GITNUX MARKETDATA REPORT 2023
Must-Know Hotel Performance Metrics
Highlights: The Most Important Hotel Performance Metrics
- 1. Occupancy Rate
- 2. Average Daily Rate (ADR)
- 3. Revenue per Available Room (RevPAR)
- 4. Average Length of Stay (ALOS)
- 5. Guest Satisfaction Index (GSI)
- 6. Customer Acquisition Cost (CAC)
- 7. Customer Retention Rate (CRR)
- 8. Total Revenue per Available Room (TRevPAR)
- 9. Revenue Generation Index (RGI)
- 10. Gross Operating Profit per Available Room (GOPPAR)
- 11. Direct Booking Rate
- 12. Market Penetration Index (MPI)
- 13. Employee Turnover Rate
- 14. Net Promoter Score (NPS)
- 15. Cost per Occupied Room (CPOR)
Table of Contents
Hotel Performance Metrics: Our Guide
The success of any hotel largely depends on a deep understanding and insightful analysis of its performance metrics. In this modern era of intense competition in the hospitality sector, it’s more crucial than ever to leverage the right metrics to ensure prosperity. This blog post, based on a recent in-depth study, aims to guide you through the must-know hotel performance metrics that can pave your way to sustainable growth and success.
Measures the percentage of available rooms that are occupied during a specific period. A higher rate indicates higher demand for the hotel rooms.
Average Daily Rate
Calculates the average room revenue per occupied room per day. It helps to understand the hotel’s pricing strategy and effectiveness in revenue generation.
Revenue Per Available Room
A metric combining occupancy rate and ADR to gauge overall room revenue efficiency, assessing rate and occupancy optimization in hotels.
Average Length Of Stay
Measures the average number of nights a guest stays in the hotel. A higher ALOS indicates higher guest satisfaction and may lead to lower operational costs per booking.
Guest Satisfaction Index
Overall guest satisfaction assessment from surveys, reviews, and social media. Higher GSI score equals better experience and can enhance reputation and bookings.
Customer Acquisition Cost
Calculates the average marketing and sales expenses for acquiring one new customer. Lower CAC indicates a more cost- effective marketing strategy.
Customer Retention Rate
The percentage of returning guests over a specific period. A higher CRR signifies better customer loyalty and satisfaction, contributing to long-term success.
Total Revenue Per Available Room
Similar to RevPAR, but also includes non-room revenue sources such as food & beverage, spa, and other facilities. It provides a holistic view of a hotel’s overall revenue generation.
Revenue Generation Index
Compares the hotel’s RevPAR with the average RevPAR of competing hotels in the market. An RGI above 1 indicates the hotel is outperforming its competition.
Gross Operating Profit Per Available Room
Calculates the profit generated per available room after accounting for operational expenses. A higher GOPPAR indicates better cost control and management efficiency.
Direct Booking Rate
Percentage of direct bookings on the hotel’s website or call center. Higher rates save on commissions and boost profitability.
Market Penetration Index
Compares a hotel’s occupancy to competitors. MPI above 1 means gaining market share.
Employee Turnover Rate
The percentage of employees who leave the hotel within a specified period. Lower turnover rates indicate better job satisfaction and lower hiring and training costs.
Net Promoter Score
Guest loyalty measure based on likelihood to recommend. Higher NPS = stronger loyalty and more referrals.
Cost Per Occupied Room
Average cost per occupied room, including operations and maintenance. Lower CPOR indicates efficient resource management.
Frequently Asked Questions
What are hotel performance metrics and why are they important?
What are the most widely-used hotel performance metrics?
How can revenue management strategies affect hotel performance metrics?
How can hoteliers improve their hotel performance metrics through guest satisfaction?
How do hotel performance metrics contribute to competitiveness in the hospitality industry?
How we write these articles
We have not conducted any studies ourselves. Our article provides a summary of all the statistics and studies available at the time of writing. We are solely presenting a summary, not expressing our own opinion. We have collected all statistics within our internal database. In some cases, we use Artificial Intelligence for formulating the statistics. The articles are updated regularly. See our Editorial Guidelines.