The latest edition of Duetto’s Pulse Report, which assessed hotel metrics from July 13-26, showed a strong uptick in demand linked to the July 4th holiday, but as predicted back then, the increase has done little, if anything, to revive the market. Data for North America and Latin America continued to trail heavily behind the same time last year with depressed figures for all metrics measured.
Data for the stay month of August showed a slowdown in net pick up across North America. Short-term new bookings for stays in both August and September slowed during the weeks of July 13-26 compared to the prior Pulse Report (June 29 to July 12).
“A lot of the numbers are down, especially when we look at the major markets. New York, not surprising for a lot of people, is down as well a Chicago, Los Angeles, and San Francisco. Seattle is surprisingly down—even though it is thought to be well beyond the peak of the virus at this point,” said Daniel Lofton, director of Hospitality Solutions, Americas, and one of the Pulse Report authors.
“When we looked at Nashville, it was doing well at the beginning of June, and has now declined. Nashville is a drive-to market and would certainly be the kind of place where we would expect leisure travel to start to come back, and it did look like it was heading in that direction at the start of the summer,” Lofton added.
On a positive note, Duetto reported a slight uptick in the longer-term bookings window during the report period from July 13-26, with stays for October and November increasing by 32 percent and 34 percent respectively.
As net bookings continue to lag behind last year, pace (i.e., on the books versus the same time last year) is also showing little sign of recovery. August and September remain more than 50 percent behind the same time last year, and despite October and November’s slight improvement in new bookings compared to the previous Pulse Report, Q4 2020 as a whole remains 46 percent behind.
Interestingly, despite the slowdown in new bookings for the short-term stay window, web traffic suggests there is interest. Website visits for both August and September doubled as compared to previous weeks. It will be interesting to see if in the weeks to come if these web searches end up converting into new bookings.
Latin America continues to face difficulty with new bookings. The most recent two weeks of data from July 13-26 showed a further slowdown in new booking activity for the region, with August now slowing by an additional 41 percent as compared to the prior Pulse Report. The remainder of the year is showing this slowdown to varying degrees. September shows the least amount of drop off with only a 4 percent dip compared to the prior weeks of data, while November and December show the most significant slowdown at 73 percent and 71 percent, respectively.
Latin America also remains significantly behind in terms of on-the-books reservations as compared to the same time last year. This is expected to continue until there is a substantial increase in new booking activity across the region.
The most recent data in Latin America reflects a similar trend in North America: Despite a slowdown in new bookings, web traffic shows a significant increase for the short-term window. Traffic for stays in the month of August increased 190 percent over the previous weeks. Both September and October also showed healthy increases in web traffic—106 percent and 60 percent, respectively.
“Notably, the only market I was able to find with some positivity was Cancun—it’s not up, but is on par with last year, which is very impressive,” said Lofton.
Pace in Cancun remains behind the same time last year, but new bookings and the web shopping coming into the market is fairly positive.
“The one thing I noticed about Cancun that was not the same story for Nashville or San Francisco or elsewhere in the United States was Cancun’s average daily rate (ADR) has dropped dramatically. In Cancun, hotels are running a lot of promotions to get people into the market and their properties, which is giving them an occupancy boost,” Lofton explained.
“There’s a big difference between lowering your BAR rate and putting out a promotion. The promotion is for a limited time. And at this time, you do not have to worry about threatening your corporate traveler or threatening your group business,” he added.
Can Marketing Save Summer?
The Pulse Report figures from the tail end of July for both North America and Latin America do not make for promising reading, but Lofton believes hoteliers have one last chance to save the summer, especially if they take into consideration web traffic data.
“We are seeing a tremendous amount of web traffic indicating consumers are looking to book and yet we are seeing a decline in conversion rates. This tells us there are people who are interested in traveling, but we believe they are not converting due to the high rates at this time,” Lofton explained. “I know everyone is pulling back their marketing budgets, but now could be the right time to consider putting some promotions out there. August is going to be the last hurrah, our last chance to gain a share of the leisure market. Once the end of August and September hit, and children start going back to school—whether virtually or in-person—leisure travel will dissipate.”
“If you are in a seasonal market that is strongly driven by summer demand, this is definitely something to think about,” Lofton concluded.