A spike in business at hotels last year—particularly on the business travel side, of which meetings are a part—prompted a price increase in virtually every market around the world.
According to Hotels.com’s Hotel Price Index (HPI), rates went up 8 percent in the Pacific, 5 percent in North America, 4 percent in Latin America, 3 percent in the Caribbean and 2 percent in Europe and the Middle East. Only in Asia did prices decline, and that was just by 2 percent. The overall increase reflected a continuing trend of steady recovery after a 13 percent tumble in 2009, the research report stated.
“When we look at the drivers in major cities like London and Hong Kong, business travel is a driver,” said Matt Walls, vice president of marketing for Europe, Middle East and Africa at Hotels.com.
Working with a healthy industry is generally good news for meeting planners—except possibly when it comes time to negotiate, Walls said.
“Negotiating with hotels is easy when they’re half empty but more health in the industry will no doubt come with harder bargaining,” he said.
However, planners will still have some flexibility, Walls noted.
“Occupancy is still not where it was so there’s room for hotels to be fuller,” he said. “And the seasonal nature of resorts will definitely lead to greater flexibility in the shoulder and off-seasons.”
And there are still some areas of opportunity, Walls contends.
“New Zealand is definitely worth a look. A lot of hotel building happened there for the World Cup, so there are many new and refurbished hotels; I would imagine there’s excess supply,” Walls suggested. “And in Asia, there’s a lot of building going on, which will keep prices keen.”
David Roche, president of Hotels.com, added that prices still aren’t at pre-recession levels, making the near-future a good time to head overseas.
“With Hotel prices overall still below their 2005 level, now is a great time to go out and explore the world,” he said.
The hotels.com HPI is based on bookings made on the company’s sites around the world and tracks the real prices paid per hotel room per night (rather than advertised rates) for about 142,000 properties in more than 19,800 locations in over 85 countries. The latest HPI looks at prices in 2011 compared to 2010.
