Stay Ahead With our Top 4 Tourism KPIs
Posted on 27th July 2017 in KPIs
Written by Freya Hughes
The tourism industry is an incredibly broad one. It’s your job to keep a handle on the incomings and outgoings of your business, especially in peak seasons. You need to focus on keeping your team in check and ensuring customers have an experience to remember, so we’ve summed up the top four KPIs for you to measure in your business, so you can work on your reputation.
With an abundance of various offerings, the tourism industry can be a challenging one to be in. You must ensure you keep your standards high to make sure customers return, and with many different offerings, it can be hard.
We spoke to our client, Crystal Castle, a tourism site based in Australia, recently, whose owner Naren King discussed how measuring his KPIs has allowed him to live remotely on the beaches of Bali while his business sees sustainable growth. With three main revenue streams, Naren is able to log in to FUTRLI and get a great understanding of his business’ and staff’s performances at a glance. Read the full case study here.
For now, however, let’s explore the main KPIs to be measuring in your tourism business to keep the crowds flocking in.
While you’re here, be sure to check out our KPI Library – a fully stocked metric haven. We also have other industry-specific KPI lists to help you understand the crucial parts of any business.
A crucial one in tourism, 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. With sites such as TripAdvisor and Yelp, it’s key to get your offerings right.
Reputation is more important now more than ever, as existing and future customers can view opinions on you and your business at the click of a button. Always ask for feedback – it could easily prevent you repeating mistakes or from making them in the first place. Your customers are your revenue, so make sure your reputation is as good as it can be. Find out how to calculate your customer satisfaction rate here.
Number of visitors in a given time period vs transactions
This is crucial to measure, as it’ll reflect your ticket sales, which will also predict any retail transactions. You can measure this via your admission sales, though if that’s inapplicable for your business, don’t you worry.
When looking at retail KPIs, we learnt that new tech will allow you to measure how many people enter your premises. Attempts at a WiFi connection is the way some high street stores are counting how many customers pass through their doors in the UK, says The Telegraph. Cross reference this figure against your financial reports to see if you need to up your marketing game. This KPI will show you how attractive your business is. Put this information into a forecast to ensure you’re on the path to success in the future.
Now they’re in, they need to get purchasing. Tracking how many people enter against your sales will show you areas that need attention. As we saw with Crystal Castle, Naren’s three revenue streams are visitor numbers, cafe revenue and retail sales. As you’ll see, the former influences the two latter streams. You need to aim to get your visitors buying refreshments and merchandise to up your revenue.
This metric will show you how many employees joined or left your business in a given period. If your rate is high, you need to look at why. In normal operating conditions, you can measure this KPI to identify any problems with staff retention. If staff aren’t sticking, you need to look at why. Are managers difficult to work under? Is the pay you’re offering not competitive enough? Are your staff overworked? 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.
If staff are staying for years at a time, you’ve probably got nothing to worry about. It is advisable, however, to keep your loyal staff on their toes, just in case they become complacent. Learn to calculate your staff turnover KPI here.
Total revenue per available room
This is only applicable if you offer stay-overs, of course. Tracking your total revenue per available room highlights how much revenue your business is generating per available room. This is calculated using total income from all sources rather than just that earned by each room. With all the other sales you’re making across your company, this is likely to be your biggest hitter in terms of revenue.
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. If it’s too low, you’ll probably have a high number of visitors, but not feel the benefits of it. Conversely, if you’re overcharging, you may see some empty rooms when each should be booked out. Find out how to measure your total revenue per available room here.