Hotels not dropping prices
Mar 11, 2020, 7:22 pm
#1
Original Poster
Join Date: Feb 2020
Posts: 1,203
Hotels not dropping prices
checking hotel prices for Marriott and Hyatt hotels in Miami, New York and Cancun for mid-March 2020. Hotels are not dropping their prices despite many people cancelling business and personal travel due to the outbreak. What gives ?
Mar 11, 2020, 8:10 pm
#2
Join Date: Dec 2000
Location: Philadelphia
Posts: 2,506
Right now hotels know that most travel happening is essential and dropping prices won't likely spur additional travelers.
Mar 11, 2020, 8:49 pm
#3
Join Date: Nov 2018
Posts: 765
It only makes sense to drop the prices if you think it will lead to additional rooms being sold. As above, most travel happening now is probably essential and not very price sensitive.
There probably does exist a price below which you would convince people to travel, but it’s probably below the line of profitability.
There probably does exist a price below which you would convince people to travel, but it’s probably below the line of profitability.
Mar 11, 2020, 11:24 pm
#4
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Agreed... whatever demand for travel remains is quite inelastic. I’m sure a few bargain hunters would bite but on the whole dropping prices would hurt what little business they’re still getting, rather than drive much more business.
Mar 11, 2020, 11:42 pm
#5
Join Date: Nov 2011
Posts: 6,385
i have to say i can't wait until coronavirus passes and hotel occupancy will be down in the dumps still - good deals then!
Mar 11, 2020, 11:47 pm
#6
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Not true for my hotel, I'd say it is discounted 20-30% of what I stay last Nov/Dec and even Jan/Feb.
Mar 11, 2020, 11:47 pm
#7
Join Date: Feb 2013
Location: Miami, FL
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Disagree. I am getting great rates in San Francisco the past week and for next week. So perhaps it depends which city you are in. Deals are across board (IHG, Hilton, and Marriott) although I do agree - it's only at some properties, not all. Specifically, check properties that have conferences... they likely cancelled leaving great deals behind.
Mar 11, 2020, 11:52 pm
#8
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Because you don’t buy demand.
Mar 12, 2020, 1:29 am
#9
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Join Date: Feb 2004
Posts: 4,188
There is always a minimum price at any hotel. As the demand goes up, the price goes up. Right now, there is very few demand, so the price stay at the minimum price level, and this is a good deal. You will not see $50 for a 5 star hotel, period.
Mar 12, 2020, 1:45 am
#10
Join Date: Nov 2018
Posts: 765
I doubt the price is at the "minimum price level", even if a hotel has that. Pricing is set according to the conditions. If people were not travelling because they had no money (e.g. an economic depression, such as what may follow the coronapanic) then prices would absolutely come down further than they have, because lower prices would encourage travel. In this case, lower prices will not encourage (much) travel, so reducing prices further would simply reduce revenue.
Mar 12, 2020, 3:08 am
#11
Join Date: Oct 2015
Location: next to HAM
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Posts: 960
Hotels in Japan: -20 to -40% (even central tokyo at main cherry blossom time)
Mar 12, 2020, 6:15 am
#14
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The price action will be on the consolidator sites and finding good BRGs. I was considering a holiday to take advantage of the situation and found a few BRG opportunities so that would be my recommendation.
Mar 12, 2020, 7:51 am
#15
Join Date: Mar 2017
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for what it is worth ( well my 2c worth ) my prediction for hotel prices is that after ( may take six to 12 months to clear ) the virus travel situation, there will be a global recession,, and that's when the hotel / flights / travel prices will become lower, but not by much. Its not a good trade to get lower prices ......