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Revenue Management Woordenlijst

Gemiddelde tariefindex (ARI, ADR-index)

Definition

The Average Rate Index (ARI/ADR Index) is a metric used to compare your property’s ADR over a given period of time to the ADR of the hotel’s in your compset in the same time period. It is expressed as a percentage and is used to understand how your pricing compares to similar hotels in the area.

How to use it

An ARI of more than 100% is an indication that your property is outperforming your competition, either due to anq effective pricing strategy or because you have successfully established a premium value proposition. An ARI of less than 100% shows that you are earning less revenue than your competition; if the lower price is due to a strategic pricing decision to gain market share, that doesn't require any updates, but if not, you are likely underpricing your rooms (compared to what guests are willing to pay).

Formula

Calculate your ARI by dividing your property’s ADR over the given period by your compset’s ADR over the same period, and then multiplying that number by 100.

Related Terms

Occupancy, ADR, RevPAR, Compset, ADR Index, Revenue Management, Online reputation, Market share
ADR is an important metric for hoteliers, and so calculating your ARI (which shows how your ADR compares to that of your compset over a given period of time) is an important way to ensure that you are pricing yourself competitively, no matter how the market changes.

Hannah Lee

Hannah Lee