First of all, plan early! Begin to research hotels up to a year in advance. I always start with Fodor’s guide, because I find him fairly reliable with regard to hotels. I go to his website and check out the offerings. I usually print in a word processing file his entire entry on the hotels which I might consider. But which ones should be considered?
The answer here is same as in real estate — Location, location, location! I immediately eliminate all hotels out of the centro, or old town, since the convenience of being able to walk everywhere is much more important than price at this time. I also eliminate exorbitant hotels since I am always concerned with budget. So I look primarily at moderately priced hotels which have at least 3 stars in the European system (I might consider a 2-star if Fodor recommends it highly or thinks it is better than its rating). I print up this list and use it as my basic resource (it always includes things like address, phone number, and website, as well as comments about the amenities).
Next, I go to Borders or Barnes & Noble and cross-reference with other guidebooks (similar to the process for finding restaurants if you have read it on my blog). If there is a particularly important comment made in another guide book, I will write it in next to the Fodor entry.
Then, and Lee usually joins me at this point, we check out the websites for each of the possible hotels. Many of them have virtual tours of the hotel. This part is extremely important to Lee so I let her lead the way here. If she does not like what a hotel looks like, we eliminate it. The ones she particularly likes, we asterisk, and so on. At the end of this process, we usually have an ordered list of hotels for each of our stays. Then, and only then, do we call or email the hotel about availablility (although some hotels will only quote rates if you specifically inquire).
Finally, we select from the list and make our reservations. We have had marvelous success using this system, especially in Europe, where hotels vary greatly in comfort and amenities. Some of the amenities we look for are parking (very important in Europe where parking is at a premium), air-conditioning (most important if travel is in the summer months) and sometimes laundry facilities (at some point in our trip, we try to do some laundry, so we look for this about halfway through our trip).
Good luck with your travels and hope this helps.