How to use PriceLabs for Hotels: Understanding Custom Compsets

A hotel comp set analysis is the process of identifying the hotels guests actually compare you against, then tracking their rates, occupancy, and positioning to price your own rooms with more confidence. This guide covers how to build that compset, the metrics that prove it is working, and how PriceLabs' custom compset feature removes the manual spreadsheet work behind it.

In the dynamic hospitality industry landscape, staying competitive is paramount for success. Dynamic pricing has emerged as a game-changer, and PriceLabs stands at the forefront. It offers a powerful toolset for hotels to optimize their pricing strategy. In this blog post, we'll delve into what are hotel compsets and how to use PriceLabs for hotels, focusing on the advanced customization feature of custom compsets.

What is a Comp Set?

A comp set, short for competitive set, refers to a group of hotels that potential guests consider when making booking decisions. These hotels are competitors that are compared against your property, not just based on location but also considering various factors such as target market, amenities, pricing, and brand affiliation.

Understanding your comp set involves identifying hotels in your vicinity, those catering to similar corporate clientele, sharing brand affiliations, offering comparable amenities like pools or restaurants, and sharing similar pricing strategies. It encompasses a thorough analysis of room types, suite options, pet policies, security features, guest amenities, and other relevant details to gauge your competitive position in the market accurately.

Heading into 2026, this exercise matters more than ever. Guests routinely check three or four properties side by side on their phone before booking, weighing not just the nightly rate but reviews, cancellation terms, and last-minute availability. A comp set built only on proximity misses this reality. The hotels guests actually compare you against might be two miles away with a similar star rating, or a short-term rental listing with the same bedroom count, rather than the property physically next door.

Types of Hotel Comp Sets

Not every hotel needs the same kind of comp set. Here is how the main types compare.

Comp Set Analysis for Hotels

Most hoteliers only need a primary comp set for daily pricing, then layer in a secondary or event-based set when demand patterns shift.

How to identify your Comp Set?

Identifying your comp set involves strategically assessing key features and benefits your property offers compared to neighboring hotels. Focus on properties similar in size and amenities to accurately gauge competitiveness. For instance, a limited-service property with breakfast and meeting space won't directly compete with a large banquet center, and that's acceptable.

Effective sales strategies hinge on a thorough breakdown of the comp set. Conduct extensive research or involve your team to gather detailed information about each potential competitor. Assign team members to different properties and incentivize them to gather comprehensive insights.

Consider various traveler personas to understand how different guests would evaluate properties. For instance, corporate travelers may prioritize reward perks and proximity to their company, while wedding guests might prioritize shuttle service or discounted rates.

By evaluating properties from multiple perspectives and understanding how travelers perceive each option, you can accurately identify your comp set and tailor your strategies accordingly.

How does PriceLabs work?

PriceLabs employs a sophisticated algorithm considering various factors to generate optimal hotel pricing recommendations. These factors are broadly categorized into three buckets: broad trends, daily demand trends, and lead time-based trends. Broad trends include elements like base price and seasonality. Daily demand trends reflect fluctuations in demand for specific dates. Lead time-based trends adjust prices based on how far in advance a booking is made.

Key Metrics That Prove Your Comp Set Is Working

A comp set is only useful if you measure performance against it. Three benchmarking metrics, borrowed from STR reporting, tell you exactly where you stand.

• MPI (Market Penetration Index): Compares your occupancy share against your comp set's average. Above 100 means you are winning more than your fair share of demand.
• ARI (Average Rate Index): Compares your ADR against the comp set average. Above 100 means you are commanding a rate premium.
• RGI (Revenue Generation Index): Combines MPI and ARI to show your RevPAR performance relative to the set. This is the clearest single signal of whether your pricing strategy is working.

Example: If your MPI is 90 but your ARI is 130, you are pricing above the market and losing occupancy to it. That combination usually means it is time to soften rates on select dates rather than hold the line.

Which customizations are offered by PriceLabs for Hotels?

