Skip to content


Innovator’s Spotlight: How Grupo Posadas Navigated Mexico’s Challenging Travel Environment

While Mexico continues to climb the ranks of the most visited countries in the world, tourism challenges are on the rise at a global level, driving hoteliers to navigate through all sorts of situations over the past year.

Despite challenges, Grupo Posadas — Mexico’s largest hotel operator — has managed to expand and grow revenue through it all. In 2017, the company recorded a 7.6% increase in RevPAR, including a 13.7% jump for its upper midscale brand Fiesta Americana. Posadas outperformed the Mexican market, which had 6.4% growth in RevPAR for 2017, according to published statistics from STR.

According to Erick Valdespino, Posadas’ associate director of pricing and revenue management, the challenging travel environment has caused Grupo Posadas to fall slightly behind growth targets it forecast for this year, but the company has still been able to record positive results, and even take some market share from competitors in the process. “We’re up in revenue about 4%, and in terms of RevPAR we’re up 4% compared with last year,” Valdespino said.

The company continues to test and implement new strategies, like Open Pricing and several other technological projects, in order to take more control of acquisition costs and offer a better direct-booking experience.

“The next step we want to take is to increase our contribution of the direct channels,” Valdespino said. “To achieve this, we are working on several projects to offer our guests a personalized experience when they book through our channels.”

Valdespino spoke with Duetto recently about what is new for both the Mexican market and Grupo Posadas.

Q: I imagine these different challenges in Mexico affect demand for certain segments and markets differently. How has that all gone for Posadas?

Valdespino: More than the challenges, recent changes in the booking curve were less anticipated than previous years. This has caused us to be more proactive on pricing strategies as we try to anticipate the changes in the market. One the segments in which we have observed a slowdown is the business segment, but we know it’s not exclusive to our hotels.

We continue to push ourselves to be creative to keep driving business to our properties. That’s why tools like Duetto help us make better decisions so we can spend more time analyzing the data instead of creating the data. This allows us to be ahead of our competitors and helps us to capture market share from competitors.

Q: How about the domestic leisure traveler? Did that customer group show the same kind of uneven performance as the business segment?

Valdespino: The trend we’ve seen in the domestic leisure traveler is slightly behind as compared to last year. We’re not getting more share from the domestic traveler, but we’re not losing share either. The domestic market in Mexico is very stable.

Q: What does Posadas do to address all these different changes in demand? What data do you prioritize and analyze, and what strategy comes from that?

Valdespino: When we noticed that the booking curve was getting shorter in the U.S. travel market, and it was less anticipated than it used to be, we adapted our pricing strategies to this shift in demand. Duetto was very helpful with this as we use the alerts of pricing and pace changes to focus on the dates that we need to prioritize or to try to generate more business in those periods.

What we did with this information was adjust our pricing strategy to offer more aggressive promotions during the anticipated period of bookings. For example, we’re very aggressive from 120 days to 90 days prior to arrival, and as the date gets closer, we’re trying to be ahead of the competition in each region to try and convert bookings with higher revenues.

On the revenue side, winter and the summer season were very difficult. However, we were able to recover in May, June and July with higher average daily rates as compared to last year. That’s a very good benchmark. The possibility of having multiple pricing strategies allowed us to be very aggressive on the anticipated market and have a gap with your comp set on rates by the time bookings started to come in.

Q: Posadas is trying to expand aggressively, but you also have to make your team as efficient as possible to let your strategy scale with the company. Has your team been able to increase its efficiency?

Valdespino: Yes, because we are in the middle of implementing Open Pricing and expect to have it done by November of this year. We have improved our efficiency a lot with our first implementation of Duetto versus our former revenue management tool. It’s been a big difference. When we have Open Pricing up and running, we expect to be more dynamic and to increase our revenue further. This will allow us to react faster to demand changes.

Q: Many hotel companies are looking to increase their direct bookings as a way to grow profits in a scalable way. What has Posadas done to improve the online booking experience and convert more of that business?

Valdespino: We’re more careful about the performance of our direct channels. One of our high-level objectives is to assure our previous guests book via our direct channels when they stay with us the next time. To accomplish this, we are working on several initiatives, like Open Pricing, that will allow us to offer guests a more personalized offers and a better booking experience through our channels. This, in result, will increase engagement with our direct channels and increase the profitability of our properties.

Back to Library

Duetto Content Team

The Duetto Content Team is made up of some of the brightest minds in the hospitality space. Through a mix of blogs, videos, whitepapers, social media posts, email campaigns and more, we focus on developing brand and product awareness, lead generation, engagement and more.

Speak to an expert

Contact us