MPI (Market Penetration Index)

MPI (Market Penetration Index) measures a hotel's occupancy performance relative to a defined competitive set (comp set). It answers the question: "Are we getting our fair share of the market's demand?"

Formula

MPI = (Hotel Occupancy / Comp Set Occupancy) × 100

Interpretation

• MPI = 100 — The hotel is getting its fair share of demand.
• MPI > 100 — The hotel is outperforming the comp set on occupancy.
• MPI < 100 — The hotel is underperforming the comp set on occupancy.

Example

Your hotel runs 80% occupancy while the comp set averages 70%. MPI = (80 / 70) × 100 = 114, meaning you're capturing 14% more than your fair share of demand.

Why it matters

MPI is part of the STR performance index trio alongside ARI (rate performance) and RGI (revenue performance). Together they show whether a hotel is winning on volume, price, or both.