TL;DR — Gross ADR is the rate you charged. Net ADR is the rate you actually kept. The gap, channel by channel, is where commission leakage lives — and on most boutique P&Ls it's worth 4–9 percentage points of operating margin. This post lays out the formula, a worked example across five channels, and a one-page monthly report layout that fits any revenue management cadence.
If your weekly STR-style report opens with Occupancy / ADR / RevPAR and stops there, your owner is being told a story that ignores 18–28% of their commission cost. The metric that fixes it is net ADR.
The Formula
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Net ADR (channel) = Gross ADR (channel) × (1 − all-in channel cost rate)
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Where "all-in channel cost rate" is the sum of: - Commission (OTA, wholesaler, GDS) - Payment processing - Channel-specific marketing spend amortized per booked night - Cancellation drag (foregone yield × cancellation rate) - Loyalty / member rate discount cost (for direct)
The output is a real, comparable number across channels. RevPAR derived from net ADR is the only RevPAR figure that matches what hits the operating account.
Worked Example — A 60-Key Boutique, March 2026
| Channel | Bookings | Gross ADR | Channel cost rate | Net ADR | Net RevPAR contribution |
|---|---|---|---|---|---|
| Direct (member) | 320 | $268 | 4.2% (CC + member discount) | $257 | $137 |
| Direct (public) | 240 | $282 | 2.8% (CC fees only) | $274 | $110 |
| Booking.com | 410 | $280 | 22.4% (commission + cancel drag + payment) | $217 | $148 |
| Expedia | 165 | $278 | 25.8% (merchant model) | $206 | $57 |
| Wholesaler / FIT | 95 | $238 | 18.0% (net rate) | $195 | $31 |
| GDS / corporate | 50 | $258 | 14.5% (commission + GDS fee) | $221 | $18 |
| Total | 1,280 | $272 gross | — | $232 net | $501 |
The gross-to-net delta on this property in March: $40 per occupied room-night, or 14.7% of gross ADR. Annualized at this run rate, that's roughly $580K of revenue that exists on the gross report and does not exist in the bank account.
Why Reporting Net ADR Changes Decisions
Three concrete decisions that flip when you switch from gross to net:
1. Channel mix optimization
Gross-ADR-based reports tend to under-flag the OTA mix because OTAs frequently produce higher gross ADR than direct (OTAs are good at last-room availability and at premium room types). Net ADR shows the truth: even with a $12 gross premium, an OTA booking yields $40–$57 less than a direct booking on this property.
2. Promotion ROI
A 6% member rate looks like a discount on a gross ADR report. On a net ADR report, the member rate booking nets $11 more than a Booking.com booking at full price — i.e., the "discount" is profitable.
3. Renovation & capex pacing
If you're justifying a $400K renovation against incremental ADR, gross ADR will overstate payback by the channel cost rate. Owners who model with gross ADR systematically over-invest and under-pay-back.
The Sample Monthly Report Layout
A one-page net ADR scorecard that fits on a single sheet:
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PROPERTY: [Hotel Name]
PERIOD: [Month YYYY]
BASE: 60 keys, 31 nights, 1,860 available room-nights
================================================================ HEADLINE ================================================================ Occupancy: 69% Gross ADR: $272 Net ADR: $232 Gross RevPAR: $188 Net RevPAR: $160 Gross-to-net leak: 14.7% ================================================================
CHANNEL DETAIL Bookings Gross ADR Cost% Net ADR Net RevPAR Direct (mem) 320 $268 4.2% $257 $137 Direct (pub) 240 $282 2.8% $274 $110 Booking.com 410 $280 22.4% $217 $148 Expedia 165 $278 25.8% $206 $57 Wholesaler 95 $238 18.0% $195 $31 GDS / corp 50 $258 14.5% $221 $18
================================================================ MIX SHIFT (vs. prior month) ================================================================ Direct share: +2.4 pp → +$11K net contribution OTA share: -1.8 pp → Required to maintain occupancy Wholesaler: -0.6 pp → Pruned low-yield contracts
================================================================
WATCH ITEMS
================================================================
- Expedia merchant cost rate trended up 1.1 pp on cancellations
- Member-rate signups up 14% MoM; net ADR contribution +$3.8K
- Branded paid search CPA down to $6.20/booking (target $9)
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The point of this layout is that it forces three decisions every month:
- Where is mix moving? Up the net ADR ladder or down it.
- What is the largest single source of leakage? Always a specific channel; usually fixable.
- Which experiments are paying off in net terms? Member rate, mobile-only, package rate.
How to Build This Without a Custom BI Stack
Most boutiques don't have a data team. The minimum viable build:
- Pull bookings by channel from your PMS. Mews, Cloudbeds, Stayntouch, SiteMinder all export this. Mews makes it easiest with native channel-level commission tracking.
- Build a channel cost table in a spreadsheet. One row per channel with the all-in cost rate computed from the breakdown earlier in this post. Update quarterly.
- Compute net ADR per booking (gross × (1 − cost rate)) and aggregate by channel.
- Drop the table into a Google Sheets or Excel monthly summary that auto-pulls the PMS export.
Total setup time, including channel-cost research: about a day and a half. Total ongoing time per month: about 30 minutes.
This is the report your owner has been trying to read without realizing it. Once they see net RevPAR alongside gross RevPAR, the conversation about OTA mix, rate fences, and direct-booking investment stops being theoretical.
About 360VUES — Matterport 3D capture and virtual tour production. The single fastest way to move net ADR is to shift mix toward direct — and the fastest way to do that is to give the direct booking surface something the OTA listing can't show.