Hotels must identify true competitors, as not every nearby hotel qualifies, the analytics company said. They should first identify their guests—business travelers, leisure guests, or groups—and select competitors with a similar customer base. Performance data should then confirm the comp set reflects the competitive landscape.
If a hotel generates significant revenue from F&B, events or wellness services, it should benchmark against hotels with similar operations. Market conditions such as seasonal trends, demand patterns and pricing also affect performance, so the comp set should include hotels facing similar scenarios.
A common mistake is relying on the same comp set for years, HotStats said. When a hotel’s positioning or market changes, the comp set should be reassessed and updated.
Hotels should compare ADR trends to understand how others price rooms, HotStats said. Labor cost efficiency should be reviewed to assess alignment with similar hotels. If F&B is a key revenue stream, the comp set should include hotels with comparable operations.
A comp set must include at least four hotels, excluding the subject property, to ensure effective external benchmarking and prevent any single property from disproportionately influencing performance comparisons.
It must also include hotels operated by at least three different companies and representing at least three different brands, excluding the subject hotel, to ensure confidentiality. These requirements protect the anonymity of financial data and maintain benchmarking integrity.
No single operator or brand should represent more than 50 percent of the total room count in the comp set and no brand parent or franchisor can exceed 70 percent, HotStats said. This prevents any one entity from disproportionately influencing results. Hotels from the same data provider are excluded to ensure a valid comparison.
A comp set should evolve as new competitors emerge, guest preferences shift and industry trends change, HotStats said. Regular updates maintain competitiveness in pricing, labor management and revenue strategies. Maintaining these standards ensures hotels can confidently analyze financial and operational performance to optimize their strategies, according to blog.
In a recent blog post, HotStats said hotels should look beyond RevPAR to include TRevPAR and GOPPAR for a fuller performance view.
