Depend on the purpose of classifying hotels, there are 5 mainstream ways to label hotels. Meanwhile, as almost every hotel is unique, the categories list could be as long as someone wants. And any hotel can always be fitted into more than one, two or three categories.
Classified by size
Running a hotel with 100 rooms and running a hotel with 1,000 rooms are 2 concepts. Not to mention the 10,000 rooms Abraj Kudai—the world's biggest. Meanwhile small, medium, big or giant are definitely relative concept.
In UK, the industry standard is:
Small hotel: 25 rooms or fewer
Medium hotel: 26 to 100 rooms
Large hotel: 101 to 300 rooms
Very large hotels or mega hotel: 301 or more
In other places, it’s usually defined as:
Small: 150 rooms or fewer
Medium: 151 to 299 rooms
Large: 300 to 600 rooms
Mega hotels: 600 rooms or more
So 150-room is a small hotel, 151-room is a medium hotel, right? Yes, a little bit absurd, but that’s sometimes how management or economic concept looks like.
Classified by stars
See: Hotel rating system
Classified by location
Airport hotel / Transit hotel
It’s close to airport or busy railway station. Airport hotel usually offers free shuttle bus to airport, that further reduces the concern of catching plane
Typically located at vacation destinations, Almost all resort hotels feature spas and pools. To make it more attractive, extra activities and facilities like skiing, surfing, dance party, golf or volleyball are at most times provided.
Downtown hotel / City center hotel
The target customers of downtown hotels are normally business travel guests.
Suburban hotel / Country hotel
Hotels in this category, if are not resort hotels, are usually conference hotels. Groups of seminars, exhibitions, shows, training are their main business.
Cruise ships are representative floating hotels.
Classified by ownership
Parent company owned hotel
Management contract hotel
Independent chain, Referral Groups, and Branded Distribution Company
Classified by service level
This is the most popular method to classify hotels in practice. In big hotel companies, different brands usually suggest diverse level of service—software, amenities and hardware. Classifying hotels by service level, like segmenting hotels by brands, is a convenient and useful approach.
- Luxury—typically offers first class accommodations and an extensive range of on-property amenities and services, including restaurants, spas, recreational facilities, business centers, concierges, room service and local transportation (shuttle service to airport and/or local attractions). ADR (Average Daily Rate) is normally greater than USD210 for hotels in this category.
- Upper Upscale—typically offers a full range of on-property amenities and services, including restaurants, spas, recreational facilities, business centers, concierges, room service and local transportation (shuttle service to airport and/or local attractions). ADR normally falls in the range of USD145 to USD210 for hotels in this category.
- Upscale—typically offers a full range of on-property amenities and services, including restaurants, spas, recreational facilities, business centers, concierges, room service, and local transportation (shuttle service to airport and/or local attractions). ADR normally falls in the range of USD110 to USD145 for hotels in this category.
- Upper Midscale—typically offers restaurants, vending, selected business services, partial recreational facilities (either a pool or fitness equipment), and limited transportation (airport shuttle). ADR normally falls in the range of USD90 to USD110 for hotels in this category.
- Midscale—typically offers limited breakfast, selected business services, limited recreational facilities (either a pool or fitness equipment), and limited transportation (airport shuttle). ADR normally falls in the range of USD65 to USD90 for hotels in this category.
- Economy—typically offers basic amenities and a limited breakfast. ADR is normally less than USD65 for hotels in this category.
Classified by target market
The needs of business travelers and sight-seeing travelers are mainly different. The basic demand of travelers from hotels are similar, so in early days there are no so many segments. But as competition is getting tense, hotels evolved into many brands and becoming niche oriented.
Keeps company guests top of mind, it’s usually located in downtown or business districts, closing to office buildings, equipped with business center and limousine.
Mainly of their business from overnight travel layovers, cancelled flights guests and airline crews. Closing to airport is its key competitive advantage.
Many business hotels have suite rooms, but suite hotel usually has only suite rooms.
Extended Stay Hotel
This type of hotels is for long-staying guests. To satisfy them better, extended stay hotels usually design their rooms carefully with kitchens and other special space.
It normally offers very limited of service to reduce operation costs, that makes it enable to offer competitive price for mid-term, long-term staying guest. Beside their limited service are usually outsourced.
Intended primarily for vacationers, is usually located near special attractions, where guests can easily access to beaches, seashores, scenic, historic areas, or skiing. Some resorts operate on a seasonal basis, most of them operate all year-round, but the rate of peak times is usually much more expensive.
Bed and Breakfast / Homestays
Usually some small motels, the breakfast is very simple. Now many luxury or mid-market hotels include the breakfast charge in their room rate, but they are not in this category. This category is specially for economic hotels.
Timeshare / Vacation Rentals
You can put most Airbnb accommodation into this category, basically. Timeshare hotel owner owns or purchases of a period of ownership of a house or room. They stay in the room or rent it out online or hire management company to do it.
To offer accommodation for gamblers and tourists. Customers receive the benefits of both gambling facilities and lodging. Since the casino and hotel are located on the same premises, all the gambler's necessities can be provided in one location.
Conference and Convention Center
Equipped with at least one auditorium and concert halls, lecture halls, meeting rooms, and conference rooms, is designed to hold meeting and conferences and offer food and beverage and accommodation to the attendees.
Guralnik, David B. (1974). Webster’s new world dictionary (Second College Edition). p. 263. Cleveland New York: The World Publishing Company.