Revenue Management

📈 On August 12, 2024, amidst market volatility, the U.S. Bureau of Labor Statistics reports a rise in unemployment to 4.3%. However, the travel industry remains strong, with 92% of Americans planning domestic travel within six months. TSA screenings show a 5.9% increase in travel volumes in June and July over the previous year, while international travel is up 18% year-to-date, nearing pre-Cold War levels.

💸 InterContinental Hotels Group (IHG) CEO Elie Maalouf revealed on August 12, 2024, investments in technology and loyalty programs to boost direct bookings. The group's guest reservation system (GRS), developed with Amadeus since 2015, enables upselling in over 6,000 hotels, averaging extra $40 in Luxury and Lifestyle, $20 in Essentials and Suites. Their cloud-based revenue management system (RMS), in 1,700 hotels, uses data science, AI, and predictive tools to optimize booking channels and pricing, showing initial revenue gains.

🏨 STR and Tourism Economics adjusted their 2024-25 U.S. hotel forecast: 2024 RevPAR remains at +2% YOY, ADR down 0.1 percentage points, occupancy up 0.2 points. 2025 occupancy projections increased by 0.2 points, ADR and RevPAR stable at +2% and +2.6%. Midscale and economy hotels affected by fewer low-income travelers, high-income travel persists. International demand pressured by strong dollar, European cost-of-living crisis, Asia Pacific's air travel recovery. Slower growth expected in 2025, yet improved international, business, and group travel forecasted. Annual GOP and EBITDA margins to improve YOY, labor costs to marginally decline, with upper midscale chains forecasting $168 less than luxury in labor costs for 2025. Prior forecast had decreased ADR by 1 point and RevPAR by 2.1 points for 2024; 2025 ADR and RevPAR projections had dipped 0.8 and 0.9 points, respectively.

🎰 Blackstone acquired a 65% controlling interest in Great Wolf Resorts in 2019, which then had 18 resorts. As of 2022, with over $2 billion invested, the company operates 20 resorts with three in the pipeline. John Murphy, CEO since 2022, emphasizes an average daily rate of $300, with a similar on-site spend. In 2023, Great Wolf opened its largest lodge in Perryville, Md., boasting 700 suites and a 128,000-square-foot water park. Additional lodges in Naples, Fla., and Webster, Texas, are set to introduce a new design. Furthermore, a $300-million lodge is planned to open in Connecticut by mid-2024. Occupancy levels average around 80%, with direct bookings making up 90% of business. They've recently partnered with Hilton Grand Vacations, and Great Wolf Lodge Grand Mound and Pocono Mountains have undergone significant renovations totaling $165 million.

📊 Discover, sort, and filter companies by criteria such as founded year, total funding, and HQ location. Analyze competitive sets, funding rounds, acquisitions, and IPOs. Utilize data presets like "Core travel verticals" for market insights. Interactive charts visualize founding and funding trends, while individual company and investor trends offer investment opportunities and market analysis.

✈️ TrEvolution Group recorded $639 million in gross bookings and over 510,000 airfare tickets sold between January and June 2024, a 20% year-over-year increase. Ticket sales to Italy grew by 99%, to India by 37%, the US by 24%, and Nigeria by 17%. Canada's flight purchases increased by 90%. 90% of air passengers flew Economy, and 11% flew Business. Round-trip tickets were 2.3 times more popular than one-way, with sales up by 13%. United, Turkish, Philippines, American, and Qatar Airways were top choices. Lufthansa and British Airways saw flight sales jump by 99% and 73.5%, respectively.

🏖️ Lastminute.com, a European tech travel company, revealed an increase in Gross Travel Value to €823.2 million, up 3% from H1 2023, and a 16% rise in revenues to €99.8 million. Gross Profit soared by 25% to €45.3 million. For January-June 2024, it led the fast-growing European travel segment, expanding into Iceland, Mexico, and Chile, while enhancing offerings with experiences and flexible options like deferred payments and insurance. CEO Luca Concone anticipates improved H2 performance with a new Ryanair partnership.

💰 NASHVILLE—STR and Tourism Economics adjusted their 2024-25 U.S. hotel forecast, with 2024 ADR gains downgraded by 0.1 percentage points, RevPAR steady at +2.0%, and occupancy upgraded by 0.2 percentage points. For 2025, occupancy growth projections increased by 0.2 percentage points; ADR and RevPAR forecasts remained at +2.0% and +2.6%, respectively. Economic factors may affect travel with slower growth expected in 2024 but moderate travel growth anticipated due to factors like strong household balance sheets. Midscale and economy hotels face challenges from fewer lower-income travelers, while high-income travel is constrained by increased outbound travel and a strong dollar. GOP and EBITDA margins are projected to improve slightly year over year, with 2025 labor costs forecasted to decrease, especially in upper-midscale chains, projected at $168 lower than luxury chains.

💰 IHG Hotels & Resorts reported 2024 half-year results with a +12% increase in operating profit and Adjusted EPS. Global RevPAR grew by +3.0%, while the Americas saw +1.7%, EMEAA +7.5%, and Greater China dipped -2.6%. The total gross revenue reached $16.1 billion, marking a +6% growth. IHG opened 18,000 rooms, leading to a global estate of 955,000 rooms across 6,430 hotels, and signed 57,100 new rooms (+67% YOY). A significant achievement was the $800 million share buyback program, already 47% completed by June 30, 2024, and an interim dividend increase of +10% to 53.2¢. With adjusted free cash flow at $132 million and a net debt increase of $510 million, IHG remains on track to return over $1 billion to shareholders in 2024.

📄 An audit of Excel spreadsheets revealed that nearly 90% have serious errors, with an average cell error rate of 5.2%. Hotel revenue management is particularly sensitive to these errors, where one misplaced decimal or extra zero can significantly impact forecasts and pricing decisions. Adopting an automated, cloud-based revenue management system enhances real-time data analysis and strategic decisions, moving beyond just historical data to include web activity, weather, air traffic, and reviews.