Hotel owners wear many hats throughout their day-to-day. From managing operations and finances to overseeing the overall guest experience, it can feel like you’re stretched thin, throwing everything you have into the success of your property. And when you put that much work and passion into your hotel, it’s only natural to want to see and evaluate the fruits of your labour.
This is where understanding hotel KPIs becomes so important.
There are several ways to measure the success of various hotel functions. From how efficiently your operations run to how much revenue each room generates, there are dozens of metrics that can reflect both the quality of the guest experience and the effectiveness of your property as a business investment. These are known as your key performance indicators.
In this post, we’ll break down the top 18 hotel KPIs you should be tracking, along with a few tips on how to start optimizing your property’s performance and reach new milestones in efficiency and growth.
What Are Hotel KPIs and Why Do They Matter?
Hotel KPIs, or Key Performance Indicators, are measurable values that help you evaluate your property’s performance in key areas like revenue, operations, staffing, and guest satisfaction. Instead of relying on guesswork or gut feeling, KPIs offer concrete data that reflects the health of your business and helps you make informed decisions.
Tracking the right KPIs provides hotel owners with the context to analyze what’s working, what needs improvement, and where there are opportunities to boost business operations. Whether the target is to increase bookings, reduce operating costs, or improve online reputation, KPIs give you the insight needed to make data-driven decisions that yield real results.
Types of Hotel Key Performance Indicators
Hotel owners can use dozens of KPIs to evaluate their business performance. But just as hoteliers are required to wear several hats, there are different KPIs for each segment of hotel operations. Most can be broken down into five basic categories that reflect the core responsibilities of managing a hospitality business.
- Operational KPIs – Track occupancy, staff performance, and overall efficiency
- Financial KPIs – Measure revenue, profit margins, and cost control
- Revenue Optimization KPIs – Focus on pricing strategy, income sources, and distribution
- Guest Experience KPIs – Reflect guest satisfaction, loyalty, and feedback
- Competitive Positioning KPIs – Compare your performance to similar properties in your market
The key to successful, data-driven operations is analyzing these five segments. A mix of these KPI types gives you a more complete picture of your hotel’s performance—and helps you make smarter decisions as you grow.
The Most Important Hotel KPIs to Track
1. Occupancy Rate
Occupancy rate shows how many of your available rooms are being booked over a given period. It’s one of the most basic but important hotel KPIs, giving you a quick snapshot of how well your property is filling rooms.
The formula is simple: (Occupied Rooms ÷ Available Rooms) × 100.
Tracking this over time and comparing it to the local market can help you spot seasonal trends, adjust pricing, and improve marketing strategies to stay competitive and increase room revenue.
2. Average Length of Stay (ALOS)
ALOS measures the average number of nights guests stay at your property. It’s a valuable KPI for understanding guest behaviour, improving operational efficiency, and maximizing revenue opportunities.
The formula is: Total Occupied Room Nights ÷ Number of Bookings.
Longer stays tend to reduce turnover costs like housekeeping and staffing while also opening the door to deeper guest relationships and higher per-stay spending. Tracking ALOS helps you identify trends and adjust your promotions or minimum stay policies to attract more valuable bookings.
3. Average Daily Rate (ADR)
ADR tells you how much revenue you’re earning, on average, for every room sold. It’s a direct reflection of your pricing strategy and one of the most closely watched revenue metrics in hospitality.
To calculate it: Total Room Revenue ÷ Number of Rooms Sold.
A healthy ADR means you’re pricing your rooms in line with their perceived value. If it’s low, you might be undervaluing your offering. If it’s too high compared to similar hotels, you could be pricing guests out. Use it alongside occupancy and compset data to strike the right balance.
4. Revenue Per Available Room (RevPAR)
RevPAR blends occupancy and ADR to show how much revenue you’re generating from all your available rooms—not just the ones that are sold. It gives you a more complete picture of how efficiently your inventory is performing.
The formula is: ADR × Occupancy Rate or Total Room Revenue ÷ Total Available Rooms.
