As at 31 Jan 2019 the city ended at 54% occ after gaining 17% in occ during the month. The rate however dropped by 6% during the month between 1st and last day. Reports indicated that 75% of respondents ended 10% lower than 2018. Since 1 Oct Jan doubled its occupancy starting at 27% as at 31 Oct and ending at 54%. This is an increase of 10% every month as we approached Jan. The rate grew by R150 from 31 Oct to end of Jan which is R40 per month and or 18% over 3 months February started at 38% in Dec and at 1 Jan was already at 54%. Most of Feb’s bookings was made in Jan. Feb rate grew by 10% between 1 Jan and 31 Jan. Demand was good for the first 15 days but softens from 15th onwards. Hotels are lagging on LY by 10-15%. A report from Bcom says the booking pace is slightly ahead of last year this time but at 5% lower ADR; top source markets for CPT is SA(local), Germany, UK, Netherlands and Brazil. March is at 28% occ and R1650 rate as at end of Jan and gained one third in occ (28% and up 9% from end of Dec). 1-15 March have good demand but we see it dwindling again from 16-31 Mar despite it being school holidays. April is starting out at 23% occ and R1024 rate. April is the lowest starting point for any month since Aug 2018 and aside from Easter and WTM no other demand dates are evident. We expect winter 2019 to be very similar to 2018’s winter trading (May-Aug) Please note insights the data is collected from 16 000 available room nights. Various levels of hotels all around the CPT metro share their forward book and we can accurately portray the city’s forward book and changes in demand. We realise some upper segment hotels might not be close in numbers related to values quoted below but you should take into consideration the overall movement as the same change values will apply at ADT and Occ levels. Want to benchmark your own compset’s forward book? contact us now
Having a channel manager no longer guarantees parity
Ever heard of Smyrooms, Planetrooms, Findhotel, Nustay, Otel, Metglobal, Trip, lol.travel (yes lol), Amoma? Well neither have us and neither have we ever got a booking from any of these. Yet when Booking.com or Tripadvisor rate checks reveals these channels, usually at a lower rate than distributed BAR, we are being penalised on big producing OTA’s. At some clients we closed Agoda due to their ‘instant discount coupon’ they advertise at an (unauthorised) discounted amount, we still get Agoda bookings?! Yes it has become a true distribution nightmare and usually at the expense of lower production from Expedia and Booking.com. The nightmare gets worse: we contact these channels mentioned above to request (i) direct connection or (ii) remove the listing due to selling lower rates and we get no reply, or reply that ‘we have B2B merchant agreements with one or some of your contracted channels that we aren’t allowed to reveal due to confidentiality clauses’. We then attempt to make test bookings and more than often Hotelbeds or GTA are the main culprits. They would take the intended B2B rate for packaging, strip it ‘naked’ and on-sell to these unknown channels. None of their standard agreements prevent them from doing so and one would have to escalate one by one as the parity cases are reported to Hotelbeds. Whilst this is in progress the disparity scores on B.com drops one point a day. The result is lower ranking, less visibility and less revenue. Some hotels dropped 40% in OTA revenue due to this practise. Bcom reacted due to the loss of revenue and recently announced booking.basic where they will buy the lower rate and display it under the hotel’s profile. Read more here https://www.mirai.com/blog/booking-com-is-now-offering-third-party-inventory-with-booking-basic/ This is a double edged sword: your hotel’s distribution is uncontrolled, the overall rate is driven down, BAR values are unsold and only net rates are sold and disparity remain. In addition to the above we have to manage disparity reports on Bcom, quite often following the links in the price performance dashboard reveals ‘broken’ XML’s to Tripadvisor and Google. Despite escalation you get awarded 1 penalty point since ‘the hotel is to manage its distribution’ regardless of incorrect or no prices showing when clicking through. We at www.hotel-revenue-manager.com have one team member focussing on parity only. It’s a hard and long road if you want to keep wholesale channels open. Inaddtion to action outline earlier we suggest (i) advising the bedbank to not allow MSE distribution (not guaranteed though), (ii) load a MLOS of 2 or 3 nights to prevent disparity alerts. In extreme cases (iii) close them out completely, and /or (iv) end the contract if OTA loss is more than wholesale revenue. Need help? Contact us now
