tourism kpi examples

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Measure these 9 top KPIs for travel management success

What types of kpis for travel management should you be measuring, financial metrics, how travelperk makes tracking travel spend simple, quality metrics, business metrics, sustainability metrics, 9 top kpis for travel management, 1. booking tool adoption.

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Top 4 Travel and Tourism KPIs

The tourism industry can be a challenging one to measure KPIs (Key Performance Indicators) for. You must ensure you keep your standards high to make sure customers return, and keep track of many moving parts. Tourism is an ever-growing industry with new people coming in all the time. With so many different offerings, it’s hard not to get lost in reporting metrics and never know which ones are most important for your success.

This article will discuss our top four Key Performance Indicators that we recommend when working with clients from the travel and tourism sector or working in the sector yourself. These KPIs are crucial in measuring the overall performance of tourism companies, as they show how well businesses are performing across the board without getting mired down by too much detail or data collection.

With a lot of different offerings, the tourism industry can be a challenging one to measure Key Performance Indicators for. You must ensure you keep your standards high to make sure customers return, and keep track of many moving parts.

What are Key Performance Indicators (KPIs)?

Key performance indicators are measurements within an organization that provide a simple way to determine how well it is performing. They will vary depending on your business, sector, and location.

When should I use a Key Performance Indicator?

Always. KPIs should be used to measure how well you are doing towards achieving your goals. It allows you to keep track of the key elements in your business and align them with current trends. KPIs can help identify problems, opportunities for improvement, or changes that need to occur because they allow you a bird's eye view

KPI 1: Customer satisfaction

A crucial KPI in the travel and tourism industry, you need to measure this reputation metric to evaluate the quality of your services. You want to aim for a high customer satisfaction rate, as that will highlight brand loyalty. In turn, you’ll notice an uptick in repeat business and recommendations.

How can you measure customer satisfaction in the tourism industry?

Try creating a customer satisfaction scorecard, ask your customers about their experience through surveys as part of your entry process (just make sure it doesn't get in the way of the user experience!). If not, try to find out if they're satisfied by measuring the number of complaints or compliments received as an indicator for customer satisfaction ratings. A more refined example of customer satisfaction KPIs can be the NPS score (Net Promoter Score).

What is a Net Promoter Score?

A Net Promoter Score (NPS) is a Key Performance Indicator measuring customer loyalty. The higher the score, the more likely it is that customers will engage with your business again in the future. NPS surveys ask respondents to answer one question: on a scale of 0-to-100, how likely are you to recommend our company

KPI 2: Number of visitors in a given time period vs transactions

This is a crucial Key Performance Indicator to measure as having a lot of guests or visitors may seem like everything is going well but can become increasingly misleading in the long-term if they're not spending any money.

The threshold for success here will vary on the industry and how you adjust will change as well. For example, those in the hotel industry may want to try and increase bar sales once they have people in the building. Tourist destinations may want to look at increasing sales of souvenirs or refreshments once someone's bought admission.

What should I do for my business if I'm not sure?

Speak to peers or experts in your industry; different industries, regions, and countries will have different economies, different KPIs, and potentially even a different solution to the same problem.

KPI 3: Staff turnover

In normal operating conditions, you can measure this KPI to identify any problems with staff retention. If staff members aren’t sticking around, you need to look at why. If people are leaving, you could be making a big loss on training time, wages, and even severance packages. It’s much cheaper for you to retain existing staff.

How can I find out why my staff members are leaving?

There are a few ways to discover why your employees are leaving. You can survey them or ask for feedback, and you might even want to do exit interviews with people who have left the company recently. However, it is better to speak to your employees before they leave and stop them from leaving in the first place!

KPI 4: Total revenue per available room

Tracking your total revenue per available room in the hotel industry highlights how much revenue your business is generating per available room. This key performance indicator is calculated using total income from all sources rather than just that earned by each room. If you’re not earning as much as you need per room, look at benchmarked results from your industry standard to see if you’re charging the correct price.

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Understanding Tourism KPIs for Destination Performance

Have you ever wondered how destinations measure their performance in attracting tourists and ensuring a successful visitor experience? Key Performance Indicators (KPIs) play a vital role in this evaluation process. By tracking specific metrics, destinations can gain valuable insights into their performance, identify areas for improvement, and make data-driven decisions to enhance their tourism offerings. In this article, we will explore the world of tourism KPIs, their significance, and how they contribute to destination performance. So, grab a cup of coffee and let’s dive into the fascinating world of tourism data!

A Closer Look at Tourism KPIs: Unveiling the Secrets of Destination Success

Tourism KPIs serve as the compass for destinations, helping them navigate the vast ocean of data to make sense of their performance. These indicators enable destination managers to monitor, assess, and optimize various aspects of their tourism ecosystem to attract more visitors and ensure their satisfaction.

Why Tourism KPIs Matter: The Importance of Measuring Destination Performance

KPIs act as a lens through which destinations can gauge their success in achieving specific tourism-related goals. By analyzing these metrics, destinations can identify patterns, trends, and areas that need improvement, enabling them to make data-driven decisions. Understanding tourism KPIs is crucial in enhancing destination competitiveness, sustainability, and overall visitor satisfaction.

The Types of Tourism KPIs: Measuring What Matters

Tourism KPIs can be classified into various categories, each focusing on a different aspect of destination performance. Let’s explore some of the most important types of KPIs:

• Arrival and Departure KPIs: These metrics track the number of visitors arriving and departing from a destination and provide valuable insights into the demand for tourism products and services.
• Occupancy and Revenue KPIs: These indicators measure the utilization of accommodation facilities and revenue generated from overnight stays, offering insights into the economic impact of tourism.
• Satisfaction and Loyalty KPIs: By measuring visitor satisfaction and loyalty, destinations can assess the quality of their tourism offerings and identify areas for improvement to enhance overall visitor experience.
• Environmental and Sustainability KPIs: These metrics evaluate a destination’s environmental impact, resource management, and commitment to sustainability, allowing destinations to monitor and improve their eco-friendly practices.
• Market Share and Competitiveness KPIs: These indicators enable destinations to assess their market position, competitiveness, and share in the global tourism market, helping them develop strategies to attract more visitors.

Choosing the Right Tourism KPIs: Tailoring Metrics to Destination Goals

While there are several standard KPIs that every destination should consider, it is crucial to select indicators that align with specific destination goals and objectives. By customizing their metrics, destinations can measure what truly matters to their unique context and target audience. Let’s delve into the process of selecting the right tourism KPIs:

Step 1: Define Destination Goals and Objectives

Before choosing KPIs, it is essential to have a clear understanding of the destination’s goals and objectives. Are you aiming to increase visitor numbers, improve visitor satisfaction, or enhance sustainability? Defining specific goals will help you narrow down the relevant KPIs.

Step 2: Identify Key Metrics for Each Goal

Once you have defined your goals, it’s time to identify the key metrics that will enable you to measure your progress towards those goals. For example, if your goal is to enhance visitor satisfaction, relevant metrics may include customer satisfaction scores, online reviews, or repeat visitation rates.

Step 3: Ensure Data Availability and Reliability

When selecting tourism KPIs, it is crucial to consider the availability and reliability of data. Ensure that the necessary data sources are accessible and provide accurate and up-to-date information. Collaborating with local tourism authorities, research institutions, and industry partners can help in gathering reliable data.

Step 4: Establish Baseline and Set Targets

To assess the impact of your efforts, establish a baseline by collecting data on your chosen KPIs. This baseline will serve as a benchmark against which you can measure your progress. Additionally, set targets for each KPI to have a clear vision of what you aim to achieve.

Analyzing and Interpreting Tourism KPIs: Transforming Data into Insights

Tracking tourism KPIs is just the first step. To unlock their true potential, destinations must analyze and interpret the data to gain actionable insights. Here are some approaches to analyzing and interpreting tourism KPIs effectively:

Data Visualization: Bringing KPIs to Life

Presenting data in a visually appealing and easy-to-understand format can help stakeholders grasp the insights more effectively. Utilizing graphs, charts, and tables can transform complex data into a compelling story that drives action.

Comparative Analysis: Benchmarking Performance

Comparing your KPIs against industry benchmarks or similar destinations can provide valuable insights into your performance relative to others. This analysis allows you to identify strengths, weaknesses, and areas for improvement, fostering a healthy sense of competition.

Identifying Trends and Patterns: Uncovering Hidden Opportunities

By closely examining your KPI data over time, you can identify trends, patterns, and anomalies that might indicate new opportunities or challenges. Understanding these trends can help you adapt your strategies and stay ahead in an ever-changing tourism landscape.

Qualitative Analysis: Going Beyond Numbers

Supplementing quantitative KPI data with qualitative information, such as visitor feedback, surveys, and focus groups, can provide a more holistic understanding of visitor perceptions and preferences. This qualitative analysis adds depth to your insights and aids in making more informed decisions.

Conclusion: Harnessing the Power of Tourism KPIs for Destination Success

Tourism KPIs are the compass that guides destinations towards success by providing insights into performance, enabling data-driven decisions, and fostering continuous improvement. By understanding the importance of measuring destination performance, selecting the right KPIs, and effectively analyzing the data, destinations can optimize their tourism offerings, attract more visitors, and ensure memorable experiences for all. So, embrace the world of tourism KPIs and take your destination to new heights!

