According to the latest aggregated data from HotStats,
global RevPAR has increased by 19% since 2019. Over the same period, Booking
Costs PAR rose by 25%, reflecting a significant increase in the cost of
acquiring bookings. This imbalance, combined with sustained cost inflation,
particularly in labour, has had a marked impact on flow-through.
Data for 2025 shows that average flow-through declined to 18% in The Americas
and 29% in Europe, compared with historical levels of approximately 50% in
previous years. The findings indicate that hotels focusing solely on top-line
revenue growth, without incorporating cost and profit considerations, face an
increased risk of margin erosion.
The analysis also points to technology challenges
faced by hoteliers when managing costs and profitability. Many technology
providers lag in supporting strategies that integrate revenue and profit
management. One exception identified in the analysis is Duetto, which acquired
HotStats in 2025 and subsequently introduced its Revenue & Profit Operating
System.
Aggregated HotStats data shows that hotels using both
Duetto and HotStats solutions achieved a 6.8% increase in Gross Operating
Profit Per Available Room in 2025. This represents a 2.1 percentage point
improvement compared with averages for similar companies.
The impact of the Revenue & Profit Operating System was recorded shortly after implementation. Customers reported an average improvement of four percentage points in performance indices when comparing rolling 12-month periods before and after adoption.
“The disconnect
between revenue growth and profit conversion is the defining challenge of this
market,” said Alex Zoghlin. “The data clearly shows that looking at RevPAR in isolation is no
longer enough to secure a hotel’s financial future. By integrating financial
benchmarking directly with revenue strategy using our RP-OS, our customers are
making smarter decisions based on what actually drives the bottom line.”
“With flow-through rates an ongoing challenge, the margin for error is
non-existent,” said Michael Grove. “The hotels that are winning
are the ones that can monitor their costs and profit data in real-time and
adjust their revenue strategies accordingly.”
The findings underline a shift in hotel commercial
strategy, with revenue and profit teams increasingly required to adopt unified
approaches that integrate cost control, profitability data and revenue
optimisation into daily decision-making.
Tags: Alex Zoghlin HotStats Michael Grove Duetto