Fair Share

Fair Share is the share of market demand a hotel would receive if all hotels in its competitive set captured demand strictly in proportion to their room inventory. It is the baseline against which actual performance is compared in STR-style benchmarking.

Formula

Fair Share % = Hotel's Available Rooms / Total Comp Set Available Rooms

Example

A 200-room hotel competes against four other hotels with a combined 800 rooms. The total comp set has 1,000 rooms. The 200-room property's fair share is 200 / 1,000 = 20%.

If the comp set as a whole sells 700 rooms on a given night, the property's "fair share" of those bookings would be 140 (20% of 700). If it actually sold 160, it captured more than its fair share. If it sold only 120, it captured less than its fair share.

Why it matters

Fair share is the bridge between absolute performance and relative performance. A hotel that sees occupancy drop from 85% to 75% might look like it's struggling — but if the entire market dropped from 80% to 65%, the property actually gained market share. Indexes like MPI translate fair share concepts into a single 100-baseline number that's easy to compare across periods.

Related concepts

• MPI (Market Penetration Index) — fair-share-adjusted occupancy index
• ARI (Average Rate Index) — rate version of fair share
• RGI (Revenue Generation Index) — RevPAR version of fair share

Together, these indexes are the standard vocabulary for talking about whether a hotel is winning or losing in its market.