References:

• https://en.wikipedia.org/wiki/Key_performance_indicator
• https://en.wikipedia.org/wiki/Tourism

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6 key performance indicators (KPIs) for tour and activity providers

Part of setting goals for your business is assessing what you can reasonably accomplish and what’s more of a pipe dream. However, the only way to know which goal is attainable is to measure your results as accurately as you can and then make informed decisions about where you can go from there. That’s why a set of key performance indicators (KPIs) is  vital for any growing business .

Let’s talk about the bottom line. At the end of the day, you want your business to turn a profit. The most basic and one of the most important KPIs is your overall revenue. There are plenty of great programs out there to help you organize your finances like Quickbooks, but if you can, it’s worth bringing in a professional bookkeeper to help advise on all financial decisions and manage them.

Using a booking system like TrekkSoft, you have a clear view of your turnover from all channels, and you can also connect your booking system to apps like Quickbooks using the Zapier integration .

Use TrekkSoft Business Intelligence and wider reporting to track your sales, turnover, and performance by channel.

2. Customer acquisition costs (CAC)

In a perfect world, you’d set up shop on a Monday and by Friday, you’d be booked with customers for the next three months. Unfortunately, it doesn’t work that way. As the saying goes, sometimes it takes money to make money. You have to market your business and do something to bring customers in the door. But at what cost? The CAC is essentially your marketing expense. It’s the money you have to attract and obtain new customers.

This is an area that a lot of small businesses struggle with. Especially as the best way to advertise can change from year to year, or even from one month to the next. A lot of businesses take a gamble on marketing themselves and burn up a lot of cash without the desired result. Now is the time to sit down and think about how much you’re really spending to earn each customer.

3. Customer retention

Once you have a customer, how long do they stick around? Do they come back? Do they bring their friends with them this time? Do they tell their loved ones and social media followers to check out your tour? As a business owner, you should be retaining your customers and making them happy, not just searching for new ones.

A great way to measure this is to offer customer rewards ( such as vouchers or discount codes ) for those who come back. Or, if your business relies on seasonal tourists, you could create a referral program where you offer a discount or prizes to customers who spread the word. Get creative with it, but just make sure you have something in place that’s easily measured.

4. Referral rate

Speaking of referrals, you need to track how many customers you gain from other customers. The referral rate helps you keep your CAC lower and statistically, has shown success in making your ROI higher. Referral programs work, so if you don’t have one already, it’s time to put one together for your company.

5. Cost of goods sold (COGS)

Now that we’ve talked about the importance of customers, it’s also important to look at the value of your offer. The cost of goods sold (COGS) are any expenses directly related to providing a service. For a tour operator, this includes the cost of staff salary, insurances and equipment for starters.

6. Customer satisfaction

A common mistake that businesses make is thinking that having more customers will solve all their business woes. But if your offer isn’t very good or the cost outweighs the value, your customers aren’t going to be very happy. Having a lot of customers won’t mean much if few of them are satisfied by the services you’re providing. In fact, it can work against you, as those customers are likely to share their experiences with friends, family members, or even strangers through reviews on TripAdvisor . There’s no doubt about it - this is a crucial KPI for all tour & activity companies that want sustainable growth.

Related reading:   How to improve your TripAdvisor ranking by understanding its algorithm  

Overall, there are dozens of KPIs you can look to to measure your company’s success. Those measurements will be different for each business, but these six performance indicators will help you to move ahead and ensure a successful year.

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10 Key Performance Indicators for Your Corporate Travel Program

By Tiffany Zerby on April 10, 2019 9:05 AM

Topics: How-To Tips Travel Management travel policy

The second quarter of 2019 is well underway, and for many, this is a time to look back at our goals and main initiatives for the year to determine whether we’re on track. It’s also a time to look forward, as many any companies may be starting to prepare reports for mid-year management meetings.

The common expression, “time flies,” is no joke. Time is an unstoppable force, but that doesn’t mean it has to get away from us. To measure your company’s progress towards its travel management goals in the here and now, it may be helpful to review relevant key performance indicators (KPIs).

If you’re not sure what data to look at, don’t worry! Below is a compiled list of KPIs that can be used to effectively measure your progress, especially if your travel program goals are similar to those described in our article, “ How to Achieve Your Travel Program Goals in 2019 .”

1. Travel Spend Concentration

Analyzing travel spend is a given, but we recommend that companies dig deeper and make sure that they have a full picture (i.e. access to all global data). For example, how much is spent per country, region, or business unit/department? How concentrated is your travel spend on specific routes or cities? Understanding this information will help you plan accordingly as you grow and can also be leveraged to improve your supplier contracts.

2. Online Adoption

What percentage of your company’s airline tickets are booked through the online booking tool (OBT)?  If most of your travelers are booking through an agent as opposed to utilizing the OBT, this may be driving up costs, as agent-assisted bookings usually require a higher service fee.

3. Traveler Experience

Whether your travelers are booking online or with an agent, it’s important to check in with them to inquire about their experience and ask for feedback. This will help you evaluate the level of service received and how the online booking tool is functioning. It can also help you identify areas that need improvement. 

4. Negotiated Savings

If you have already negotiated rates with preferred suppliers based on volume and market share, it’s time to evaluate how much these negotiated rates have saved you. To calculate, take the market rate and subtract the negotiated rate, then multiply by the total amount purchased at the negotiated rate.

5. Supplier Contracts

How much of your spend is under contract? How competitive is your contract? Plus, how are you measuring up on your promises to suppliers? Answering these questions year after year is important for maintaining an optimized relationship with your suppliers.

6. Potential for Expansion

Are you continually evaluating your programs to see if you ought to contract with additional countries? This is where the travel spend concentration comes into play, as there could be unrealized opportunities to improve your program by utilizing in-country travel management services. Many countries, like Canada, even offer lower airfare when you book the travel in country.

7. Program Leakage

How many of your travelers’ bookings are not only out of policy but also made outside of the approved booking channels? Sometimes travelers do go rogue thinking that they’re saving the company money, but guess what? This could be costing you more.

8. Advance Booking Non-Compliance

Minimizing last-minute bookings usually results in lower airfares. Are your travelers booking far enough in advance? Need to compare your travelers’ bookings against the recommended time frame? Check out our article, “ How to Reduce Travel & Expense Costs for Your Company ,” to learn the best times to buy your ticket depending on the season.

9. Re-booking Rate

Along with evaluating how far in advance bookings were made, it’s also powerful to evaluate how often bookings were changed after ticketing. Ticket changes often bring additional costs, so insight into how often changes occur could allow you to determine whether non-refundable fares should be allowed within your travel policy. Please note that while non-refundable tickets are often reusable in the U.S. this is not the case in every country.

10. Readiness to Respond

Do you have access to the location information you need to be able to act quickly in the event of an emergency? To calculate, take the number of travelers you have location information on and divide that by your total number of travelers at any given time.

Please remember that the above-mentioned KPIs are only a few general recommendations. If you would like to get specific suggestions from our team, or if you need assistance calculating any of the above, contact your World Travel, Inc. Account Manager or reach out to our sales team at [email protected] .

Are there other KPIs you would like added to this list?

Feel free to share these for fellow readers in the comments below!

Written by Tiffany Zerby

Previous post.

How to Achieve Your Travel Program Goals in 2019

7 Hot Topics in Corporate Travel Management

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Unlocking Success: Essential KPIs for Any Travel Agency

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Percentage increase in repeat customers

Customer satisfaction rating, revenue growth rate, average booking size, average booking lead time.

• Number of corporate clients
• Percentage of on-time-flightarrivals

As a seasoned entrepreneur, you know that growth is critical for any business, and measuring progress is just as important to ensure that goals are being met. And in the travel industry, tracking Key Performance Indicator (KPIs) is crucial for the success of any travel agency today.

The percentage increase in repeat customers is an essential metric for any travel agency looking to ensure customer loyalty. With repeat business making up 63% of revenue generated by the travel industry, it's essential to track this metric to nurture repeat business and gauge customer satisfaction:

• Average repeat customer rate for top companies in the industry is 19.9%
• Every 1% increase in the number of repeat customers can result in a 10% increase in revenue

Customer satisfaction rating is another crucial KPI to consider. By tracking satisfaction levels, companies can identify areas that need improvement and fine-tune their services to meet the needs of their clients:

• Over 90% of customers read reviews before booking their travel
• Customer satisfaction rating has a direct correlation to customer loyalty and repeat business

Stay with us, and we'll walk you through more key metric evaluations, including revenue growth rate, average booking size, average booking lead time, number of corporate clients , and percentage of on-time-flight arrivals to ensure your travel agency's success.

As a travel agency, tracking the percentage increase in repeat customers is crucial. This KPI measures the percentage of customers who have used your services multiple times, indicating the effectiveness of your customer retention strategies. Below are the sub-headers to understand the metric in more detail.

The percentage increase in repeat customers measures the percentage growth in customers who have used your services again within a specific period.

This KPI helps you evaluate the effectiveness of your customer retention strategies. It also reveals whether your customers are satisfied with the service you provide.

