Your Environmental Policy, An Untapped Asset (Part II)
By Tyler Tatum Marketing Strategy Consultant, | August 25, 2010
In the first part of this series, we helped you create a document outlining your environmental policy, which you and your team can use as a point of reference for direction as well as articulating your efforts to guests. In tracking your savings, it will be important to reference this document in order to better understand the source of the savings. For example, if your property is experiencing a large reduction in water usage, but your environment policy identifies no efforts related to water reduction; your team is clearly missing some important information. Either you have forgotten to include key water saving initiatives your property has implemented, or some other factor has changed.
You may notice the use the singular term "property" instead of plural term "properties". Due to differences in environmental conditions, clientele, individual property occupancy, and other related factors, it is important to look at the impact of your environmental policy at the level of each individual property. For those who have multiple properties, you can sum your overall efforts; however, ignoring the individual property differences may cause you to make global decisions without vital information. For example, in a hotel next to a national park, guests may be highly sensitized to environmental issues such that your overall impact may be less than a property implementing changes in the middle of New York City.
Referencing how you are marketing your environmental efforts will become important information in tracking and understanding the overall impact of your efforts on metrics such as sales and guests satisfaction. Without a clear understanding of the changes you are making in your behaviors, you will have a hard time understanding the metrics representing the results of your changes. For example, you will have to include any changes in your sales and marketing efforts in your interpretation of your sales figures.
Once you have created your environmental policy, there are three key metrics in assessing the impact of your environment policy. 1) Understanding your performance prior to implementing changes, 2) estimating the impact of your property's efforts, and 3) matching your estimates to your actual. In reviewing these three metrics, each must be broken into two main categories: overall impact on sales (or heads in beds) and overall impact on operations.
First, we will investigate how to measure and track your policy's impact on sales. In order to understand your past revenue performance, it will be important to retrieve the last twelve months of revenue per available room (Rev PAR) data, as well as the overall occupancy rates. Take these numbers and plot them on a graph (this is easy to do using Excel or just a sheet of paper). Mark where your hotel had lower or higher occupancy during the year. Identify your Rev PAR and occupancy for the year, and draw these numbers on the graph.
Next, use your understanding of how you are marketing your environmental policy to help you identify what the impact on overall sales might be. For example, assume you ran an ad including your environmental efforts in the local media, and 10% of your guests come from the local community. A doubling of traffic from your advertising efforts would only increase occupancy rates by approximately 10%. In looking at future performance, it will be important to use this information in order to understand if any change did occur. If you are marketing through any of the environmental organizations such as the Coalition for Environmentally Responsible Economies (CERES) or the Environment Protection Agency's Energy Star program, call them and ask how other hotels have been effected from there efforts.