Global Hotel Booking Volumes Level as Rates Continue Steady Climb

According to Pegasus Solutions, one of the world’s largest processors of electronic hotel transactions, global business and leisure hotel bookings remained steady in October, as bookings continued a steady year-to-date climb for both channels and rates paid improved slightly over the previous year.

The number of global corporate bookings, those made through the global distribution systems (GDS), in October 2013 matched that of October 2012. Rates increased a slight +0.5% over the previous year, despite global political issues and the US government shutdown. Year-to-date, rates inched up +0.6% over 2012.

“Five years ago, our industry had just been hit with the effects of the economic downturn,” said David Millili, chief executive officer of Pegasus Solutions. “Hotels across every region and segment experienced a dip in occupancy and rates. Bookings have been recovered for a couple of years now, but we continue to struggle to return rates to 2007 levels. For the corporate channel, October rates actually set a year-to-date pace of +1.1% over October 2007, though they were still off that month’s performance by -3.5%. Every bit of growth we see in those rates brings us closer to being fully ‘recovered’, which is still a ways off for the leisure market.”

Leisure bookings came within -1.3% of last year, setting a pace of +1.7% year-to-date. Rates travelers paid were +2.3% higher than 2012, upholding the +2.7% year-to-date growth pace over prior year. This slight improvement during an off-peak season indicates promising growth for 2013’s upcoming holiday travel. Compared to October 2007 levels, leisure rates are still off by -15.7%, even as volumes are a full +25.1% higher.

More stable booking volume is expected through the end of the year for both corporate and leisure bookings. Rates for the corporate market will continue to grow through December, with an extra bump expected in January. Consumers booking through online channels will be paying about +3% higher rates than prior year through the first of 2014.

Data reported by Pegasus Solutions comes from billions of transactions processed monthly for nearly 100,000 hotel clients, facilitating more than $16 billion a year. The Pegasus View reflects data drawn from both GDS and ADS transactions, representing the business and leisure markets respectively.