How To Calculate KPI

The formula for calculating the percentage increase in repeat customers is:

For instance, if your travel agency had 100 unique customers in the previous period and 20 customers used your services again in the current period, then the percentage increase in repeat customers would be:

Calculation Example

Suppose a travel agency had 500 unique customers last year, and 100 of them used the agency's services again this year. The previous period's repeat customers were 50. Using the formula, we can calculate the percentage increase in repeat customers as follows:

Therefore, the percentage increase in repeat customers is 10%.

KPI Advantages

• The metric helps measure customer satisfaction and loyalty towards the agency.
• A high percentage increase in repeat customers indicates that the agency has an effective customer retention strategy.
• The KPI can help identify recurring revenue opportunities, allowing the agency to allocate its resources more efficiently.

KPI Disadvantages

• Tracking the percentage increase in repeat customers alone may not give the full picture of customer satisfaction and retention.
• External factors such as a global pandemic can significantly impact the KPI and the travel industry in general.
• Travel agencies may experience seasonal fluctuations, leading to inconsistent results.

KPI Industry Benchmarks

The percentage increase in repeat customers varies considerably based on the type of travel agency, services offered, and target market. However, the average percentage increase in repeat customers in the travel industry hovers between 5% and 15%.

Tips & Tricks

• Offering personalized travel packages and loyalty programs can increase the percentage of repeat customers.
• Providing excellent customer service during all phases of travel can improve customer satisfaction and retention.
• Monitoring customer feedback and acting upon it can help identify areas that need improvement and enhance customer retention.

As a travel agency, customer satisfaction rating is one of the most important key performance indicators (KPI) to track and measure. It can help you understand how well your agency is serving your customers and if there are any areas that need improvement.

Customer satisfaction rating is a KPI that measures a customer's overall satisfaction with the services or products provided by a travel agency. It is usually measured through surveys or feedback forms that ask customers to rate their experience with the agency.

A high customer satisfaction rating indicates that your agency is meeting the needs and expectations of your customers, resulting in repeat business and positive referrals. On the other hand, a low customer satisfaction rating could be an indication of problems within your agency that need to be addressed.

To calculate customer satisfaction rating, first, you need to gather feedback from your customers. This can be done through online surveys, feedback forms, or even through social media platforms. The most common way to measure customer satisfaction is by using a Likert scale, which ranges from 1-5 or 1-10. Customers are asked to rate their experience, with 1 being the lowest and 5 being the highest level of satisfaction.

Customer satisfaction rating = (Total number of satisfied customers / Total number of respondents) x 100

Let's say you sent out a customer feedback survey to 100 customers of your travel agency, and 80 responded. Out of those 80, 70 customers indicated that they were satisfied with the services provided by your agency.

Customer satisfaction rating = (70 / 80) x 100 = 87.5%

• Helps you measure customer loyalty and retention
• Provides valuable insights into areas for improvement
• Helps you identify which products or services are performing well and should be prioritized
• Results may be biased depending on the type of survey or feedback form used
• Customers may not always provide honest feedback
• Subjective and may not be an accurate indicator of overall business performance

According to a recent survey by the American Customer Satisfaction Index (ACSI), the average customer satisfaction rating for the travel industry is 76 out of 100. However, it is important to note that benchmarks may vary depending on the type of travel agency and target audience.

• Track customer satisfaction ratings on a regular basis to identify trends and patterns
• Use feedback from unsatisfied customers to improve your services and avoid similar issues in the future
• Consider offering incentives for customers to leave feedback, such as discounts or coupon codes for future travel bookings

Revenue growth rate is a KPI used to measure the increase or decrease in a business's revenue over a specific period. It is an essential metric for travel agencies and can help them identify trends and track progress toward their financial goals. In this chapter, we will discuss the definition, use case, how to calculate KPI, calculation example, KPI advantages, KPI disadvantages, and industry benchmarks for revenue growth rate.

Revenue growth rate is the percentage change in revenue over a specific period. It is calculated by subtracting the revenue from the previous period from the current revenue, dividing the result by the revenue from the previous period, and then multiplying the result by 100. The formula for revenue growth rate is:

The revenue growth rate KPI is essential for travel agencies to track their financial performance. By measuring revenue growth rate, travel agencies can identify whether their sales and marketing strategies are effective in generating revenue. Additionally, revenue growth rate can help travel agencies identify areas where they need to make changes to increase revenue.

To calculate revenue growth rate, you need to collect the revenue data for the previous period and the current period. Once you have this data, follow the formula below:

Let's assume a travel agency had revenue of $200,000 in the previous year and revenue of $250,000 in the current year. To calculate the revenue growth rate, we would follow the formula below:

Therefore, the travel agency's revenue growth rate for the current year is 25%.

• Helps travel agencies track financial performance
• Identifies trends and areas where changes are needed to improve revenue
• Provides a measure of the effectiveness of sales and marketing strategies
• Does not consider the cost of generating revenue
• May be influenced by non-financial factors that impact revenue

According to the Travel and Tourism Research Association (TTRA), the average revenue growth rate for travel agencies in the United States is 3.5%. However, this varies depending on the size and type of travel agency.

• Compare your revenue growth rate to the industry benchmark to see how your travel agency is performing compared to others in the industry.
• Consider using revenue growth rate as part of a comprehensive financial analysis that includes other KPIs.
• Track revenue growth rate over time to identify trends and make informed decisions about sales and marketing strategies.

As a travel agency, it's important to track your average booking size KPI. This metric measures the average amount of money spent per booking. It can help you understand your customers' spending habits and improve your pricing strategy.

Average booking size is a Key Performance Indicator (KPI) that measures the average amount of money spent per booking. It takes into account all bookings made during a specific period and divides the total revenue by the number of bookings.

This KPI is essential for travel agencies to understand their customers' spending habits and improve their pricing strategy. By tracking the average booking size, travel agencies can also identify high-value customers and create personalized marketing campaigns for them.

Formula: total revenue / number of bookings

Example: If the total revenue for a month is $50,000 and the number of bookings made is 500, the average booking size would be:

Average booking size = $50,000 / 500 = $100

• Helps travel agencies understand customer spending habits
• Improves pricing strategy
• Identifies high-value customers for personalized marketing campaigns
• Does not consider the length of stay or the type of booking
• May not accurately reflect the agency's profitability
• May be affected by factors outside the agency's control, such as external events or economic conditions
• The average booking size for leisure travel is around $1,000
• The average booking size for corporate travel is around $500
• The average booking size for luxury travel is around $5,000
• Offer packages or bundled deals to increase the average booking size
• Create loyalty programs to encourage customers to book with you again
• Track the average booking size for different segments of your business, such as leisure, corporate, and luxury travel

In the travel industry, understanding how long it takes from the start of the booking process to when a customer actually books can be a crucial metric. The average booking lead time measures precisely that and helps businesses plan their marketing and customer outreach efforts.

The average booking lead time is defined as the average number of days between a customer's first search or inquiry and when they make their final booking.

Knowing the average booking lead time helps travel agencies to adapt their marketing and sales strategies to be more effective and targeted. For instance, if most customers book within a few days of the initial inquiry, it may be more worthwhile to focus on capturing customers who are in the researching phase of their travels.

To calculate the average booking lead time, you need to find the time difference in days between the date of first contact from the customer to the booking date. You then sum all the values and divide by the number of bookings made within a specified time period.

Average booking lead time = (Sum of time difference in days between first contact and booking) / number of bookings made

For example, let's say that over the past month, there were 100 bookings made and the total sum of time differences between initial contact and booking was 3000 days. To find the average booking lead time, you would divide 3000 by 100, for an average of 30 days.

Average booking lead time = 3000 days / 100 bookings = 30 days

• Allows tracking of trends in customer behavior over time
• Helps identify areas for improvement and opportunities for increased conversions
• Provides insights into the effectiveness of marketing and outreach efforts
• May be impacted by external factors such as seasonal fluctuations or events in the travel industry
• Can be difficult to measure accurately without robust data tracking and analysis tools
• Needs to be used in conjunction with other KPIs to provide a complete picture of business performance

Industry benchmarks for the average booking lead time in the travel industry can vary widely depending on the type of travel, location, and season. However, on average, the lead time ranges from 20 to 60 days.

Tips & Tricks:

• Consider giving incentives to customers who book sooner in the booking process, to try and shorten the average booking lead time.
• Use your average booking lead time metric in conjunction with other KPIs, such as customer acquisition cost or conversion rate, to get a more complete picture of business performance.
• Reevaluate your KPI tracking regularly to ensure your KPIs are still aligned with your business strategy and goals.

Number of Corporate Clients

As a travel agency, your number of corporate clients can be a critical metric to track. This KPI can provide insights into the overall health of your business and help you identify opportunities for growth.

• The number of corporate clients is the count of businesses or organizations that have booked travel services with your agency.
• This KPI can help you understand the size and scope of your corporate client base, as well as how it changes over time.
• It can also be used to measure the success of your sales and marketing efforts, as well as your ability to attract and retain corporate clients.

