European hotel rates continue to fall in December

This article talks about the impact of the supply and demand law on the hotel rates.

One can see that at the end of 2009, the economic crisis is not over as the hotel rates have decreased between 5 and 15 % compared to December last year. Hotels are now making efforts to adjust their rates so as to still attract customers. In United Kingdom, prices have been decreased (in Edinburgh by 15%, in Birmingham by 19% etc...) even if this country remains the top country of high hotel rates.

However area of growths for hotel rates are still found with special monthly events in cities offering Christmas markets or cities organizing unique events like Copenhagen for the World Climate Conference (hotels increasing their rates up to 21%). In these cases, they are never enough hotels in the cities to cater for the demand from visitors from all over the world.

http://www.hotelmarketing.com/index.php/content/article/european_hotel_rates_continue_to_fall_in_december/

Comparative Analysis of Hotel distribution

Hotel Belle Epoque

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Reverse Auction Sites

Reverse Auctions Sites

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Hotels need to rethink their OTA strategy

http://www.hotelmarketing.com/index.php/content/article/hotels_need_to_rething_their_ota_strategy/

I chose this article because it is a good representation of the issues found today in direct and indirect online sales.

Online, hotel customers can compare easily selling rates on their hotel websites and indirect selling rates on the OTAs. Quite often they are different because the hotel has given special discounts to the OTAs for volume purchasing and these ones have not followed the hotel’s recommended minimum selling price and are becoming their competitors.

OTAs are capable of doing that because they offer hotel rates as part of holiday packages that attract the customers because of the low cost and a large variety of choices. Customers go to OTA because they will be able to sort the travel packages by price, amenities or proximity to a city, penalizing that way some hotels.

What can a hotel do today to regain control on the selling rates? They can try to renegotiate lower discounts with OTAs (no sales less than their minimum rate-which is quite difficult). Hotels should instead become more competitive with better prices for their volume purchasing customers and for special occasions (like New Year’s Eve, Valentine’s Day, Christmas …). They could also start proposing themselves packages to the guests.

Characteristics of an OTA

Classwork done with Gabrielle Desroches on thursday December 3rd.