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1. Corporate Travel Shows Signs Of Recovery
There are signs corporate travel is starting to recover, as executives take to the road (and air) once more.
“Where government restrictions have been removed, we see that demand is returning very strongly,” said Paul Abbott, CEO of American Express Global Business Travel, AmEx GBT.
According to Abbott, the recovery is being driven by small and medium-sized businesses, which can ‘make decisions faster’.
AmEx has seen recovery fastest in the US, with international travel in Europe dampened due to restrictions.
Marriott said US corporate demand in May was 50% from 2019 levels, while group bookings in Hyatt rose 55% in the first quarter of 2021 compared to the fourth quarter of 2020.
2. Booking Windows Lengthen For Vacation Rentals
The latest data from private accommodation specialist Vacasa indicates that the median booking window for vacation rentals shifted from 20-30 days to 35-40 days in Q1 of 2021.
Length of stay has also increased 5% with three nights now the most popular option. And spend has also improved, up six percentage points to 39% for the $250-$499 price range, while the $50-$249 dropped by eight percentage points.
3. Why Now For Travel Subscription Models?
This was the question posed at the Phocuswright Europe Online 2021 virtual travel conference, as industry leaders from TripAdvisor and citizenM came together to discuss their new subscription programs.
Lennert de Jong Chief Commercial Officer of citizenM talked of the challenges of moving from a more “transactional environment”, which is normal for the hospitality industry, to the “customer relationship environment” of a subscription model.
citizenM had been working on developing subscription models prior to the pandemic and introduced its corporate subscription plan last year. The subscription enables subscribers to work from the ‘living room’ area at any citizenM hotel (normally priced at $20 per day) throughout their subscription period, stay for three nights per month in any citizenM hotel, and use meeting rooms at any citizenM hotel for three hours per month, with the option to add more nights or meeting room hours at a discounted rate.
“For us, subscriptions are the ultimate form of commitment,” said de Jong. “The moment that you buy Amazon Prime, you’re committed to buy at Amazon, and you’re not in market any more for anything else.”
4. Are Budget Hotels Set To Thrive?
Price is the most important factor to almost half of consumers when selecting accommodation, according to a poll by GlobalData. The data and analytics company notes that, with less budget for travel but a strong desire to escape, many travelers will turn to budget hotels.
GlobalData’s latest consumer survey (Q1 2021) showed that travelers are more price-sensitive than before the pandemic. On the flip side, accommodation prices have increased. According to Gus Gardner, associate travel and tourism analyst at GlobalData, U.K. breaks were 35% more expensive this year than last year.
“The pandemic has placed a considerable strain on travelers’ finances,” Gardner said. “Despite this, travel demand is still high, and many are looking to escape in desperate need for a change of scenery. Travelers are more likely to trade extras offered at mid-to-upper-scale hotels for a more basic ‘pay for what you need’ service standard.”
5. Benchmarking: Moving Beyond Traditional Comp Sets
Duetto’s Ira Vouk weighed in with her opinion on benchmarking and comp sets in the latest Revenue Manager Roundtable on Hospitality Net. In this article, Vouk outlines her "5 reasons NOT to follow your competitors' prices".
“Knowing and understanding what other players are doing is important. But properly recognizing demand fluctuations and managing/navigating the flow of demand coming into your property is more crucial,” Vouk said.
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