How to Calculate KPI

To calculate the number of corporate clients, use the following formula:

Number of Corporate Clients = Total number of businesses or organizations that have booked travel services with your agency

For example, let's say your agency has booked travel services for 50 different businesses in the past year. Your number of corporate clients would be:

Number of Corporate Clients = 50

• Provides valuable insights into the growth and health of your corporate client base.
• Can inform sales and marketing strategies to attract and retain more corporate clients.
• Helps to identify opportunities for growth and expansion in your target market.
• May not provide a complete picture of the profitability of your business or the value of each corporate client.
• Can be influenced by a wide range of factors outside of your control, such as changes in the economy or industry trends.
• May not be as relevant for smaller travel agencies with limited corporate client bases.
• According to industry research, the average number of corporate clients for travel agencies is around 150 per year. However, this can vary widely depending on the size and focus of your agency.

Tips and Tricks

• Consider segmenting your corporate clients by industry, size, or location to gain more detailed insights.
• Use this KPI in conjunction with other metrics, such as revenue per corporate client or total booking value, to get a more complete picture of your business's performance.
• Regularly review and update your client database to ensure you are tracking the most accurate and up-to-date information.

Percentage of On-Time Flight Arrivals

As a travel agency, your ultimate goal is to provide your clients with a seamless travel experience. Part of this experience is ensuring that their flights arrive at their destinations on time. Monitoring the percentage of on-time flight arrivals is an essential KPI for any travel agency. Let's take a closer look at this KPI.

The percentage of on-time flight arrivals is a KPI used to measure the percentage of flights that arrive at their destination on-time, without excessive delay or deviation.

This KPI is a reliable indicator of an airline's operational efficiency. At the same time, it provides valuable insight to travel agencies as they can determine which airlines have a higher percentage of on-time flight arrivals. This information can help in the decision-making process when choosing to partner with an airline or sell a particular flight itinerary.

The formula for calculating the percentage of on-time flight arrivals is:

Percentage of on-time flight arrivals = (Number of on-time flight arrivals / Total number of flights) x 100

For example, if an airline has 1000 flights with 850 arriving on time, the percentage of on-time flight arrivals is:

Percentage of on-time flight arrivals = (850 / 1000) x 100 = 85%

Let's say you are a travel agency that sells a package tour that includes airfare. You have partnered with three airlines for this package tour, and you want to compare their on-time flight performance for the past quarter. Here is the data you have gathered:

• Airline A: 250 flights with 190 on-time arrivals
• Airline B: 150 flights with 120 on-time arrivals
• Airline C: 300 flights with 240 on-time arrivals

You can calculate the percentage of on-time flight arrivals for each airline:

• Airline A: (190 / 250) x 100 = 76%
• Airline B: (120 / 150) x 100 = 80%
• Airline C: (240 / 300) x 100 = 80%

From these calculations, you can see that Airline A has the lowest percentage of on-time flight arrivals, while Airline B and C have the same percentage. This information can help you make more informed decisions about which airlines to partner with or which flights to recommend to your clients.

• Provides a reliable indicator of an airline's operational efficiency
• Helps travel agencies make more informed decisions about which airlines to partner with
• Allows travel agencies to recommend flights with higher percentages of on-time flight arrivals to clients
• Does not account for flights delayed due to weather conditions or air traffic control issues
• Some airlines may manipulate the data to make their on-time flight performance appear better than it actually is

The global average for on-time flight arrivals is around 85%. However, this percentage can vary significantly depending on the airline, the route, and the time of year. Some airlines may have a percentage of on-time flight arrivals higher than 90%, while others may have a percentage lower than 75%. It's essential to consider these factors when comparing on-time flight performance.

• Consider partnering with airlines that have a higher percentage of on-time flight arrivals to enhance your reputation as a reliable travel agency.
• Monitor on-time flight performance regularly, especially during peak travel periods, to provide your clients with the best travel experience.
• Compare on-time flight performance for different airlines or routes to determine which flights to recommend to your clients.

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Measuring your corporate travel KPIs

But numbers, tables and charts in themselves prove nothing. To demonstrate improvement over time, travel managers need to establish Key Performance Indicators (KPIs) and use data smartly in order to monitor progress against them. Here are the corporate travel KPIs you should consider to measure the success of your business travel program:

• Use of approved booking channels
• Traveler compliance with policy
• Supplier contract savings
• Traveler satisfaction and safety
• Carbon emissions

Spend and corporate travel savings

When you add up the cost of airfares, hotel rooms, ground transportation costs and meal expenses, it’s clear that your company is spending a significant part of its budget on corporate travel costs.

Therefore, tracking your spending and making corporate travel savings is an important KPI to set. You can measure these in different ways – such as by seeing how well you’ve negotiated supplier contracts, or how much visibility you have over bookings and payments. Here are some of the areas you could measure:

How many of your business travelers are using approved booking channels to arrange air travel, hotel rooms and ground transportation? Divide your ticketed and booked spend by your total travel spend and you’ll arrive at your level of booking visibility.

The higher this is, the more chance you’ll have of making big corporate travel savings. Ideally, 100% of your employees will be using approved booking channels such as your online booking tool – which only displays airfare results that fall within your corporate travel policy – so all spending can be recorded and measured.

• Use of approved forms of payment

It’s important to know the extent to which your business travelers are using approved forms of payment – such as a company credit card – to cover on-trip expenses like meal and taxi costs. Payment visibility is a key corporate travel metric – calculate it by dividing your travel-related spend on a company credit card by your total travel spend.

If all payments are channeled through company credit cards, you’ll find it much easier to monitor expenses and make further corporate travel savings. With the CWT AnalytIQs tool, travel managers can do this in real-time, and are able to react instantly when a booking is made outside of policy.

• Realized negotiated savings

How many corporate travel savings are you driving through discounts with preferred travel vendors? To work out the amount of corporate travel savings you can make by negotiating supplier contracts, multiply the difference between the market rate and the negotiated rate with the unit volume.

Make sure you’re using an accurate, realistic market rate by working out the fare a traveler would likely pay in the absence of a negotiated rate.

Corporate travel management policy and compliance

Corporate travel savings go hand in hand with a strong policy. According to CWT research, companies without robust corporate travel policies could be overspending by up to 15%.

A corporate travel policy provides clear guidelines that help reduce your business’s travel spend and meet your objectives, as well as improving employee security and wellbeing. The success of your policy can be defined by measuring a corporate travel compliance KPI that looks at:

• Cabin non-compliance

To what extent are your travelers complying with your cabin policy? With tickets in business class generally more expensive than seats in economy, this key component lets you know how much you could save by tightening up corporate travel compliance within your company.

By dividing the number of air and rail bookings outside existing policy by the total spend, you get your non-compliance rate. Ideally, you need to be aiming for zero non-compliance.

• Lowest logical airfare non-compliance

How many savings are you losing because the lowest airfare isn’t available? By subtracting the lowest logical airfare from the actual ticket price and then dividing the result by your overall airfare spend, you get your level of inadvertent non-compliance.

Again, this will ideally be zero. You can work towards lowering that figure with the CWT Price Tracking   – powered by Yapta’s FareIQ – which automatically cancels and rebooks tickets when it finds a cheaper deal to the same location, helping you to make key corporate travel savings.

• Hotel visibility

How many hotel reservations are being made through official channels? The more bookings made in this way, the more power you have to direct your travelers towards your preferred hotels, increasing compliance.

To find out your level of hotel visibility, divide your booked spend by your total hotel spend. Ideally, 100% of your employees will be using approved booking channels such as the myCWT app, which allows travelers to book hotels that fall within the policy’s allocated star rating or price per room.

If your employees book their own hotels, CWT’s Hotel Intel provides three tiers of information to select from, with hotel reviews written by business travelers who have actually stayed at that property, allowing your employees to make an informed choice about where they stay.

• CWT Hotel Intel Directory lets travelers see overall scoring and popularity based on reviews.
• CWT Hotel Intel Core shows both CWT and company-negotiated rates, displays full peer traveler reviews and encourages travelers to leave reviews after their trips
• CWT Hotel Intel Enhanced incorporates the Core elements as well as providing quarterly travel manager reporting. It also lets you activate or deactivate review capture, enables you to display traveler names on reviews or keep them anonymous, and limits hotel displays to company-preferred content only.

For additional peace of mind, your employees will always be guided to company-preferred and policy-compliant hotels.

A significant proportion of your budget will go on the corporate travel suppliers you use – predominantly air travel, hotel and ground transportation providers. Choosing the right suppliers can cut costs on every trip, adding up to significant savings.

This corporate travel KPI will indicate how well you can negotiate the best deals with suppliers by monitoring:

• Contract support

How well are you supporting your preferred corporate travel suppliers? Divide your booked spend with a supplier by the total amount contracted – the higher that number is, the more support you’re giving to your suppliers and the stronger your negotiating position.

• Contract savings

How do your negotiated airline, hotel, and rental car company rates compare to the undiscounted rates? Your financial stakeholders will want to know how good a deal you’re getting from your corporate travel suppliers.

Compare a supplier’s contracted prices with their undiscounted rates, and multiply the difference by the unit volume produced. Do this math for all the deals you’ve ever made with the supplier and you’ll know the savings you’re making.

• Traveler satisfaction

How happy are your travelers with your corporate travel program? It’s important they feel supported and safe when they’re traveling, so they can stay focused on the job.

You could measure traveler satisfaction by regularly running a survey that factors in their thoughts about the corporate travel suppliers you use, how safe they feel, and whether there are any areas they feel need improvement.

Calculating the difference between the average satisfaction score and the highest possible score will give you an idea of how much work you’ve got to do to improve traveler satisfaction.

