Hotels Remain on Track for a Good Summer 2021

Booking pace for North America (net new bookings made in May 2021 for stays across the region) shows another consecutive month of continued good news. It’s important to note that while the rate of month-over-month growth from April to May was generally in line with the rate of growth observed in the prior month (from March to April), it was behind the growth observed from February to March. 

For bookings made in May 2021 we see, not surprisingly, the largest jump in new bookings for stays in June (+116% MoM). Both July and August bookings show strong momentum as well with increases in net new bookings of 76% and 98% respectively. 

Switching the comparison from month-over-month to the same time in 2019, we see yet again a great deal of promise with the gap in new booking activity closed for June, July, and August to just -13%, -10%, and -11% 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 for much of the pandemic pace remained behind by 50-55%, more recently we’ve observed steady improvement. In March we saw pace lagging behind 2019 by -40%. In April that improved to -30%, and in May we see it improve further to -12%.

As vaccination rates increase in the US and restrictions are eased across North America and parts of Canada, we look to consumer search behavior on brand.com as an accurate predictor of demand for future stay dates. While in both March and April we noted 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. 

While web traffic for May grew by another 12% month-over-month and June by another 34%, we see the largest growth further into the summer months with July +106% and August +102%. 

Latin America as a whole continues to show volatility in terms of net new booking activity. Within the Americas, LATAM experienced the most significant growth of in-the-month-for-the-month bookings in May of +65%. In June we see a healthy growth of 73% (vs. the prior month’s growth of 52% for June) but further into the summer months, the growth slows substantially. Continuing on with the extremely short-term booking trend in LATAM observed last month, we see growth for July and August of only 20% and 19% respectively.

While pace compared to 2020 is significantly ahead for LATAM, compared to 2019 it continues to lag just slightly behind. June 2021 is pacing behind June 2019 by 14% (a further slip to the deficit of 9% for June we observed last month).  

In both April and May, we reported that the summer months were pacing in line with 2019, which signaled the first time we saw a region pacing ahead of a pre-pandemic period. While this month we see June, July, and August all pacing slightly behind 2019 (-14%, -6%, and -9% respectively), we now see that all months from September 2021 and beyond are pacing ahead of the same time two years ago. 

The earliest indicator of future demand in the Duetto application is consumer search behavior on brand.com and, with the exception of searches made in May for May stays, web traffic into Latin America continues to show positive momentum. This month we can report that the rate of month-over-month growth has further increased since our last Pulse Report for June and beyond. Last month we reported June +11%, July +16%, and August +19% while this month we see growth of +20% for June, +32% for July, and +41% for August. 

The velocity of bookings across the EMEA region were up by an astounding 913% for stay dates in June and impressive gains were posted through to January next year, providing increased visibility for the balance of the year, which will be very important as a baseline for the 2022 budget season we are about to enter.

While booking pace has jumped exponentially, OTB numbers across the uneven recovering EMEA region have yet to materialize in volumes that exceed the prior year. While OTB ADR is up over the prior year from July through January 2022 due to many different factors, including market mix shift, OTB rooms remain lower during stay dates starting in September 2021 onwards.

As restrictions are eased and hotels have started to reopen, consumer search behavior on brand.com for future stay dates has been an accurate predictor for the pent-up demand surge about to take place. The absolute volume of brand.com web searches for hotels and casinos across the EMEA global region nearly tripled versus the prior month in June and achieved triple-digit growth through October and remain at extremely high levels of web search activity for every month through to May 2022.

Booking pace for APAC continues to “normalize”, considering the area suffered from the effects of the pandemic shutdown first among global regions. Booking pace for stay dates in June through October were impressive but there was a slowdown in booking activity in the final two months of 2021, which illustrates some of the condensed booking window challenges that revenue managers are striving to overcome.

APAC is seeing greater volatility in on-the-books (OTB) than other global regions at their more advanced stage in the hotel industry rebound. In-the-month-for-the-month bookings propped up May and June OTB rooms and more impressively, ADR. However, OTB volumes now lag behind the prior year from September through early next year.

The earliest indicator of future demand in the Duetto application is consumer search behavior on brand.com, which is generally the largest share of a hotel’s channel contribution. Web search activity across the APAC global hotel region increased by 57% month-over-month for June stay dates and posted big gains during every month in the next 12 months with the exception of December 2021.