What to do when historical data stop guiding you
In the COVID era, historical data may only remind us that the past seemed better
So how can we tell whether we are doing well or badly amid uncertainty?
It is not easy to make decisions when everything changes overnight. Now more than ever, the so-called “butterfly effect” shapes what happens to us. And the butterflies seem to be flapping hard: government restrictions are coming from the north, south, east and west.
Then you watch everything fall apart and none of it seems to make sense. German guests who were due to arrive cancel; the Nordic markets pick up; two bookings from the United States and three from Ukraine come in; the UK market seems to be returning, but rumours are flying… In short, you are completely lost.
“The world has gone mad and I just want reliable data!”
I do not have a definitive answer to all of this. But if you work with Booking.com, Expedia or a leading booking engine, you should know that they offer country-level demand trends.
Expedia, for example, provides reports on the countries searching for accommodation in your destination over the next three months:
Booking.com has similar insights. In Analytics > Booker Insights, you can find trends for the countries guests are currently booking from:
If your booking engine includes an integrated BI (Business Intelligence) tool, it should provide this information. Otherwise, Google Analytics can show the geographical origin of visits to your website for any date range you choose.
So, with the data in hand, should we offer discounts by country?
My answer at the moment is clear and emphatic: yes. We should encourage bookings from countries where demand is trending upwards.
I have always supported price segmentation. Country-specific rates and discounts are useful when they reflect real differences in demand between markets.
If you are new to hotel Revenue Management, here is some background. Some Revenue Managers adopted the message from Booking.com, Expedia and other major online platforms that hotels should maintain the same rates in every market. They repeatedly warned us that our properties were falling behind, that we were “losing money”, and made plenty of other arguments for avoiding country-specific rates and discounts. But what was really happening was that traditional tour operation was being sidelined even though it was still very much alive—and the platforms could see there was a type of customer they could not reach.
Their position was partly based on not having the technology to manage this kind of segmentation. Now, at last—Expedia and some booking engines had already recognised this for some time—they have realised that it is not only useful, but essential for competing in certain markets.
The situation is now very different. Platforms allow country-specific discounts and have greatly improved their distribution to third parties through B2B channels.
And here is what that looks like:
Expedia
In the extranet, under Marketing > Promotions, you can add or remove countries from a promotion.
Booking.com
Under Promotions, look for the Country Rate option to apply discounts by region.
Booking engines
Any booking engine worth its salt should let you offer discounts by country or region. Ask your Account Manager about these options; if your provider does not offer them, it may be time to consider a change.
The conclusion is that we need to base our actions on data. In periods like this, when historical patterns are unreliable and the present and future keep changing, we must adapt and find data to support our pricing decisions.
Stay strong!