By George Smith Last updated

STR stands for Smith Travel Research, a hospitality analytics firm founded in 1985.  STR was recently sold for £300 million in an all cash deal to real estate data firm CoStar Group. But what does STR do?

STR has a compound business model where hotels pay a monthly fee to see competitor data like occupancy ratesRevPAR and ADR.  The compound part of STR’s model is that these hotel customers also contribute their own performance metrics which STR then packages and resells to competitors and investors.  Every Tuesday STR customers receive a “STR Report” showing their hotel’s performance against a local compset so they can see how they’re doing on a relative basis.  STR also packages this data for investors, hotel tech companies and other industry stakeholders.

If you haven’t seen a STR report we’ll walk you through what one looks like. For those of you who get STR reports, have you ever looked at a STR report (pronounced Star Report) and felt like you were trying to read a different language? Between all the hotel industry acronyms and numbers, it’s easy to feel a little lost. In this article, we’ll share some tips on unlocking the treasure trove of data within your STR report whether hotel business is in North America, Europe or Asia Pacific.

STR reports are not to be confused with hotel star ratings, they help us understand financial performance of an asset rather than guest sentiment. Once you can read a STR report, you can apply your knowledge about your hotel markets compset and market trends to your own hotel’s strategy, which will help you meet your revenue and occupancy goals. But the STR report isn’t the only tool you can use to take your hotel’s performance to the next level.




Let’s rewind a bit; what exactly is a STR report? Developed by the hotel management analytics firm Smith Travel Research, the STR report is a benchmarking tool that compares your hotel’s performance against a set of similar hotels. The report is usually released every Tuesday and is delivered in a digital format, though you can also receive reports on a monthly or yearly basis. In order to receive your STR report, hoteliers must submit performance data (like daily occupancy and ADR) to Smith Travel Research, who then compiles all of the data they receive into the nicely presented STR reports.

You can find your own hotel’s data in your property management system, so the real advantage to looking at a STR report is understanding how your hotel is performing against other properties. To do this, STR uses anonymised data from your competitive set, which is a group of hotels that you choose for comparison purposes. We’ll talk more about choosing a compset below.

The STR report uses a variety of metrics to show performance data. Here are a few of the main terms that you’ll see throughout the report:

  • Occupancy = Rooms Occupied / Total Number of Rooms. Occupancy is expressed as a percentage, like 78%.
  • ADR (Average Daily Rate) = Total Revenue / Number of Rooms Sold. ADR is the average room rate sold for a given time period.
  • RevPAR (Revenue per Available Room) = Total Revenue / Total Number of Rooms. RevPAR can also be calculated as ADR x Occupancy.


You’ll also see your hotel’s performance calculated as an index, which shows you whether your hotel is performing better or worse than average within your competitive set. An index is calculated by dividing your hotel’s data (occupancy, for example) by the competitive set’s data (the average of all the competitive set’s occupancy numbers), then multiplying by 100. If your hotel scores higher than 100, then you’re outperforming your compset, or capturing more than your fair share. If your index is below 100, then you’re not earning your fair share and have some room to improve.




In order for the STR report to provide relevant information, you need to select an appropriate competitive set. Hotel management teams can easily get tricked by a STR Report if they have picked the wrong compset. You should pick a compset that most closely resembles your hotel type. A strong compset should include 3 to 5 hotels with the following characteristics:

  • Located within the same geographical area (exceptions could be for hotels located in very remote areas or certain airport hotels which compete with different markets)
  • Selling similar rates
  • Offering similar amenities
  • Targeting the same type of guests (for example, an extended-stay hotel would want to include other extended-stay hotels)


Keep in mind that you can always change your competitive set, so it’s okay if your first iteration isn’t perfect.




Once you’ve chosen a solid competitive set and have received your new report, it’s time to dive into the data. But with so many numbers to look at, where do you start? We’ll explain a few strategies to reading a STR report effectively, like looking for trends, comparing year-over-year numbers, and taking notes so you can get the most out of the report.




Let’s start on the “Glance” sheet, which follows the Table of Contents. On this sheet, you’ll see occupancy, ADR, and RevPAR broken down by each day in the last week. There’s a row for your, your compset, and your index. Again, if the index number is over 100, you’re doing better than your compset average, and if it’s below 100, you can room to grow. By taking a quick look at this sheet, you can easily see if your indexes are above or below 100, in general, as well as if your performance changed positively or negatively over the last week. What trends do you see? Is your performance up or down? How about your compset? Is a particular day of week performing better than others?




Looking at the percent change compared to last year can also provide insight into your performance. By looking at the RevPAR totals, you can get a quick snapshot into your hotel’s and your compset’s year-over-year performance for that week. Did the week perform better than last year? Or worse? And was your performance in line with the compset or different? Think about why that could be, perhaps a special event happened last year that didn’t return this year, or maybe several new hotels opened in the area which would lead to lower occupancy overall.

On subsequent sheets you can explore further into your year-over-year trends to pinpoint which metrics were affected. For example, maybe your occupancy stayed the same, but your ADR decreased. When you look on your “Segmentation at a Glance” sheet, you might notice that your group segment grew while your transient segment decreased. Since the transient segment generally has higher ADR than group, that might explain why your ADR was down overall. Knowing this, you could start to brainstorm strategies to attract more transient guests.




As you study your STR report, we recommend taking a lot of notes about your observations and explanations. You might add notes about a group booking that cancelled last minute as a cause for low occupancy numbers, or maybe a hotel next door had a power outage and you received a lot of unexpected business that led to higher RevPAR on a particular date. A year from now, when you wonder why your year-over-year numbers look the way they do, you can look back and thank yourself for taking detailed notes!

While the STR report shares a lot of valuable data, it’s purely quantitative. It tells us the “what” but not the “why.” To really understand what’s happening in your hotel’s performance and the market, you’ll want to dig into the “why” behind the data. Coupling your findings from your STR report with insight from a business intelligence tool or a rate shopper can help you develop more effective strategies to capture even more of your fair share.




There’s a reason why STR reports are so popular, but it’s important to remember that they don’t always tell the complete story. A revenue manager should have more tools in his or her toolbox to interpret data, such as business intelligence system and rate shoppers, to further explain the information that a STR report provides.

A business intelligence tool that pulls information from your property management system can be the key to understanding your hotel’s performance. When you use a BI tool like HotelIQ alongside your STR report, your STR numbers will make more sense within the context of your hotel’s full performance data. For instance, you can pull up your current promotion performance. Maybe this year’s holiday email campaign didn’t see as strong of results as last year’s, so that could be the reason why your December occupancy was lower than last year in the STR report.

A rate shopper can also provide valuable information about your compset hotels – in real-time. There’s no need to wait a week until the new STR report comes out; if you notice that your hotel is losing occupancy to the compset, you might want to see exactly what rates your compset hotels are selling. Maybe one hotel is running an aggressive promotion that’s causing guests who might have stayed at your hotel to stay at the hotel down the street.

A good revenue manager knows his or her way around a STR report, but a great revenue manager uncovers insights from multiple sources to paint a holistic picture and uncover trends. By reading a STR report and studying the trends and year-over-year changes, then comparing the data to your own property performance with a BI tool or compset rates with a rate shopper, you can take your revenue management strategy to the next level.

Post by George Smith

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