Top 10 Revenue Management KPIs - BeSafe Suite
Indicatori di Revenue Management

Top 10 Revenue Management Indicators

We often hear about ADR, RevPar and Parity Rate in the travel industry, but are we sure we know exactly what these terms mean and do we really know what the main indicators of Revenue Management are?
Let’s explain in detail the top 10 Revenue Management indicators.


One of the most common acronyms is certainly ADR, which is often misused to define the average sales rate. In reality, ADR stands for average daily rate, thus identifying, the average daily rate.
This indicator is at the heart of the entire revenue management strategy as it allows one to analyse historical sales trends and make forecasts for the future.
If, on the other hand, we are analysing the average monthly, annual or weekly rate or the average rate of a room type in a given year, we will be able to analyse the average daily rate.
If, on the other hand, we are analysing the average monthly, annual or weekly rate or the average rate of a type of room in a given period, we are not referring to the ADR but to the ARR, or the average room rate.

RevPar: revenue calculated on available rooms

As highlighted in previous articles, RevPar is one of the most important indicators in revenue management.
This term, which is an abbreviation of Revenue Per Available Room, indicates the ratio between turnover and available rooms in a given period of time.
It differs from ADR and ARR as the latter establish the ratio between turnover and rooms sold. With RevPar, therefore, we can assess the impact on the revenue of our business of both the rooms sold and the rooms left empty (which will average 0 on the final result). It follows that the higher the occupancy rate of our rooms, the closer the RevPar figure will be to that of the ADR and ARR and vice versa.

Parity Rate: anachronistic dogma or functional strategy?

For years, in the tourism industry and, above all, in revenue management, we have been talking about Parity Rates as objective to which one should aim but which, in the jungle of unclear discounts and hidden offers, has become a chimera that is impossible to achieve.

So what is Parity Rate? It is the situation in which on all distribution channels (or, better, on those that address the same target audience, such as OTAs) we have the same rate for the same date, for the same type of room and under the same conditions.
Although software such as channel managers allow the revenue manager to synchronously submit the same rate for the same date, for the same type of room and for the same conditions, the widespread practices of re-selling and commission undercutting prevent the realization of a true parity rate.

Minimum Stay, Maximum Stay, CTD and CTA: strategies based on the number of nights

Among the various operations implemented by the revenue manager in order to achieve the set objectives, there are the strategies based on the number of nights.
Especially during holidays, events or other dates of particular demand, restrictions can be set to make the most of market trends. These include: minimum stay, a minimum number of nights, maximum stay, a maximum number of nights, CTD (close to departure), the closing of a date on departure, CTA (close to arrival), the closing of a date on arrival.

If, on the other hand, we talk about average stay we are referring to an the average number of nights per stay, on the basis of which we can take certain commercial actions.

GOP and GOPPaR: the most important indicators for hoteliers

Although indicators such as Revenue, ADR and RevPar are essential for the revenue manager, both to understand sales trends and to plan future strategies, there are two indicators that are crucial for hoteliers to truly understand if and to what extent he is he is gaining or losing money.
These are GOP (Gross Operating Profit) and GOPPar (Gross Operating Profit Per Available Room).
GOP is the figure that represents the gross operating margin or the difference between the total revenues and total costs in a given period (before taxes, interest and depreciation).
GOPPar, like RevPar, shows GOP divided by the number of available rooms.

GOP is essential to really understand the profit margin of a property. GOPPar, on the other hand, allows you to make a more in-depth analysis and to take corrective action in your revenue management strategy.

Categories Strategies