This paper provides evidence for different innovation activities in the hotel industry. In particular, we explore the influence of a variety of firm and market characteristics on radical and incremental innovations. We consider the learning of new attributes (radical) and the addition of characteristics to existing attributes (incremental) to represent two different paces or degrees of managing the innovation process in this specific industry. The database used in the empirical study shares the major features of new approaches about innovation in services. A questionnaire administered to a representative sample of hotel managers in the Balearic Islands provides the data for the discrete regression models used to represent the innovation in these hotels. Our main conclusion is that radical and incremental innovations appear to be interrelated. Furthermore, the main determinants of innovation are the form ofhotel management, the hotel market strategy, and the size and location of the hotel.