Because it accounts for both pricing and demand, RevPAR is one of the best ways to measure revenue performance over time. It’s also a great metric to benchmark against competitors in your market.
5. Gross Operating Profit Per Available Room (GOPPAR)
GOPPAR measures how much profit your property is making after operating expenses, on a per-room basis. Unlike RevPAR, which focuses on revenue alone, GOPPAR takes into account what’s left after the bills are paid.
The formula is: Gross Operating Profit ÷ Available Room Nights.
This KPI is key for understanding the financial health of your hotel. It helps highlight how well you’re managing expenses and converting revenue into profit—giving you a clearer picture of long-term sustainability and business performance.
6. Total Revenue Per Available Room (RevPAR)
TRevPAR looks at the big picture. It shows how much total income you bring in from all sources—not just room sales, but also outlets like your restaurant, spa, or event spaces.
The formula is: Total Revenue ÷ Available Rooms.
It’s especially useful for full-service hotels and resorts that have multiple revenue streams. Tracking this helps you see how each department contributes to overall performance and where you may be missing out on extra revenue opportunities.
7. Net Revenue Per Available Room (NRevPAR)
NRevPAR is a more refined version of RevPAR. It measures how much revenue you actually keep after factoring in distribution costs like OTA commissions, credit card fees, and third-party booking expenses.
To calculate it: (Room Revenue – Distribution Costs) ÷ Available Rooms.
This KPI gives a more realistic view of profitability per room and helps you evaluate how effective your distribution strategy really is. If you rely heavily on expensive channels, your RevPAR might look fine—but your NRevPAR could tell a different story.
8. Profit Per Available Room (PROFPAR)
PROFPAR looks at how much actual profit you’re generating per available room after all expenses are taken into account. It’s one of the clearest ways to understand the true bottom-line performance of your property.
Formula: (Total Revenue – Total Operating Expenses) ÷ Total Available Rooms
This metric helps you compare profitability across different time periods, room types, or even multiple properties in your portfolio. If you’re looking for a KPI that reflects revenue and cost control, PROFPAR is one to watch.
9. Cost Per Occupied Room (CPOR)
CPOR calculates the average cost of servicing a room that’s been sold. This includes things like cleaning, amenities, utilities, and other day-to-day operating costs directly tied to guest stays.
Formula: Total Costs of Room Operations ÷ Rooms Sold
Keeping a close eye on CPOR can help you spot rising expenses before they start cutting into profit. Lowering CPOR through energy-efficient upgrades, better housekeeping workflows or tighter inventory control can significantly impact your margins.
10. Labour Costs as a Percentage of Sales
Labour is one of the most significant operating expenses in the hotel business, which is why this KPI is so important. It compares your total labour costs to your total revenue to help ensure your staffing levels match business demand.
Formula: (Total Labor Costs ÷ Total Revenue) × 100
If labour costs are too high, it could be a sign of overstaffing or scheduling inefficiencies. On the flip side, being understaffed can hurt service quality. Tracking this ratio helps you find the right balance and make smarter scheduling decisions.
11. Employee Turnover Rate
Turnover rate measures how frequently your staff is leaving and being replaced. In 2021, turnover in the hospitality industry hit 84.9%—a statistic showing how costly this issue can be.
Formula: (Number of Departures ÷ Average Number of Employees) × 100
High turnover drives training costs, lowers team productivity, and impacts the overall guest experience. Reducing it can lead to better service, stronger team morale, and a more stable operation. It’s a key metric for long-term performance and staff satisfaction.
12. Cost of Acquisition (COA)
COA tracks how much you’re spending to bring in each new guest. This includes marketing costs, OTA commissions, advertising spending, and other sales-related expenses.
Formula: (Total Sales and Marketing Costs ÷ Number of New Customers Acquired)
While it’s easy to focus on revenue, keeping acquisition costs under control is key to long-term profitability. Tracking COA helps you understand which channels are delivering the best return—and where you might be overpaying to win bookings.
13. Sales Conversion Rate
Sales conversion rate shows how many of your inquiries or leads are actually turning into bookings. It’s an excellent metric for evaluating how well your website, booking engine, or sales team is performing.
