How Hotels Can Prepare For New EU Payment Rules

August 8, 2019 | Sarah McCay Tams, Director of Content, EMEA

Seven trending hotel news stories that will impact your hotel Revenue Strategy.

1. The Hotelier’s Guide To New EU Payment Directive

HotelNewNow (HNN) ran a review of the new European Union PSD2 payment-services directive, which comes into force on 14 September, and what it could mean for the hotel industry.

The new PSD2 regulations cover online customer authentication. Hotels will need to have their booking and payment systems watertight to avoid the risk of customers abandoning their booking, as authentication becomes mandated on all payments.

Hotels will also have to ensure that they are holding customer data securely. Credit-card information will need to be kept under a security veil or tokenization, and not on an Excel spreadsheet.

Full story at HotelNewNow.

2. RevPAR Up But Profit Down For Europe’s Hotels

Europe’s hotels saw RevPAR peak at €158.82 for June, the highest in 12 months, but it wasn’t enough to boost bottom lines, as gross operating profit per available room (GOPPAR) continued to fall, down 2.8% to €101.00.

Falling ancillary revenues and rising costs have been attributed to the profit decline, in a month that saw occupancy up 1.4 percentage points to 82.5% and a 0.5% decline in achieved average room rate, which fell to €192.61.

Paris was one city that bucked the trend, with GOPPAR up 23.5% on the back of the 53rd Paris Air Show. The biennial event welcomed more than 315,000 visitors, boosting average room rate by 16.4% to €472.86, more than €120 above the YTD average at €352.26. RevPAR in the French capital soared 19.5% to €417.23.

Full story at Revenue Hub.

3. Hotels Score Run On Cricket World Cup 

The Cricket World Cup helped UK hotels to an especially strong month in June, with GOPPAR up 10.8% year-over-year, at £75.47, a recent high and 61.5% above the year-to-date figure. June was the first month this year that UK hotels have recorded a YOY increase in profit.

Top line figures also put in a great performance, with a 0.7-percentage-point increase in room occupancy to 84.6%, and an 8.6% YOY increase in achieved average room rate, at £137.36. RevPAR hit £116.24,  almost £20 higher than in May.

Full story at HotStats.

4. Americans Flocking To Europe On Vacation

More Americans are set to holiday in Europe this year, with interest in European destinations up 29% year-on-year, according to data from Squaremouth. Portugal has seen the biggest increase in traveller interest, up 48%, followed by Spain (37%) and Greece (31%).

However, the average cost of a trip to one of the 10 most popular European destinations has dropped, down 6% to $3,815, down 6% from last year. According to Squaremouth, travellers heading to Greece are spending the most, with an average of $4,664 per trip, while travellers heading to Spain are spending the least, down 13% to an average of $3,027 per trip.

Full story at eHotelier.

5. Rooms Over Supply Drowns Middle East Market

The Middle East’s hotels market is facing a problem with oversupply that is leading industry leaders and hotel owners to re-think strategy in the region.

According to Skift, the Middle East saw a 9.3% Y-o-Y increase in hotel rooms in construction as of April 2019, with 424 hotel projects (125,052 rooms) in construction.

Q2 2019 data from STR has shown that supply has outgrown demand in the city for six consecutive quarters, with occupancies at lowest for a second quarter in Dubai since 2009.

As such, owners, investors and brands are now looking at third party management to boost revenue and profits – a model that has proved popular in the US and Europe, but that is still in its infancy in the Middle East.

Full story at Skift.

6. Mobile Bookings Up For Expedia In UK

Expedia Group has announced that it saw double-digit growth in mobile bookings for UK staycations in Q2 2019, with destinations such as The Cotswolds seeing a demand increase of 30%. Other locations seeing growth included the Lake District, up 20%, and Brighton, up 10%.

According to Expedia Group, there is a rising generation of mobile-savvy travellers who are booking their trips on mobile apps or sites via Smartphones and tablet devices rather than laptops.

Mobile bookings for UK travellers looking further afield were up for destinations including China, Hong Kong, Indonesia and Korea, which also experienced double-digit growth.

Full story at Travolution.

7. Ramadan Shift Prompts Profit Slump

With this year’s Ramadan falling mostly in May, hotels in the Middle East and North Africa (MENA), reported a 6.4% Y-o-Y decline in profit per room at $47.25 for June, according to data from HotStats.

Ramadan is a large demand generator for hotels. Linked to the Lunar cycle, it moves each year. This year there were only four days of the holy month in June and therefore, while occupancies were up 10.2 percentage points to 65%, achieved room rate dropped 18% to $149.12. RevPAR dropped 2.7% to $96.91 and TRevPAR at hotels in MENA fell by 1.4% in June to $171.34.

Full story at Hotel News Resource.

Stay up on hotel Revenue Strategy news and discuss industry tech trends in the Hotel Revenue Strategy Leaders Group on LinkedIn.

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