Recognizing that each hotel has unique considerations, PriceLabs offers advanced customization features to fine-tune pricing strategies. Among these, the Custom Compsets feature is pivotal in tailoring the pricing approach. It gives recommendations based on what is happening with the neighboring hotels. Let's discuss these customizations in detail.

Demand Factor Sensitivity:

One crucial aspect of PriceLabs customization is the Demand Factor Sensitivity setting. This feature allows hoteliers to adjust the sensitivity of their pricing to daily demand trends. You can choose from options like Recommended, Low, High, or No Demand Factor. Hence, it provides flexibility in managing price fluctuations based on demand for specific dates.

• Recommended Setting: The default setting where PriceLabs optimizes pricing based on the algorithm's recommendations.
• Low Setting: A conservative setting for users who prefer more stable pricing and less sensitivity to daily fluctuations.
• High Setting: An aggressive setting for those who want to maximize prices during peak demand periods.
• No Demand Factor: Turning off the demand factor for dates where dynamic pricing adjustments may not be desired.

You can set the demand factor to come from the full hotel data tab instead of Airbnb. This provides more accurate pricing based on hotel-specific demand trends.

Demand Factor Sensitivity

Customize Hotel Weights:

The next customization feature is Customize Hotel Weights, which allows hoteliers to control the influence of hotel-like properties in the pricing calculations. This is particularly beneficial for properties that share characteristics with both hotels and short-term rentals. It can be divided into the aforementioned categories.

• Mostly STR: 10% hotel weight, suitable for properties predominantly catering to short-term rentals.
• Mostly Hotel: 90% hotel weight, ideal for hotels with limited short-term rental attributes.
• Fully Hotel: 100% hotel weight, suitable for properties exclusively functioning as hotels.
• Fully STR: 0% hotel weight for properties exclusively functioning as short-term rentals.
• Balance: 50% hotel weight, a neutral setting for properties with a mix of hotel and short-term rental features.

Customize Hotel Weights

Customize Hotel Compsets:

Customize Hotel Compsets is a crucial feature that allows you to select specific hotels for pricing comparisons. Here are key considerations for this customization:

• Ensure a minimum of 5 hotels in the compset for effective comparisons.
• The selected hotels in the parent listing's hotel data tab will be considered for child listings, or default hotels will be used.
• Hotel prices used for the comparison are based on a length of stay (LOS) of 2 nights, using Best Available Rates for double occupancy.

You can set the demand factor to come from the hotel data tab instead of Airbnb, providing more accurate pricing based on hotel-specific demand trends.

How PriceLabs helps: Beyond Custom Compsets, the Hotel Data Tab tracks pricing across up to 350 nearby hotel-style properties and refreshes regularly, so the manual side of building and re-checking a comp set disappears from your weekly to-do list.

Customize Hotel Compsets

Steps to Conduct Hotel Competitive Set Analysis using PriceLabs

Conducting a Hotel Competitive Set Analysis using PriceLabs involves several key steps to ensure accuracy and effectiveness in benchmarking your property against competitors.

1. Identify Key Competitors: Identify hotels in your area that are considered direct competitors. These are properties that offer similar amenities, target the same guest demographics, and are located in close proximity to your hotel.
2. Access PriceLabs Dashboard: Log in to your PriceLabs account and navigate to the Dashboard or Competitive Set Analysis section.
3. Define Custom Compsets: Utilize PriceLabs' Customize Hotel Compsets feature to create custom compsets tailored to your specific market. Select hotels from PriceLabs' database that closely match your identified competitors.
4. Select Relevant Data Points: Choose relevant data points and metrics to analyze. This may include room rates, occupancy rates, booking trends, amenities offered, and guest reviews.
5. Compare Pricing Trends: Use PriceLabs' tools to compare your hotel's pricing trends with those of your identified competitors. Analyze how your rates stack up against the competition over different time frames, such as daily, weekly, or monthly.
6. Evaluate Occupancy Patterns: Assess occupancy patterns of your compset hotels to understand demand fluctuations in the market. Identify peak booking periods and adjust your pricing strategy accordingly.
7. Analyze Amenities and Guest Satisfaction: Compare the amenities offered by your hotel with those of your competitors. Evaluate guest satisfaction metrics such as review scores and ratings to identify areas for improvement.
8. Adjust Pricing Strategy: Based on your analysis, adjust your pricing strategy to stay competitive in the market. Consider factors such as seasonal demand, special events, and competitor pricing trends.
9. Monitor Performance Regularly: Continuously monitor your hotel's performance relative to your compset. Regularly review pricing data, occupancy rates, and guest feedback to make informed decisions and adapt your strategy as needed.
10. Iterate and Optimize: Use insights gained from your competitive set analysis to refine your pricing strategy over time. Experiment with different pricing tactics, monitor the results and iterate to achieve optimal revenue performance.