Your business travelers’ safety and security are an important part of your corporate travel policy. Your employees are your responsibility, so it’s vital to have adequate processes in place to measure your effectiveness in this area.

From political unrest to severe weather, your travelers could face a number of risks when they’re on the road. This corporate travel KPI will measure your company’s ability to protect them. You will need to monitor:

• Profile completion

How complete are your travelers’ profiles? Having up-to-date personal information for your travelers is an essential step in corporate travel security

You can measure your progress in this area by creating a ‘completion score’ for each profile – taking into account name, address, phone number and other fields – and then dividing that number by the highest possible total.

If travelers’ profiles are all 100% complete, you’ll be able to reach them faster in an emergency.

• Location insight

Do you know where your employees are when they’re traveling? When an incident strikes – whether it’s a terrorist attack or a cancelled flight – you’ll be expected to react instantly.

Measure your readiness to respond by dividing the number of travelers whose whereabouts you know by the total number of travelers. CWT Program Messenger can also allow you to make contact instantly with any or all of your travelers, making it useful for an emergency.

The free myCWT travel app allows your employees to make last-minute bookings and check schedules whenever they face travel risks, giving you extra peace of mind.

Corporate Social Responsibility

Corporate Social Responsibility (CSR) is more important than ever. Many potential customers and clients are more likely to choose a company with a CSR strategy that sends out a powerful statement about their commitment to tackling social, environmental, ethical and human rights concerns.

You could set a corporate travel KPI that measures your company’s ability to keep carbon emissions to a minimum by looking at:

• Carbon visibility

What’s the carbon impact of your travel program – and how well do you measure it? Set up a standard scale across each category of corporate travel – air travel, hotel stays and ground transportation – ranging from ‘excellent’, to ‘adequate’ and ‘inadequate’.

Give yourself an ‘excellent’ rating if you use a carbon calculator to work out your footprint in each journey, ‘adequate’ if you use a GHG Protocol-approved method for estimating your carbon emissions, or ‘inadequate’ if you don’t have a method in place. Attribute points to each rating and tally up your average score over time.

• Rail vs air

How often are your travelers using rail over air in markets that offer both options? As rail travel generally produces less carbon per passenger than air travel, you can calculate the environmental benefits of your corporate travel program by dividing the number of rail tickets by the total number of rail and air tickets.

While you couldn’t expect rail to account for 100% of travel, a higher number is better.

The specific corporate travel metrics and key components outlined in this guide will help measure the success of your travel program. However, they should be treated as suggestions.

When it comes to setting your corporate travel KPIs, there’s no one-size-fits-all approach, because every business’s culture, goals and employee needs are different. It’s important that you set the KPIs that are right for your company.

Connect with CWT now to start your journey to more efficient corporate travel.

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Boost Your Travel Agency's Success: Track Core 7 KPI Metrics!

By henry sheykin, resources on experience-based travel agency.

• Financial Model
• Business Plan
• Value Proposition
• One-Page Business Plan
• SWOT Analysis
• Business Model
• Marketing Plan
• Customer satisfaction
• Number of repeat customers

Average customer rating/reviews

Number of unique experiences offered, percentage of revenue from experiential travel services, number of partnerships with local experts and communities, percentage of revenue from sustainable and responsible tourism initiatives.

Welcome to our blog post on the 7 industry-specific Key Performance Indicators (KPIs) for Experience-Based Travel Agencies. As the travel industry becomes increasingly focused on providing unique and memorable experiences, measuring success requires a comprehensive understanding of key metrics. In this article, we will explore the KPIs that can help Experience-Based Travel Agencies gauge their performance and make informed business decisions. From customer satisfaction and repeat customers to partnerships with local experts and revenue from sustainable tourism initiatives, these KPIs will provide valuable insights for agencies looking to thrive in the experiential travel market. So, let's dive in and uncover these essential KPIs.

Customer satisfaction: One of the primary KPIs for Experience-Based Travel Agencies is customer satisfaction. Ensuring that travelers have a positive and fulfilling experience is crucial for long-term success and establishes credibility within the industry. Tracking customer satisfaction metrics allows agencies to address any areas of improvement and deliver exceptional service consistently.

Number of repeat customers: Another important KPI is the number of repeat customers. Repeat customers are a testament to the agency's ability to provide enjoyable experiences that leave a lasting impression. By monitoring this metric, agencies can assess their customer loyalty and identify strategies to enhance customer retention.

Average customer rating/reviews: Measuring the average customer rating and reviews offers valuable insights into the quality of an agency's services. Positive reviews and high ratings authenticate the agency's commitment to exceptional experiences, while negative feedback serves as an opportunity for improvement and refining their offerings.

Number of unique experiences offered: In an industry focused on creating unforgettable moments, the number of unique experiences offered is a significant KPI. It reflects the agency's ability to curate a diverse range of experiences that cater to various traveler preferences. Monitoring this metric ensures that agencies continually innovate and stay ahead in the competitive market.

Percentage of revenue from experiential travel services: The percentage of revenue from experiential travel services is a crucial financial KPI. As the demand for immersive travel experiences grows, tracking the contribution of experiential travel services to overall revenue helps agencies gauge the effectiveness of their offerings and make informed financial decisions.

Number of partnerships with local experts and communities: Collaborating with local experts and communities is a strategic move for Experience-Based Travel Agencies. This KPI signifies the agency's commitment to supporting local economies and providing authentic experiences. Monitoring partnerships allows agencies to measure community engagement and assess the impact of their collaborations.

Percentage of revenue from sustainable and responsible tourism initiatives: As sustainability gains prominence in the travel industry, monitoring the percentage of revenue from sustainable and responsible tourism initiatives is a key metric. This KPI demonstrates an agency's dedication to environmentally friendly practices and responsible travel. It also resonates with travelers who prioritize ethical and sustainable experiences.

Customer Satisfaction

Customer satisfaction is a key performance indicator (KPI) that measures how well a travel agency is meeting the needs and expectations of its customers. It assesses their overall satisfaction with the services provided, including booking experiences, accommodations, and customer support.

Advantages of Tracking

Tracking customer satisfaction allows experience-based travel agencies to identify areas of improvement and make necessary adjustments to enhance the overall customer experience. It helps in building long-lasting relationships with clients, increasing customer loyalty, and driving repeat business. Additionally, positive customer satisfaction can lead to positive word-of-mouth referrals, benefiting the agency's reputation.

Industry Benchmarks

Industry benchmarks for customer satisfaction in the travel agency sector can vary depending on the specific target market and the services offered. However, on average, a customer satisfaction score above 80% is considered good, while scores above 90% are considered excellent. Comparing the agency's performance to industry averages can provide insights into its competitive position.

How To Calculate

The formula to calculate customer satisfaction is:

Customer Satisfaction = (Number of Satisfied Customers / Total Number of Customers) * 100

Example of Calculation

Suppose an experience-based travel agency has received feedback from 500 customers, of which 450 stated that they were satisfied with the services provided. To calculate customer satisfaction:

Customer Satisfaction = (450 / 500) * 100 = 90%

Tips and Tricks of the KPI

• Regularly collect customer feedback: Implement a system to gather feedback from customers after their travel experiences. This can be in the form of surveys, online reviews, or personal follow-ups.
• Act promptly on negative feedback: Address any negative feedback or concerns raised by dissatisfied customers promptly and take appropriate actions to rectify the situation.
• Train staff to prioritize customer satisfaction: Provide training to employees on customer service skills, focusing on empathy, problem-solving, and effective communication.
• Monitor customer satisfaction trends: Continuously track customer satisfaction over time to identify any patterns, trends, or recurring issues. This enables proactive measures to further improve the overall customer experience.

Number of Repeat Customers

Number of repeat customers refers to the count of customers who have booked a trip or used the services of an experience-based travel agency more than once. It is an important metric for measuring customer loyalty and retention.

Tracking the number of repeat customers provides valuable insights into the agency's ability to deliver exceptional experiences and build long-lasting relationships with its clients. It signifies customer satisfaction, trust, and the potential for future business opportunities.

Industry benchmarks for the number of repeat customers may vary depending on the specific market and competition. Generally, a high percentage of repeat customers indicates a successful agency with strong customer loyalty.

To calculate the number of repeat customers, divide the total count of customers who have booked more than one trip or used the agency's services multiple times by the total count of unique customers during a specific period. Multiply the result by 100 to get the percentage.

Number of Repeat Customers (%) = (Number of Repeat Customers / Total Unique Customers) x 100

Suppose an experience-based travel agency has served 500 unique customers in a year. Out of those, 100 customers have booked multiple trips with the agency. To calculate the number of repeat customers:

• Number of Repeat Customers = 100
• Total Unique Customers = 500

Using the formula:

Number of Repeat Customers (%) = (100 / 500) x 100 = 20%

- Focus on delivering exceptional experiences to encourage repeat business.

- Implement customer loyalty programs to incentivize customers to return.

- Gather and analyze feedback from repeat customers to identify areas for improvement.

- Engage with customers through personalized communication and offers.

- Develop strong relationships with customers by providing outstanding customer service.

The average customer rating/reviews is a key performance indicator (KPI) that measures the satisfaction level of customers who have used experience-based travel agencies. It is typically calculated based on customer feedback or reviews, which are collected through surveys or online platforms.

