Consumers are often waiting until the last minute to commit to booking a trip, a byproduct of continually changing travel guidelines and restrictions, as well as shifting traveler perceptions of where travel is “safe.”
Those shorter booking windows are complicating workflows for suppliers. But some also see opportunities to exploit the trend.
“Lead times are getting much, much shorter,” confirmed Misty Belles, managing director of global public relations for Virtuoso, during the consortium’s virtual Virtuoso Travel Week event in mid-August.
“People are booking closer in, and right away. They’re making plans and then going as soon as they can.”
For the second quarter, Virtuoso reports that around 43{143106009d8b87d45252e1fd973f0c0835ad3aabba3679e828c3cd83539ae06c} of its U.S. hotel bookings were made two weeks or less in advance of a trip’s start date, versus 37{143106009d8b87d45252e1fd973f0c0835ad3aabba3679e828c3cd83539ae06c} in the second quarter last year.
Apple Leisure Group and Pleasant Holidays both have said much of their domestic and Mexico bookings for 2020 have been last-minute. Even adventure-travel companies are seeing the trend.
“We are seeing high demand and last-minute bookings,” said Tania Burke, president of Trek Travel, which offers biking trips. “We had a guest call Saturday to book a trip starting Sunday.”
Katie Moro, vice president of data partnerships for Amadeus’ TravelClick hotel tech arm, called this short-term, compressed booking window “the most important trend” for hoteliers this summer, with U.S. hotel demand tending to spike seven days or less prior to the time of travel.
For some U.S. properties, that window is even tighter. Sietse Nabben, general manager for the recently opened Canopy by Hilton Jersey City, estimates that up to 70{143106009d8b87d45252e1fd973f0c0835ad3aabba3679e828c3cd83539ae06c} of actual occupancy in the Jersey City, N.J., market is being booked just 24 to 48 hours prior to arrival.
“This is tough to manage both operationally and from a human resources perspective,” said Nabben. “You have to be able to pull resources, either from your own employee pool or third parties, to accommodate a high influx of last-minute travelers. Temporary hiring and the reactivation of guestroom inventory are just some of the components that require a very short turnaround now.”
Despite such challenges, the Canopy by Hilton Jersey City remains focused on attracting these eleventh-hour bookings, targeting its marketing efforts toward demographics most likely to make last-minute plans, including those in nearby drive-in markets and locals planning staycations.
“Packages that include a portion of gas reimbursement and parking cost relief have been created, and there’s also a Dream Away promo that Hilton launched a few weeks ago that has given us a good boost in occupancy,” said Nabben.
In the Americas, Hilton’s Dream Away offer grants Hilton Honors members up to 20{143106009d8b87d45252e1fd973f0c0835ad3aabba3679e828c3cd83539ae06c} off as well as perks like early check-in and late checkout.
“When it comes to that compressed booking window, marketing is critical,” said TravelClick’s Moro. “Understanding that booking window in order to understand when to market can help drive occupancy, which is going to be key to success for hotels.”
A similar trend toward compressed booking windows has emerged in Europe. Accor CEO Sebastien Bazin told investors on the company’s Q2 earnings call in early August that around 60{143106009d8b87d45252e1fd973f0c0835ad3aabba3679e828c3cd83539ae06c} of all Accor bookings being made in Europe are for stays within the next five days.
“On Monday, people decide what they will do the following weekend or the following week,” said Bazin, adding that in 2019, the majority of Accor’s European bookings were made with at least 10 days’ notice.
In response, Accor has cut back on marketing at a global level, with around 90{143106009d8b87d45252e1fd973f0c0835ad3aabba3679e828c3cd83539ae06c} of the company’s marketing efforts now centered on domestic and local fronts. Additionally, Bazin reported that the group’s VeryChic flash-sale booking platform, which is based in Barcelona, has “never seen so much traction as over the last five or six weeks.”
Hyatt CEO Mark Hoplamazian noted, however, that shortened booking windows, combined with near-term group cancellations, have made it exceedingly difficult to make accurate recovery projections. On Hyatt’s Q2 earnings call on Aug. 4, he said that more than 65{143106009d8b87d45252e1fd973f0c0835ad3aabba3679e828c3cd83539ae06c} of the company’s full-service U.S. bookings and over 75{143106009d8b87d45252e1fd973f0c0835ad3aabba3679e828c3cd83539ae06c} of its select-service U.S. bookings are now being made only four days ahead of the date of stay.
“This is the shortest transient booking window we have seen,” Hoplamazian said. “All of this makes it challenging to forecast results or plan for demand levels.”