Benchmarking is comparing a hotel's performance metrics, typically occupancy, ADR and RevPAR, against its competitive set or market through shared data programs, to know whether results reflect the market tide or the hotel's own performance.
Index metrics divide the hotel's numbers by the comp set's. An index above one hundred means capturing more than a fair share. This separates a good quarter caused by a strong market from one earned against competitors.
Benchmarking is only as honest as the comp set and the data behind it. Hotels should also benchmark beyond rooms, comparing distribution costs, review scores and direct booking share, since those explain why the revenue indices look the way they do.
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