Budget hotel brand growth potentialBy Tim Sander
A major budget hotel brand wanted to know what their brand’s growth potential was in the market. More specifically, the client also wanted to know how many hotel properties they should open beyond existing targets.
BVA BDRC developed a complex but effective study as a solution, utilising multiple different research techniques. We began with desk research to determine the current (and planned) total supply within the market. A re-analysis of existing sources was utilised to determine the total current ‘away from home’ accommodation demand. Omnibus research established the size of some 50 segments with different reasons for stays away from home and subsequent desk research forecast the growth potential of these. Telephone and web-based surveys were then undertaken to establish the client brand’s penetration of the different travel segments.
The study demonstrated that the market for this type of limited service property was far from saturated, with significant long-term prospects for the client brand. BVA BDRC’s recommendations helped the client develop its growth strategy and, following presentation of the plan to the investment community, analysts produced a series of ‘buy notes’. Within 3 weeks the client organisation’s share price had out-performed its benchmark sub-index by 8%.