Formula: (Bookings ÷ Inquiries) × 100
A low conversion rate might signal friction in your user journey or gaps in your response process. Optimizing this KPI can lead to more confirmed bookings without having to increase traffic or marketing spend.
14. Customer Satisfaction Score (CSAT)
CSAT gives a quick snapshot of how happy guests are with their stay. It usually comes from a post-stay survey asking guests to rate their experience on a scale—typically 1 to 5.
Formula: (Number of Positive Responses ÷ Total Responses) × 100
You can use CSAT to track satisfaction with specific touchpoints like check-in, housekeeping, or dining. The real value comes from spotting patterns and using that feedback to improve operations where it matters most.
15. Online Ratings and Reviews
Online reviews act as public proof of how your hotel is performing. Guests turn to platforms like TripAdvisor, Google, and OTAs to help make booking decisions so your review score can directly impact your revenue.
They also give insight into how efficiently your hotel operates—good reviews often reflect smooth check-ins, clean rooms, and friendly service. Monitoring, responding to, and learning from reviews is essential for reputation management and ongoing improvement.
16. Loyalty Program Engagement
This KPI measures how actively guests are participating in your loyalty program—through repeat bookings, point redemptions, tier upgrades, and more. It’s a strong indicator of guest satisfaction and brand trust.
Tracking loyalty engagement helps you see how well your program is working and which perks or experiences drive repeat business. A high Net Promoter Score (NPS) often goes hand-in-hand with loyalty, showing that your most loyal guests are also your biggest advocates.
17. Market Penetration Index (MPI)
MPI compares your occupancy rate to your competitors, helping you measure your market share and see if you’re getting your fair slice of business in your local area.
Formula: (Your Occupancy ÷ Market Occupancy) × 100
An MPI over 100 means you’re outperforming the competition; under 100 means you’re falling behind. It’s a solid metric for competitive benchmarking and identifying whether your pricing, distribution, or marketing strategies are pulling their weight in your market.
18. RevPAR Room Type Index (ReRTI)
ReRTI lets you see how each room type is performing compared to your overall room revenue. It’s especially useful for understanding pricing power across your different categories—standard rooms vs. suites, for example.
Formula: (Room Type RevPAR ÷ Overall RevPAR) × 100 (or × 200 depending on your model)
If a specific room type is underperforming, it might need a pricing adjustment or a refresh in its promotion. ReRTI is an excellent tool for revenue managers looking to fine-tune pricing and upsell strategies.
How to Effectively Track and Analyze Hotel KPIs
Once you know which KPIs matter most to your property, the next step is tracking them—and doing it in a way that gives you valuable, real-time insight. That’s where your hotel tech stack comes in.
Tools like your PMS, RMS, CRM, and dashboard software can pull data from all corners of your operation. They help you track performance as it’s happening, spot trends early, and get ahead of any issues before they snowball.
With the proper setup, you can make faster, smarter decisions—whether adjusting pricing on the fly, forecasting demand, or just checking in on how your team and revenue are doing weekly. It takes much of the guesswork out of hotel management and keeps you focused on what’s moving the needle.
Make The Right Marketing Decisions with Kurt’sCopy
Tracking KPIs is one of the best ways to improve hotel performance, boost guest satisfaction, and grow your business over time. But let’s be honest—some KPIs are easier to measure than others. Marketing KPIs? Those can be a bit of a headache.
That’s where Kurt’sCopy comes in. We help hospitality brands create content that connects with the right audience and drives real results. We know how to monitor your marketing funnel, fine-tune what’s working, and turn those numbers into more bookings.
If you’re ready to make smarter marketing decisions and get more out of your content, let’s chat.
Kurt Norris is the founder of Kurt’sCopy, where he helps B2B, e-commerce, SaaS, and local businesses craft compelling content and SEO strategies that deliver measurable results. With over six years of experience, Kurt specializes in creating data-driven campaigns that drive traffic, increase conversions, and establish brand authority.
