Room Numbers

Hotel consolidation is changing the rules of engagement – but the rate games still go on
Consolidation in the hotel industry is at an all-time high. Flags are moving around like pieces on a chessboard and brands are battling to be the last one standing.

Historically, rapid consolidation would mean tougher negotiating for travel buyers, since they have less leverage at negotiation time. However, the actual picture on the ground is more complicated, because in the end, the corporate-property relationships tend to be individual ones.

While all that is happening, consolidation is giving larger chains more visibility into a corporate travel program’s spend and market share. This can lead to a competitive environment where hotels with greater degrees of rate control can drive prices up in compressed markets.

“Travel managers and procurement leaders can prepare for these scenarios,” says Lexi Benakis, director of hotel sourcing/consulting for HRS in the Americas. “The best tactic: Have deep insight and awareness of their own travel data, as well as their ability to shift share to preferred hotel partners via alteration of their online booking tool and/or internal communications to travelers and the admins that book for higher-yielding executives.”

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