates, such as an inquiry for a meeting or a wedding. The other is a vague contract to purchase something in the future, such as a corporate negotiated contract for transient business travel. The question is whether the customer wants to buy something now or something sometime in the future? Hotels need the best salespeople to win both types of deals in heavy competition with other hotels. Therefore, hotels must invest in training and development for their salespeople, create an engaging and motivating culture, to leverage each salesperson's strengths. Furthermore, the commercial manager must use positive reinforcement to create an uplifting environment, attract and retain the right people, and, finally, ensure that the salespeople have the best tools and systems to succeed.

KPIs for sales

When the commercial manager has created this base of good working conditions, the next step is to set goals and measure the essential KPIs. 

When it comes to KPIs, less is more, and therefore it's vital to identify and track only the right sales KPIs and metrics that make sense for hotel B2B sales. For example, one set of KPIs should measure how well the sales team handles inquiries. The other should show how the sales team manages customer contracts.

KPIs for inquiries

The number of incoming inquiries indicates how popular the hotel is. The hotel's attractiveness results from marketing, past guest experiences, reviews, the quality of the facilities, price, and customer relationships built and maintained by the sales team. Therefore, the number of incoming inquiries is a leading indicator predicting future success. The next step is to measure how many of these deals the sales team wins, which shows how good the sales team is in sales. 

KPIs for customer contracts

It is equally important to measure customer contracts. Here the production from each contract is the most crucial part to track. The salesperson is responsible for the contract production and should therefore stimulate the customer to buy. Measuring the number of activities is a good idea for a leading indicator that will predict future outcomes. Production in room nights and total revenue is the KPI to measure how good the sales team is in sales.

Balance leading and lagging indicators

Now there are two leading and two lagging indicators. Leading indicators predict the future, and lagging indicators measure success. These few proper KPIs will provide sales management with unique insights into the team's performance and help identify training opportunities, pipeline issues, maximize profit, optimize the sales process and daily sales tactics. Too many other KPIs will distract the salespersons and only drive cost.

About Demand Calendar B2B Sales CRM

Based on insights about the most critical workflows in hotel sales, we have developed a Hotel B2B sales CRM to help salespeople become more productive to win more deals. The system retrieves data from the hotel PMS and is as automated as possible. As a result, the hotel salesperson can focus on meeting customers to build solid relationships to bring in more business.