Friday, June 14, 2024

January Bookings Up 15% As UK Hotel Demand Remains Strong

As the UK witnessed the ninth consecutive hike in interest rates from 3% to 3.5% at the end of 2022 (all within a twelve-month period), and the impact of inflation began hitting wallets, there was much speculation afoot about a global recession.

After enduring multiple periods of lock-down and without the freedom to travel, consumers have been making up for lost time, but the question on everyone’s mind is how a downturn might again impact the travel industry.

We take a look back at the last quarter of 2022 to see if interest in hotels remained strong amid the economic uncertainty and to make some predictions for 2023.

Cost-of-living crisis doesn’t dampen appetite for travel

Hotel Benchmark data for more than 250 UK hotels underscores continued consumer interest in hotels despite the cost-of-living crisis that threatened to dampen spend on travel at the end of last year.

Much of December 2022 hotel website data out-performed December 2019. Website sessions were up 11%, and while the number of transactions were down by 4%, the revenue booked on-line was up a massive 32% from 2019, suggesting that average transaction values were also up compared with 2019.

When looking at the whole of Q4 2022 data compared with the same quarter in 2019, the picture is very similar. Average website sessions for UK hotels over the last quarter of 2022 were 57,259, compared with 46,534, 23% higher. The same is true for website transactions/bookings which were 22% higher in Q4 2022 compared with the same period in 2019. Throughout the last quarter consumers were continuing to engage with hotel websites despite the cost-of-living crisis.

Not just lookers

And the good news is that it wasn’t just lookers. Hotel website revenue was up 64% in Q4 2022 on pre-pandemic across all hotel categories and a massive 99% for hotels in the 4- and 5-star category.

We can dissect the UK hotel data further into rural and urban performances. Urban hotels were the clear winners in the last quarter of 2022 when it came to hotel website revenues, 103% higher than their rural counterparts between October and December, with the trend looking very much set to continue into 2023.

Just one month into 2023, UK hotels continue to show strong performance with transactions up 15% and revenue up 20%, YoY.

Making money go further

So far, we see few signs that consumers are making adjustments in hotel categories booked. Throughout the last quarter of 2022, 5-star hotels continued to out-perform their 4-star counterparts with more website sessions, more transactions made on-line and higher revenues. UK 5-star hotels enjoyed average website revenues 220% higher than their 4-star counterparts in the month of December. This could in part be due to the fact that consumers are looking to shorten the length of their trips versus switching to a lower category of accommodation or opt to travel out of season to make the most of off-peak hotel rates.

Embrace mobile if you haven’t already

Pre-pandemic, 56% of consumers browsing UK hotels were using mobile devices.  Fast forward 24 months and mobile browsing now accounts for around 65% of total hotel website sessions and 39% of website transactions across all hotel categories (Q4 2022 vs. Q4 2019).

Looking at how mobile usage varied between different hotel categories, 4-star UK hotels edged in front of 5-star UK hotels in December. Mobile accounted for 69% of sessions and 46% of transactions compared with 67% sessions and 41% of transactions respectively for 5-star hotels.

Empowering hoteliers

Tools like Hotel Benchmark can help remove the guesswork from a hotel’s digital marketing performance and strategy by providing real-time data that compares your own hotel’s performance versus a market or competitor average.

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Hotel Speak
Hotel Speak
Hotel Speak provides actionable hotel marketing and revenue management strategies from hospitality industry experts.

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