Tracking the average customer rating/reviews provides valuable insights into the quality of service provided by the travel agency. It helps identify areas of improvement and allows the agency to make necessary adjustments to enhance customer satisfaction. Additionally, a high average rating can serve as a powerful marketing tool, attracting more potential customers and establishing the agency as a reputable and reliable choice in the industry.

Industry benchmarks for average customer rating/reviews may vary depending on the specific niche of experience-based travel. However, a generally accepted benchmark is a rating of 4 or above on a scale of 1 to 5. This indicates a high level of customer satisfaction and a positive overall experience with the travel agency.

To calculate the average customer rating/reviews, follow this formula:

Average customer rating/reviews = Total ratings/reviews ÷ Number of ratings/reviews

Let's assume that an experience-based travel agency has received a total of 50 ratings from customers. The sum of all the ratings is 225. To calculate the average customer rating/reviews:

Average customer rating/reviews = 225 ÷ 50 = 4.5

Therefore, the average customer rating/reviews for this travel agency is 4.5.

• Regularly monitor and analyze customer feedback to identify patterns and trends.
• Address any negative feedback promptly and take necessary steps to improve customer satisfaction.
• Encourage customers to leave reviews by offering incentives or rewards.
• Showcase positive reviews on your website and social media platforms to build trust and credibility.
• Consider using automated tools to collect and analyze customer feedback, making the process more efficient and accurate.

The number of unique experiences offered is a key performance indicator (KPI) that measures the variety and diversity of experiences provided by an experience-based travel agency. It quantifies the different types of activities, tours, and events available to customers.

Tracking the number of unique experiences offered allows a travel agency to assess its product range and competitiveness. It helps identify gaps in the market and opportunities for expansion or improvement. Furthermore, it can be used to showcase the agency's ability to cater to diverse traveler preferences.

Since industry-specific benchmarks for the number of unique experiences are highly dependent on the niche and target market of the travel agency, it is essential to compare against similar businesses or conduct market research to determine relevant benchmarks.

To calculate the number of unique experiences offered, use the following formula:

Number of unique experiences offered = Total number of distinct experiences

Let's say an experience-based travel agency offers a total of 100 different experiences, including sightseeing tours, adventure activities, and cultural events. In this case, the number of unique experiences offered would be 100.

• Regularly update and expand the range of experiences offered to keep up with changing customer preferences.
• Consider customer feedback and market demand to ensure the inclusion of sought-after experiences.
• Collaborate with local partners and experts to curate unique and authentic experiences.
• Promote the variety of experiences through marketing materials and online platforms to attract potential customers.

The Percentage of revenue from experiential travel services is a Key Performance Indicator (KPI) that measures the proportion of a travel agency's revenue that comes from offering experience-based travel services. It helps assess the agency's success in attracting and converting customers for their experiential offerings.

Tracking the percentage of revenue from experiential travel services provides valuable insights into the agency's business performance. It allows them to gauge the popularity and profitability of their experience-based offerings compared to other travel services, enabling them to make informed decisions regarding resource allocation and marketing strategies.

Industry benchmarks for the percentage of revenue from experiential travel services might vary depending on the specific niche and target market of the travel agency. However, according to industry data, a well-performing experience-based travel agency usually aims for a revenue percentage between 30% and 50% from their experiential travel services.

To calculate the percentage of revenue from experiential travel services, divide the total revenue generated from experience-based offerings by the total revenue for the agency, then multiply the result by 100.

Percentage of revenue from experiential travel services formula:

(Revenue from experiential travel services / Total revenue) * 100

Let's say a travel agency generated $1,500,000 in revenue from experiential travel services over a year, and their total revenue for that period was $4,000,000. To calculate the percentage of revenue from experiential travel services:

Percentage of revenue from experiential travel services = ($1,500,000 / $4,000,000) * 100 = 37.5%

• Regularly track the percentage of revenue from experiential travel services to identify trends and patterns.
• Compare the KPI with industry benchmarks to assess your agency's performance.
• Invest in marketing strategies to promote your experience-based travel offerings and potentially increase the percentage of revenue from these services.
• Continuously analyze customer preferences and adapt your experience-based offerings accordingly to maximize revenue.

In the experience-based travel industry, the number of partnerships with local experts and communities refers to the total number of collaborative relationships the travel agency has established with individuals, organizations, and communities in the destinations they offer experiences in.

Tracking the number of partnerships with local experts and communities is crucial for experience-based travel agencies as it directly impacts the quality, authenticity, and uniqueness of the experiences they provide to their clients. Establishing partnerships allows agencies to tap into the knowledge and resources of these experts and communities, resulting in a more enriching and immersive travel experience for their customers.

Industry benchmarks for the number of partnerships with local experts and communities can vary depending on the size and focus of the travel agency. However, the general consensus is that a higher number of partnerships indicates a more extensive network and a wider range of unique experiences to offer to clients.

To calculate the number of partnerships with local experts and communities, simply count the total number of active collaborative relationships the travel agency currently has. This includes partnerships with individual experts, local tour operators, community-based organizations, and any other relevant entities.

Number of partnerships with local experts and communities = Total number of active partnerships

Suppose an experience-based travel agency has partnerships with 15 individual experts, 8 local tour operators, and 5 community-based organizations. The total number of partnerships with local experts and communities would be 15 + 8 + 5 = 28 .

• Regularly evaluate the existing partnerships and seek new collaborations to expand the network and diversify the range of experiences offered.
• Focus on developing long-term relationships with local experts and communities to foster mutual trust and understanding.
• Encourage feedback and suggestions from partners to continuously improve the quality of the experiences.

The percentage of revenue from sustainable and responsible tourism initiatives measures the portion of a travel agency's total revenue that comes from activities focused on promoting sustainable and responsible tourism practices. This KPI helps assess the agency's commitment to environmentally-friendly and socially responsible travel.

Tracking the percentage of revenue from sustainable and responsible tourism initiatives provides insights into the agency's sustainability efforts and their alignment with customer preferences. It also demonstrates the agency's dedication to corporate social responsibility, which can enhance its reputation and appeal to eco-conscious travelers.

Industry benchmarks for this KPI are not readily available due to the unique nature of each experience-based travel agency and the varying emphasis placed on sustainable and responsible tourism. However, conducting internal analyses and comparing the results against previous periods can serve as a reference point for improvement.

To calculate the percentage of revenue from sustainable and responsible tourism initiatives, use the following formula:

Percentage of revenue from sustainable and responsible tourism initiatives = (Revenue from sustainable and responsible tourism initiatives / Total revenue) * 100%

Let's assume an experience-based travel agency generated $500,000 in total revenue, with $100,000 generated from sustainable and responsible tourism initiatives. Using the formula, we can calculate the percentage as follows:

Percentage of revenue from sustainable and responsible tourism initiatives = ($100,000 / $500,000) * 100% = 20%

• Ensure accurate categorization and tracking of revenue specifically from sustainable and responsible tourism activities.
• Regularly review and update the definition of sustainable and responsible tourism initiatives to align with industry standards and evolving customer expectations.
• Consider promoting sustainable and responsible tourism initiatives more prominently to increase revenue in this area.
• Collaborate with partners and suppliers committed to sustainable practices to strengthen the agency's offerings in this segment.

In conclusion, developing industry-specific Key Performance Indicators (KPIs) is crucial for measuring the success and efficiency of an Experience-Based Travel Agency business. These KPIs serve as valuable benchmarks, guiding businesses towards achieving their goals and objectives. By tracking and analyzing these seven KPIs, travel agencies can gain insights into their performance and make data-driven decisions to enhance customer experiences and drive business growth. With a professional approach and a focus on continuous improvement, Experience-Based Travel Agencies can thrive in a competitive market and deliver exceptional services to their customers.

• 1. Customer Satisfaction Metrics
• 2. Net Promoter Score (NPS)
• 3. Booking Conversion Rate
• 4. Average Booking Value
• 5. Repeat Customer Rate
• 6. Customer Lifetime Value (CLV)
• 7. Travel Agency Revenue Growth

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Travel Management KPIs Your Business Should Measure

Travel Managers should establish and closely monitor important key performance indicators. What travel management KPIs are most relevant? Find out in our guide to corporate travel program metrics.

Is your travel program thriving or just barely surviving? Without the right travel management KPIs in place, your answer to that question is just an opinion.

But what metrics should matter? In many cases, businesses are awash in data that can be hard to sort through and leverage for actionable insights. If you’re trying to establish or rethink your travel management KPIs, focus on the following 10 metrics.

10 Travel Management KPIs:

1. existing contracts.

Every year, Travel Managers should evaluate all existing contracts. Sometimes contracts are great for your company — they deliver locked-in, below-market rates. And sometimes contracts are not-so-great for your company — they keep you paying higher rates than what you could get through other suppliers and vendors.

Spend time annually assessing total travel spend under contract and the competitiveness of those contracts. Also, actively anticipate the expiration of contracts as an opportunity to re-up with the current vendor or to find a better deal with the competition.

If you wait until the last minute to think about expiring contracts, you may be tempted to stick with the status quo — even if that’s not what’s best for the bottom line. Keep in mind that your contracts will heavily influence several travel management KPIs, which is why it’s important to get them right.

