6 Key Performance Indicators for Hotels
• July 17, 2025 
- Tracking the right hotel KPIs, i.e., ADR, RevPAR, occupancy, guest satisfaction, return stays, helps optimise revenue, marketing, and operations
- Metrics fall into revenue (ADR, RevPAR, occupancy), guest engagement (NPS, WiFi signups, repeat visits), marketing (direct bookings, channel attribution), and operations (cost per occupied room, booking cancellation rate)
- Hotels can improve performance by monitoring dashboard data, benchmarking against similar properties, and adjusting strategies accordingly
What gets measured gets done – an old adage that is more relevant today than it ever has been. Managing a successful hotel has to be one of the most challenging jobs due to the sheer volume of responsibilities required. With so many departments and so many people that you have responsible for it can be very difficult to find the time to review your performance. Key Performance Indicators for hotels are select measurements that really matter for lasting success and we examine a few of the most important ones below.
Online Rating
It is very much in your interest to get as many online reviews as possible – good and bad. Reviews are not only valuable in the way that guests select hotels based on the quality of the review, but they are also useful critical feedback that you can base improvements on. Negative reviews while having an initial negative impact give you the opportunity to take corrective action so that the next time the review will be better.
Occupancy %
The most critical and simplest measure of performance for hotels in the occupancy rate. Measured as the percentage of available rooms occupied over a specific period of time.
Occupancy % = Rooms Occupied / Rooms Available
ADR – Average Daily Rate
Measured simply as the average price paid per room on a given day. Works well in isolation as an ongoing performance metric.The ADR is most useful when compared to previous periods or seasons to identify performance.
Average Daily Rate = Total Room Revenue / Total Rooms Occupied
REVPAR – Revenue Per Available Room
REVPAR is a very useful measure of performance and it is also one that needs to viewed in the correct context. Measured by the average daily room revenue generated by available room, it can differ significantly based on industry specific factors
REVPAR = Total Room Revenue / Total Rooms Available
Customer Satisfaction
It may be more of a challenge to measure but without satisfied customers you will find it difficult to challenge for business against competitors, especially when online ratings are the currency of choice for potential guests. It is possible to develop a process with which to measure customer satisfaction and you can incrementally improve your offering over time based on the results.
Advertising ROI
Calculating your Return on Investment (ROI) from your advertising and promotions will save you from wasting money on ineffective advertising and promotion. How much revenue does you local city magazine ad bring hotel? Maybe lots, maybe little – either way you need to know and you need to track and measure it. With online advertising this task should be somewhat easier but make sure you have your systems set up in your hotel so that you can measure the effectiveness of you advertising spend.
Key Performance Indicators for Hotels
These are only a few metrics out of many that can be applied to your business but we feel they are the most relevant in the current age of connected customers. Measuring your performance is only the first and easiest part of the continual improvement process but without knowledge there can be no purposeful action.
Hotel KPIs – FAQ
Which hotel KPIs matter most?
Start with ADR, occupancy, RevPAR for revenue, then layer in satisfaction and marketing ROI for a complete view.
How can hotels measure engagement via WiFi?
Track guest WiFi signups and follow-up email open rates to gauge interest and engagement levels.
Why track repeat visits?
Repeat stay rates show how well you retain guests and build loyalty over time.
What’s a good NPS for hotels?
Scores above 30 are considered strong, industry leaders often achieve 50–70.
How do you benchmark KPIs?
Compare against similar sized properties in the same market, use industry reports or analytics dashboards, then optimise accordingly.
