By Neil Hammond, Partner
With all of the disruption going on recently in the travel industry, we’ve collected some insights on what we found during last year’s hotel RFP season.
Market Predictions Held True
Multiple market forecasts predicted up to a 3% global increase in hotel rates in 2017. At GoldSpring, although we observed this trend in the market, we were able to contain it and keep our clients down to an average of less than 1% on their final program.
We saw amenities increasing again in 2017, with the most noticeable trend in the increase in fitness center and breakfast being included in negotiated rates. With an increasing focus on traveler satisfaction among hoteliers and travel category managers, this should be a welcome change for most.
Cancellation Policy Challenges
This year was the inflection point for same day cancellation becoming the exception rather than the rule for negotiated rates. This trend, however, was really limited to the U.S. and Canada. For the most part in the rest of the world, same day cancellation is still the norm.
There is also a marked distinction by chain. Hilton and IHG are setting the norm with about a 30% same day cancellation rate. Hyatt is a little more generous with 65%. Choice, Accor, and Carlson Rezidor seem to not be pushing back too hard on same day cancellation requests with 80-90%. On the other end of the scale, Marriott was at 15% (excluding the former Starwood brands). The former Starwood brands coming in at the same level as Hilton and IHG at around 30%.
Looking forward to 2018, this will be a trend to be aware of as same day cancellations will be harder to negotiate within the U.S. and Canada, with the potential to influence negotiations globally in the future.
Trimming the Number of Preferred Properties
Finally we are seeing that many programs are scaling down the number of preferred properties in their programs as the reliance and effectiveness of fixed rates deals decrease and dynamic pricing for individual properties or chain wide deals is on the rise to provide more blanket coverage on programs.
With the adoption of dynamic price tracking tools like TRIPBAM and Yapta’s RoomIQ, and the analytics they provide, this trend should continue in 2018 and beyond. For more information on how to utilize tech and other tools like dynamic pricing in optimizing your hotel program, click here.
So, what trends did you see in 2017? Did our list correspond with what you observed in your program? We’d love to hear your thoughts below.Back to all news