High Hopes for a Strong Summer

As we look at net new bookings made in April 2021 for stays across North America compared to bookings made in prior months, we see a continued trend of generally good news. The number of new bookings continues to grow month after month. 

It’s important to note, however, that the rate of growth from March to April slowed compared to the prior month’s growth between February and March. For bookings made in April 2021 for stays in May, we see a doubling of transactions (+104% MoM). While this is certainly another consecutive step in the right direction it should be put into context compared to the prior month where May bookings saw an increase of 187%. Similarly, June bookings grew by 61% (compared to 183% the prior month), July grew by 55%, and August grew by 42%.

Additionally, we can now begin to switch the comparison for months that were impacted by the pandemic in 2020 to the same month in 2019. Similar to what we saw last month for March, these numbers show a great deal of promise with the gap in new booking activity closed for May, June and July to -23%, -15%, and -10% respectively.

Pace for North America continues to increase as a result of the strong growth in net new bookings, particularly for the summer months. While we had watched as pace remained behind by 50-55% for the majority of the pandemic, last month we saw pace lagging behind 2019 by ~40% and this month we see a further improvement with a pace deficit to 2019 of ~30%.

While last month we were able to note that web traffic to Brand.com for North America closed the gap for the short-term (April 2021 down only 3% compared to April 2019; May 2021 up by 8% to May 2019; and June 2021 down only 3% to June 2019), we can now add that the growth continued for another consecutive month. 

Web traffic for May grew by another 20% MoM and June by another 100%. July and all the months following, however, still have a long way to go.

Latin America as a whole continues to show volatility in terms of net new bookings. While not as high as the increase observed last month of 110%, we do see in May another strong increase for bookings across the region of 52%.

Interestingly, in contrast to last month when we noted most of the new bookings were focused on the summer months of June and July, this month we see a slow down in new bookings for that time period. Instead, this month we see the biggest increase in booking activity for the very short term. 

This analysis was consistent across all of Latin America regardless of whether Mexico was split out or not.

Pace continues to lag behind for Latin America as a whole with May 2021 pacing behind May 2019 by 21% (a further slip to the deficit of 11% for May we observed last month).  

Last month we reported that June and July of 2021 were ahead of pace when compared to June and July of 2019 which signaled the first time we saw a region pacing ahead of pre-pandemic period. This month we see further improvement. June 2021 is now ahead of June 2019 by 9% and July is ahead by 5%. This early data could suggest that Summer 2021 has the potential for LATAM to outperform Summer 2019.

Web traffic into Latin America continues to show positive momentum. While the rate of MoM growth has slowed since our last Pulse Report (last month we reported a triple-digit percentage increase when we comparing searches made in March 2021 to February 2021), this month we again see growth on top of the prior month’s totals with May up another 7%, June +11%, July +16%, and August +19%.

As vaccination accelerates across the continent, new COVID cases are generally decreasing and restrictions are lifted. This has led to the positive trends highlighted in the last Pulse Report being accentuated during April. Although the situation is generally improving, it varies greatly from country to country. The region as a whole has experienced an increase in net new bookings of 196%, 2,928%, 70%, and 24% for April, May, June, and July respectively compared to March 2021 which shows clear signs of short-term recovery.

This time last year we were experiencing the full effect of COVID on the continent with most countries under very strict lockdown restrictions. Therefore 2020 data does not show the true picture of 2021 against a comparable business period. When we compared pick up patterns for example against 2019 and despite the recent positive trends, net pick up during April has been 66%, 82% and 90% lower than in the same period in 2019 for April, May and June stay months respectively.

The high level of population vaccination and the imminent reopening of most hotels meant that the UK saw a very positive increase in bookings compared to the previous Pulse Report. April, May, and June saw increases of 160%, 134%, and 45% compared to March 2021. In contrast, the DACH region, generally still under stricter restrictions, also saw a positive increase but solely concentrated in the short-term with April and May seeing 162% and 63% increases in net bookings respectively with a slower pace of reservations from June onwards.

As the summer approaches, despite the uncertainty about travel, appetite for travel and the pent-up demand for Southern European destinations keeps on delivering positive net pick up. Compared to March 2021, Iberia and the rest of Southern Europe experienced a positive increase in net bookings all the way until September. However, the majority of the bookings are concentrated in the next three months. Iberia saw an increase during April of 449%, 248%, and 203% for April, May, and June stay months. The rest of Southern Europe also saw increases in April of 408%, 933%, and 75% for the same months.

We need to take a few things into account when comparing business on the books with 2020 figures. First of all, EMEA was under strict restrictions at this point in time last year and, as a consequence, business on the books in the short-term is now well ahead in 2021 compared to 2020. Second of all, at this point in time last year, many consumers were still holding on to their previously booked summer plans, making the overall pace from June onwards still negative when comparing 2021 to 2020

To put things into a more useful perspective, comparing April 2021 against April 2019, the EMEA region as a whole sits at -79% for April and May, -72% for June, and -59% for July. When looking at the different regions the situation in terms of pace is very similar. 

• UK and Ireland show a deficit compared to 2019 of -78%, -67%, and -49% for April, May, and June respectively. The current pace is clearly looking better compared to other regions in Europe from September onwards.
• Following the slower pick up patterns previously reported for DACH, the accumulated deficit in pace compared to 2019 currently sits at -80%, -83%, and -75% for April, May, and June.
• We will carry on monitoring the summer months for Iberia and Southern Europe. If the positive pick up trends continue or even accelerate further, the summer ahead of us could show some good recovery. It could even mean that the summer season extends well into September and October, however, it is too early to be certain about this.

Hotel web searches continue to grow for the entire region. In the previous Pulse Report, we reported an increase in web searches of 104% from May to September. This month we see a further increase of 48% for the same period. 

The two regions leading the overall total volume of searches are Iberia and the rest of Southern Europe with 48% and 87% respectively. Regions like the UK and DACH have experienced a positive, although more moderate, increase with 39% and 36% rises respectively. 

There are plans afoot to introduce a passport vaccination program and also the implementation of a traffic light system for regions where travel is recommended. This will massively influence the volume and flow of web searches to the different destinations competing for travelers from Northern Europe.