Current business travel volume is about 30 percent of 2019 levels, and average daily hotel rates remain lower as well but are increasing, according to Tripbam's second-quarter market report. Global market hotel rates are up 10 percent month over month and are on pace to reach 2019 levels before year-end if they continue on that trajectory, according to Tripbam.
For travel buyers, "now is the time to hustle and get deals in place, or you could have a real challenge later this year," said Tripbam founder and CEO Steve Reynolds during a Thursday webinar reviewing the report's results. "I would say no later than the first quarter of next year, 2019 rates are here. In several markets, we're seeing rates higher than 2019."
Tripbam pulled hotel rate data for the report on June 20 and used a 12-month running average. For monthly comparisons, it used the prior 30-day period and the same period in 2019. Tripbam filtered out new clients and used only those that were in its system in 2019, to ensure a like-for-like comparison. The report data also is based on corporate transient bookings only, not leisure or group.
According to the report, the best available rate for June was down 29 percent from the same period in 2019, and booked rates were down 27 percent, but that is "changing rapidly." Global corporate booked rates rose 8 percent month over month.
"The trend line is steep, which means rates are going up, and I don't see anything in sight that will slow that down," Reynolds said. "It's another indication that revenue managers at hotels feel able to keep rates up because occupancy is getting higher."
Rate volatility was down from 18 percent in Tripbam's first-quarter report to 16 percent. The historical volatility average is 10 percent to 12 percent, Reynolds said, predicting it would "mellow out" around the fourth quarter of this year.
Tripbam in its prior report suggested corporate travelers were moving down hotel tiers, based on the makeup of the workforce that continued to travel during the pandemic, but that trend started to change during the second quarter.
"We're seeing a trend starting in January where 2.5- and 3-star markets were dropping and 4- and 5-star [bookings] are picking back up," Reynolds said.
When asked what the upcoming requests-for-proposals season will look like, Reynolds projected a climate like that of 2019, "because hoteliers are more motivated to negotiate deals with you rather than just you rolling over, because those 2019 discounts will start to be acceptable. They will provide value [to buyers] in the second half of the year, quite a bit of value in 2022."
The company expects to start the beta test of its expansion into air solutions in July, said Tripbam VP of air solutions Tim Nichols, industry data veteran and former EY global supplier leader for travel, meetings and events.
"We're excited to venture into the air category," Nichols said, adding that Tripbam intends to offer air reshopping, auditing, and benchmarking by the end of the year. "Sourcing will come in 2022."