2. Savings Negotiated

Make sure you’re able to quickly report the total amount your travel program is saving through negotiated rates. Then, break up those savings by vendor type. How much are your negotiated rates saving on air travel? On hotels? On car rentals?

Reporting total savings is a great way to demonstrate your travel program’s effectiveness. Breaking those savings down by vendor type allows you to find opportunities for improvement.

For example, you may find that you’re saving twice as much on hotels than on car rentals. When your car rental contracts are close to expiring, you can seek out a new vendor who can help you save at a rate closer to the one you get with your hotel vendors.

3. Spend Concentration (and Related ROI)

Break your company’s total travel spend into spending per department, per region, per country, per route, per city, etc. You may be surprised to find that the business is spending a disproportionate amount of money on traveling to one place.

That’s fine — as long as concentrated spending is delivering a strong ROI. If you find, though, that spending is overly focused on a single team or destination that isn’t delivering revenue, it’s time to reevaluate that investment.

4. Traveler Experience

Also keep in touch with your Travelers. It’s important to understand how team members are feeling before travel (planning, booking, approvals), during travel (vendors, trip disruptions, communication) and after travel (expenses). Your traveling employees are your best source for ideas on how to improve the travel program.

How should you stay in touch with them? Try a quarterly survey that helps you track sentiment. You can also hold a yearly training or travel town hall with ample question-and-answer time. Travel experience is one of the most important and most overlooked travel management KPIs.

5. Risk Management and Duty of Care

Your company should be able to live up to its duty of care obligation for every employee at any given time, no matter where your team members may be traveling. Risk management is a hot topic in the business travel industry, and executives will expect that travel managers have in place a plan to effectively manage risk when necessary.

The larger your company gets, the more outside help it may need on the risk management and duty of care fronts. If your company is traveling at scale, consider a third-party risk management/duty of care provider.

6. Booking Tool Adoption

Booking tools are designed to streamline processes, ensure compliance and deliver savings. How many of your travelers have adopted your company’s online booking tool ? This percentage will go a long way toward demonstrating the ROI your company is enjoying for its investment in travel technology.

7. Advanced Bookings

Last-minute travel happens. It’s a reality of doing business. But, for the most part, advanced bookings are preferred because they deliver more options and lower costs. What percentage of your company’s bookings fall outside the time frame requested in your travel policy? What are the reasons for these non-compliant bookings? And how can your travel program minimize these last-minute bookings in the future?

8. Travel Program Compliance

Travel programs and policies exist to help both travelers and the company. They are meant to make the travel management process easier while also saving the company money. But how often are your travelers making arrangements that conflict with your policies?

Do some travelers think they are saving money by booking outside of approved channels? Do they want to use a non-approved airline, hotel or car rental company? Is it simply that they are reluctant to use new travel technologies?

It’s important to get to the bottom of why your Travelers are making non-compliant arrangements. When they do, it undermines the goals of making travel management easier while also saving the company money.

9. Travel Re-Bookings

How many re-bookings do your traveling team members make? What are the reasons for those re-bookings? And how can re-bookings be avoided in the future?

Re-bookings are expensive, of course, and they should be avoided if and when possible. American, Delta and United all charge $200 for re-bookings of domestic flights. Evaluating re-bookings is also an opportunity to look at travel waivers available to your company — and to ensure that they are being used to minimize the impact of re-bookings.

10. Future Expansion Opportunities

If your team members are traveling at a global scale, you may find that it’s time to establish travel management services in specific countries. For example, if your company often sends team members to the United Kingdom, you may unlock significant savings by engaging a UK-based travel management company.

Look again at how your travel spend is concentrated geographically. If you’re spending a significant amount in any given country, assess opportunities to more formally expand your travel program to that country.

We Can Help With Travel Management KPIs

It’s not always easy to establish and track the right travel management KPIs for your company. At JTB Business Travel, we provide comprehensive travel management services to companies large and small — including spend management tools, travel technologies and more. Behind every service we provide is a common sense approach to business travel. Contact us today to learn more about how we can help with your KPIs.

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• The Importance of Ethical Sourcing in Travel Thinking about how your organization travels? A lot of sustainability buzzwords will arise: carbon accounting, ESG and, now, ethical sourcing. What does it mean, and why does it matter? Ethical sourcing is just one of the phrases you’ll hear bandied about as you first begin approaching your company’s sustainable business travel. What it means toRead […]
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Elevate Your Tourism Marketing KPIs

I often hear the term “holistic marketing” used interchangeably with something that seems like “spray-and-pray” marketing. Marketers are often pressured to be active everywhere in the hope that something is going to work.

Ironically, this type of overload prevents those marketers from reviewing – or doing anything with – the data to see which noodle actually sticks to the wall.

While you need an integrated approach, it doesn’t mean that you should do everything at once. Holistic marketing is based on the relationship between one channel or activity and another and improving the journey between those tactics.

Yes, you need to be active on the digital channels that matter. Team members should be present at the in-person events and locations that produce high ROI. You also need to quickly calculate your return often. At the same time, there are a lot of activities that don’t produce results, yet they persist “because everyone else is doing it”. Those activities need to stop, and this process will help you determine where those time-suckers are.

These steps below will help you channel your strength to where you need it, and prevent burnout from things that simply don’t matter.

Re-evaluate the Activities

Tourism marketing KPIs may vary from place to place. However, there is one that everyone counts: revenue . If you want to get true focus on your results, concentrate on the actions that improve visitor spend. Put revenue attribution at the core of your performance indicators.

Below is a handy matrix we use to achieve clarity on the KPIs that truly matter. You can use this formula for everything from tour marketing to conferences to social media channels.

Column Breakdown

Marketing Activity. In this column, you can name pretty much anything but it’s best to list things that are moderately specific. Don’t list an entire marketing category (tour operator outreach or your website). Instead, look at social media channels, types of content, etc.

Current ROI. Sure, measuring ROI is tough in any industry and the tourism sector is no exception. However, you can determine visitor traffic and click-throughs to other sites (hotels, museums, parks, etc.) in Google Analytics. Rate the ROI on a scale from 1-5 with 5 being the goal. This will be the most important determining factor in establishing tourism marketing KPIs.

The most important KPIs you have are the ones directly tied to revenue , like cost per visitor, cost per audience growth %, and so on. The measurement of likes, comments, and so on are indicators – they’re vanity metrics. Sure, they give you an idea of content popularity, but they’re not the goal. We see so many clients that rely on these “ vanity metrics” ; they can prove to be more of a distraction than anything else.

Growth Potential. Is this activity a growing online platform? Have you just started using it? Will it be a critical piece of an upcoming campaign? If so, rate it accordingly – the same way I mentioned above. If you don’t see much change coming from using the channel in the future, consider giving it a moderate to low score.

Automation Potential. There are some activities that we simply need to do, but they take up more time than they’re worth. Review the possibility of using a platform like Buffer or Hootsuite to schedule social media posts on lower-performing channels (I’m looking at you, Twitter).

Similarly, consider automation in your email marketing platform to greet and nurture new subscribers. MailChimp ‘s email automation is especially intuitive.

Final Score. Take the average of the preceding columns to give you a final rating of the activity. An activity of a score from 1-2 tells you it’s a time-waster that should be scrapped in favor of activities with 4-5 scores.

Cut the Fat

In the example above, you’ll see that the first activity isn’t performing currently. Its outlook for growth isn’t that great, but it can be automated. A final score of 3 tells you that it can go either way but it won’t produce significant ROI.

The second activity provides decent ROI now but the outlook is pretty rough and there’s no hope to automate any of it. This should definitely be scrapped.

The third activity is a prime driver of revenue that you can see sticking with for a long time. It can’t be automated but it still receives a high score. The recommendation for this activity would be to see how else it can be used to its potential.

Moving forward, pay attention to action vs. revenue. For example, if you want to grow hotel reservations, you need to look at the activities (website traffic growth) and divide that growth percentage by the number of outbound clicks from your website to hotel sites.

Remember, tourism marketing KPIs – just like other industries – rely on their impact on the bottom line.

HOW STRONG IS YOUR TOURISM BRAND? Get expert insight from our destination brand assessment!

Next, Audit Your Content

Next, you may want to optimize the content you publish.

As destinations, there is rarely a shortage of things to talk about on social, email, event calendars, TV/radio, third-party sites, etc. There are the events you host , events from partners and local businesses, team member spotlights, scenic photos, promotional campaigns – the list is seemingly endless.

However, not all of your content is hitting the mark. One post can generate 300+ likes on Instagram, followed by one with only 25. Facebook can be driving website traffic while Twitter is a ghost town. Take a look at your channel and content performance and determine the following:

• days and times of day produce the most engagement
• topics resonate the most with your audience
• content types perform better than others (outbound links vs. links to partner Facebook pages; video vs. image galleries, etc.)
• Performance of ads or boosted posts

Once again, our approach is more complex. We use a 14-step process in our content review that also covers search engine optimization, email audience list health/segmentation, and a ton of other factors. These four high-level areas can help you in narrowing down and concentrating on delivering content that resonates with your audience.

New Tourism Marketing KPIs

Now that you’ve reduced your activities to the ones that truly matter, and you rely on revenue-based KPIs, it’s time to bring in some that also reflect the health of your community. These are rare exceptions to the “revenue-only” principle but they’ll forecast future growth.

