Financial Glossary
ADR (Average Daily Rate)
Average Daily Rate (ADR) is the average revenue earned per occupied room, site, or unit over a specified period, calculated by dividing total room or site revenue by the number of units sold (not available). ADR isolates pricing effectiveness from occupancy, making it a direct measure of rate realization. It excludes ancillary revenue such as food and beverage, camp-store sales, and activity fees, which keeps the metric focused on accommodation pricing. ADR is one of three inputs in the RevPAR identity -- RevPAR equals ADR multiplied by occupancy rate -- and is used in benchmarking, dynamic pricing decisions, and financial reporting for hotels, campgrounds, RV parks, marinas, and short-term rentals.
Problem & Application
A 60-site campground sells 1,200 site-nights in a month and collects $66,000 in site revenue, yielding an ADR of $55. The prior month it ran 1,500 site-nights but collected only $67,500 -- an ADR of $45. The month with fewer bookings actually produced a stronger rate and nearly equivalent revenue, suggesting the lower-volume month's pricing strategy was more efficient. Reviewing ADR by channel reveals that OTA-sourced bookings averaged $48 while direct bookings averaged $64; OTA commissions of 15% reduce the net rate further to approximately $40.80. Shifting 10% of bookings from OTA to direct preserves the same gross revenue while improving net ADR by roughly $2.50 per unit. This kind of channel-mix analysis -- only possible when ADR is tracked separately by source -- is a primary lever operators use to improve margin without adding a single new site.
In Short
ADR measures pricing power; paired with occupancy it drives RevPAR and underpins any revenue-management strategy.