What is the Direct Booking IndexTM (DBI) and why should all hotel brands be tracking it?

As our industry strives for recovery, it’s becoming even more critical for hotel brands to build a strong direct channel strategy that guarantees long-term success. In terms of benchmarking metrics for hotels, however, there has been little focus on the direct channel, despite its growing importance in the industry.

Hoteliers have long seen the benefits of monitoring their hotel performance through metrics and KPIs, from RevPAR and ADR (Average Daily Rate) to MPI (Market Penetration Index) and LOS (Average Length of Stay). More than a simple website conversion rate, these are very often bespoke metrics specific to the hospitality industry, adding to their relevance and usefulness.

As a hotelier, you’ve probably already spent long hours developing a direct channel strategy that suits your brand’s objectives, needs and game plan; but are you able to tell how effective it is compared to the market?

With the Direct Booking Index™ (DBI), now you can. This brand new industry metric was developed by The Hotels Network (THN) as a key component of the company’s latest product innovation BenchDirect – the first benchmarking platform for the hotel’s direct booking channel.

The Direct Booking Index™(DBI)

So, what exactly is it? The Direct Booking Index™ (DBI) is an all-encompassing direct channel performance score for an individual hotel, group of hotels or chain, based on direct channel data taken from the market. It assesses the different building blocks involved in an effective direct channel strategy so you can track over time the evolution of your overall performance versus the market.

Based on data collected from a global network of 7,000+ hotels, the DBI™ is accessible exclusively to hotels who create a BenchDirect account, which is free for hotels forever. The insights are already being used by thousands of hotels worldwide as a benchmark for their direct channel strategy efforts.

The science behind the Direct Booking Index™

Now, how does DBI™ work? The score is calculated on a daily basis, using data from the past 30 days, and in addition, hotels can track its evolution on a monthly basis within a summary graph. Ratings range from 0-100 points, 100 being the highest-achievable score. So if your hotel achieves a score of 72 for example, it indicates that in terms of your direct booking channel, your hotel is performing better than 72% of other similar hotels within the network. This measurement takes into account the relative position and order of a hotel compared to its compsets, both in its destination and globally.

The BenchDirect platform compares hotel performance to multiple dynamic competitive sets across more than 30 key metrics, including website and booking engine traffic, bookings and pickup, future demand, rates and disparities, user profile and behavior. The DBI™ is calculated using a proprietary algorithm that takes into account your hotel’s performance across the most relevant of these metrics to provide you with an overall picture of how your direct channel is performing compared to the market.

Why does your DBI™ matter?

As mentioned earlier, hoteliers are used to tracking KPIs, and in particular compared to the market and the competition, to recognise the key areas that require the most focus. Using the DBITM to track how effective your hotel’s direct channel strategy is will encourage brands to give this much-needed focus to their direct channel and allocate the necessary attention to finding ways to generate additional direct revenue.

As its evolution can be tracked over time, the DBITM can even be used to set objectives for digital marketing or revenue teams to aspire to. By comparing your direct channel performance to the market, you can learn from the best and realize what heights can be reached, in turn raising the bar for your own brand.

BenchDirect is currently available; and completely free to use. Hotels can sign up today on the THN website to request an account to start benchmarking their DBITM, as well as a whole host of other key metrics that break down the full booking funnel, so you can pinpoint at a granular level how to boost your direct bookings.

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