• Diversity-related metrics , which include periodic audits of your marketing materials, website, and social media content t make sure all audiences are represented. Promote to a larger, diverse audience and you’ll receive a larger, diverse audience.
• Civic pride, which can be reflected in community surveys, email marketing, and volunteer registration for events.
• Geolocation data from credit card reporting, Google Analytics, and practically every digital channel. Credit card reporting is particularly helpful since you can tie regions to revenue.
• Reflection of your mission and values. This is often referred to as being “on brand”, using messaging that reflects the values of your community. If verbal guidelines have been created for your brand, this almost manages itself. In that case, a quarterly review is all you need.

Finally, one that’s truly COVID-inspired:

• Couple visitor spending with hotel utilization . Don’t look at “heads in beds” alone since that doesn’t show the full picture of your visitation. We’re in a road trip economy for the next year at least, so keep an eye on visitor spending with merchants, restaurants, and attractions since many – if not most – of your visitors may only be there for the day.

Our audiences have changed dramatically over the past year or so. We need to refine and reconsider our tourism marketing KPIs if we want to impact revenue attribution and build a strong community.

No two destinations are the same.

We can help you solve your unique challenges. Schedule a call today.

Patrick King

Patrick is the Founder of Imagine and advisor to places on brand strategy and creative. His insights have been published in Inc. Magazine, SmartCEO, Washington Business Journal, The Washington Post, and Chief Marketer, among other publications, and shared at conferences throughout the US. He also has an amazing sock collection.

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• Handbook on Key Performance Indicators for Tourism Marketing Evaluation

The ETC/UNWTO Handbook on Key Performance Indicators for Tourism Marketing Evaluation presents a comprehensive overview of performance indicators for tourism marketing evaluation. It provides a framework for understanding contemporary marketing evaluation, how to measure results from marketing and promotional activities, and how to evaluate overall marketing effectiveness within the context of business or destination impacts. This handbook aims to be a user-friendly and accessible guide that provides a methodological framework and practical guidance on how to use performance indicators. Complemented with a number of case studies and best practice examples, the handbook offers both a theoretical and practical approach to guide national and destination management organizations towards better digital marketing evaluation.

ISBN : 978-92-844-1852-7

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The 7 most important KPIs for hotel industry

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KPIs for the hotel industry are values or metrics that measure the performance of a particular area of hotel operations – or the property as a whole. They ensure clear visibility on the functionality and sustainability of your business within the hospitality landscape.

KPIs allow you to analyze and develop significant improvements that will help to boost your property’s performance. Below, we’ll examine some of the most important KPIs for hotels that play a pivotal role in understanding and defining success within our industry.

Table of contents

What is the meaning of KPI?

A key performance indicator is a measurable value that illustrates how an organization or company is doing in relation to its set objectives, such as average room rate. A KPI often demonstrates how the targets are achieved using data and calculations that guide owners and managers to know how their business is performing.

Key performance indicators cover all aspects of the hotel industry, from financial management, operations, and all departments with measurable outcomes, such as marketing or front-of-house. It’s important to note that you have to select the KPI relevant to the specific sector you’re dealing with in order to find accurate data and metrics to improve performance.

Why is the data from KPIs important to track?

Any industry should have a good record of previous performance and success. The hospitality sector isn’t an exception, and it’s KPI data that’s one of the biggest helps when it comes to analyzing and evaluating hotel performance.

Keeping track of KPI data allows hotel owners to make effective decisions based on previous performance. Being able to compare past findings provides a clear view of the hotel's progress. Furthermore, the hotel data analytics allows the business to identify the number of factors that affect its performance.

What are the most important KPIs for the hotel industry?

By now, it should be obvious that there’s a real need to identify the most prescient key performance indicators and how they assess the hotel industry. Here are some of the top KPIs for hotels, and how you can measure them to drive your own business decisions.

Average daily rate (ADR)

This is one of the topmost metrics that’s used to measure the average rate per occupied room . This means you can examine the average amount of revenue collected daily for all of your rooms that are occupied. ADR always excludes unoccupied rooms to prevent unrepresentative figures.

This KPI will enable you to measure a key element in the financial performance of your hotel. ADR also plays a significant role in forecasting pricing and marketing. This allows management to plan and work with flexible prices, depending on the seasons.

Here’s the calculation:

ADR = room revenue / number of rooms sold (occupied)

Revenue per available room (RevPAR)

This is the measure used to analyze the average revenue for a certain period of time (usually given as a daily average), based on your income across all bookings. To calculate this KPI, you have to multiply the average daily rate by the occupancy rate. Another option is dividing the total revenue per night by the number of rooms available.

RevPAR creates a price metric for how much revenue is being generated per room. A high RevPAR typically means a good occupancy rate as well as a high ADR.

RevPAR = average daily rate x occupancy rate or total revenue from night / total number of rooms available

Average length of stay (ALOS)

This is a measure used to determine the occupant’s length of stay by dividing the total number of occupied rooms by the number of bookings. It’s important to note that the occupied spaces are counted in terms of the number of nights the guests stay at the hotel.

The final score represents the average length of stay of your clients in your hotel . A higher score normally is a better indicator than a lower score, as it’s an indicator of higher overall spend.

An advantage to ALOS is that you can use the data to make pricing decisions. For example, if you have a low ALOS, you could increase your room rate for short stays or offer better deals for longer stays. The length of stay is a big variable in affecting the revenue for the hotel.

ALOS = total occupied room nights / number of bookings

Occupancy rate

For occupancy rate, you can track the results daily, weekly, monthly, or annually. This metric involves identifying the total number of rooms, the empty rooms, and the booked ones.

You can divide occupied rooms by the total number of rooms available and multiply by 100 to get the occupancy rate. This KPI is important in evaluating your hotel’s daily performance , giving you a constant flow of data. If you notice low occupancy trends on certain days of the week, you can run promotions to encourage more bookings on these days, or alternatively streamline your staff if not everyone is needed.

Occupancy rate = total number of occupied rooms / total number of available rooms x 100

Online reviews

In this era where everyone can access the Internet and share our experiences about a hotel, it’s essential to take a look at the reviews. Star ratings being left by clients can indicate how efficiently the hotel is operating and which areas improvements can be made.

By following ratings and reviews, hoteliers can make changes accordingly to increase customer satisfaction and as a result, attract new clients.

RevPAR Room Type Index (ReRTI)

Because of the changing hospitality landscape over the last year, a new metric has emerged to help revenue managers determine whether the sale of higher value rooms contributes proportionally to the inventory of each room type to the RevPAR.

The main aim of ReRTI is to analyze which room types are the most profitable , and assess whether promotions like free room upgrade can help or hinder a hotel. If the room type scores higher than 1, it means that the room type contributes proportionally more than it should based on the number of rooms you have of that type. If the score is less than 1, it means that that room type is contributing proportionally less than you’d expect.

RevPar Room Type Index = % total RevPAR x number of specific room type / % inventory x number of specific room type

Market penetration index (MPI)

MPI is an important metric when measuring KPIs. This shows your hotel performance with respect to your competitors in terms of industry.

If your score is less than 100, then it means you are doing poorly and under the market average. On the other hand, if your score is more than 100, it shows that you’re performing better than most of your competitors.

MPI = hotel occupancy % / market occupancy % x 100

Understanding the hotel industry's new metrics is important as it allows business owners to track their hotel's performance. Additionally, to strengthen customer service, increase sales and profits, it’s important to identify and select the correct hotel KPIs.

Once you’ve identified them, make sure you keep tracking them and analyzing them regularly. These metrics will give you a strong base from which to make business decisions and achieve success in the hospitality industry.

KPIs for the modern hotelier

The metrics we've just explored are among the most common in hospitality, but that doesn't mean they're the best. We've put together a report,  Metrics that Matter , that will help you to maximize revenue and boost the guest experience, all by tracking the right data. Click the button below to find out how you can be more efficient across operations, revenue and marketing:

When Tom isn't creating outstanding marketing content for Mews, he writes fiction for himself. Either way, he only uses the best words.

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Five important KPI’s for travel agents and what they help you measure.

Closing monitoring key financial key performance indicators  KPI is a an important part of managing any business, but given the high number of variables in the travel industry, being able to quickly drill down into profit and loss drivers becomes critical to diagnosing problems and improving the business bottom line.

If a travel business isn’t hitting its profit targets we have to ask the right questions to understand why. Is it a price issue – are you discounting too much too often? Is the price holding up but volume has fallen?  Is one destination or package type  profitable but others are letting you down? How long does it take you to on-board new travel consultants and see them generate results? Do you have poor efficiency in key areas due to a lack of technology or skills gaps in your team?

The specific metrics needed are different for every business depending on the area of travel you specialise in, but here are some good places to start.

We work alongside many clients to establish meaningful KPI’s to help them better manage their business for improved profitability . In most businesses, carefully measuring ‘activity’ metrics soon shows where there may a problem or an untapped opportunity. Activity based cost reports are very useful to clients because when a business owner truly understands all the costs of delivering product or services and how those costs differ across divisions or service types it becomes a powerful tool for managing and improving financial performance.

If this isn’t the way your company thinks about financial reports today it could well be worth making the change. Give our team a call to discuss how KPI’s and activity based reporting could help your business become more profitable.

Original Post: mitchellwilson