By following these steps and leveraging the features of PriceLabs, you can conduct a comprehensive competitive set analysis to understand your market position better and drive success for your hotel.

Best Practices for Ongoing Comp Set Review

A comp set is not a one-time project. Markets shift when new hotels open, brands change flags, or a competitor renovates and re-prices upward.

• Revisit your list quarterly. New supply or closures change who you actually compete with.
• Track ARI and RGI monthly, not just occupancy, so you catch rate erosion early.
• Pull a KPI report covering ADR, occupancy, and RevPAR pacing against last year, so trends are visible at a glance, not buried in spreadsheets.
• Cross-check with revenue management fundamentals so your comp set data feeds a broader pricing strategy, not just isolated rate matching.

PriceLabs empowers hotels with dynamic pricing strategies that adapt to the nuances of the market. The ability to customize compsets based on demand sensitivity and hotel characteristics, along with the flexibility to set the demand factor from the full hotel data tab, provides a level of precision that is invaluable in today's competitive hospitality landscape. For hotels seeking to maximize revenue and outperform the competition, PriceLabs, with its advanced customization features, is a key ally in the journey toward success.

Way Forward

A hotel comp set analysis works because it replaces gut-feel pricing with a clear view of who you actually compete with and how your rates measure up. Start with a tight, custom compset inside PriceLabs, track MPI, ARI, and RGI monthly, and review the list every quarter as your market shifts. The hoteliers who win are not the ones who check their competitors once, they are the ones who make it a weekly habit.

Key Takeaways

• PriceLabs offers advanced customization features, including Demand Factor Sensitivity and Hotel Weights, allowing hotels to tailor their dynamic pricing strategy with precision.
• Customize Hotel Compsets enables hotels to select specific competitors for pricing benchmarks, ensuring accurate comparisons and strategic decision-making.
• Hoteliers can fine-tune sensitivity to daily demand trends with Recommended, Low, High, or No Demand Factor settings, providing adaptability to different market scenarios.
• Customize Hotel Weights allows hotels to control the impact of hotel-like properties in pricing calculations, ensuring accurate rate recommendations based on property attributes.
• Setting the demand factor to come from full hotel data enhances pricing accuracy, providing hotels with a competitive edge in the dynamic and ever-evolving hospitality landscape.

FAQs

What is a hotel comp set?

A hotel comp set is a group of hotels that guests compare against your property based on location, price, amenities, and guest type, used to benchmark rates and occupancy.

How many hotels should be in my comp set?

PriceLabs recommends a minimum of 5 hotels for effective comparisons. Most hoteliers aim for 5 to 10 properties, since fewer gives a noisy sample and more dilutes the signal.

What is the difference between MPI, ARI, and RGI?

MPI compares your occupancy share to your comp set's average, ARI compares your rate to the average, and RGI combines both to show your overall revenue performance relative to the set.

How often should I update my hotel comp set?

Review your comp set quarterly, and check rate and occupancy data against it weekly, since demand and competitor pricing can shift quickly around events.

Can short-term rentals be part of a hotel's comp set?

Yes, especially in markets where guests choose between hotels and vacation rentals for the same trip. PriceLabs' Hotel Weights setting lets you control how much each data source shapes your recommendations.