Sponsored by Generali Global Assistance
Having a handle on the key metrics of your business helps you gauge performance, plan ahead, and keep your financials where you want them. Insights into your business data can also tell you a little bit about your guests: who they are, what they want, and how to make them happy. When it comes to travel insurance, we know that different guests purchase coverage for different reasons, so explaining the benefits isn’t always a one-size-fits-all approach. Here, we look at a few of your business’s most important data points and what they can tell you about your uninsured customers.
Average Daily Rate (ADR)
With average daily rates generally up year over year, and up significantly relative to 2019, travelers are potentially spending more than in years’ past. Take higher reservation costs along with inflation, and travel in general might be looking a little more expensive. The more a guest is investing in their vacation, the higher the risk of losing that investment. This is where travel insurance comes in and can be an important part of the trip planning process.
How far out guests are booking their stays can tell you a lot about your customers. Knowing your average booking window can help you anticipate the future, keep your rates competitive, and know when to make adjustments. A guest’s booking window is also an important indicator of your guests who can benefit from getting travel insurance. Similar to higher trip costs, longer booking windows equate to higher risk for your guests. The more time between putting down their initial deposit and arriving at the rental, the more likely something might go wrong that could result in a cancellation.
With supply on the post-pandemic rebound, occupancy has been down year over year in recent months, and even dropped just below 2020’s rate. When you’re looking at lower occupancy rates, rebooking a last-minute cancellation can be a little more challenging than times when demand is outpacing supply. Travel insurance can be a big help here, not only for your guests but for you. If you can’t rebook the property in time, you don’t have to worry so much. You can hold on to your revenue, your guest can seek reimbursement from their travel insurance plan, and everyone wins out.
As supply increases, demand is still going strong, and small city/rural destinations have been growing the most. According to AirDNA, strength in these markets can be attributed to travelers’ “desire to get closer to nature and take more trips to destinations close to mountains, rivers, and national parks.” Great for travelers and great for these markets, outdoorsy trips can also be more risky for guests. No one expects to take a tumble down a mountain, but it happens all the time. Travel insurance can help with medical evacuations and other medical expenses, wherever your guests find themselves.
Revenue per Available Rental (RevPAR)
With ADR growth starting to slow and down in some markets, you might be wondering how to keep your revenue up, especially if your market is also experiencing lower occupancy levels. Adding extra income to your bottom line is a simple way to do that, and offering travel insurance is an easy way to add an auxiliary revenue stream. The guest receives coverage and peace of mind, and you make a commission on each purchase, simple as that. So, whatever economic uncertainties may come along, you have another way to keep growing.
Attending the 2022 VRMA International Conference? Get more insights about how you can leverage guest data to grow your business at our Lunch & Learn. On Monday, October 24 at 12:45 p.m., we’re presenting How to Proactively Manage Risk with Data-Driven Problem Solving along with Key Data. Join us for a walkthrough of Key Data’s new travel insurance dashboard, our Vacation Rental Toolbox, and the ways that you can use both of these free tools to earn more. For a head start, sign up for the Key Data Dashboard and get started with Generali Global Assistance today.
George Meshkov is the vice president of travel insurance sales at Generali Global Assistance.