Hotel pricing and promotional strategies in Europe


Capturing Travel Demand: Hotel Pricing and Promotional Strategies in Europe

OTA Insight;

Across Europe, forward-looking data paints a positive picture. Demand levels are higher than they have been since before the pandemic, and travel prospects are optimistic. Despite the uncertainty surrounding the ongoing war in Ukraine and the economic pinch leading to rising costs of living and rising inflation, travelers are desperate to make up for lost time, with increased travel in and around Europe from Europe.

As popular travel destinations in Europe emerge from months of uncertainty and cancellations, trends in the travel industry are beginning to emerge. In this article, we use OTA Insight’s Market Insight tool to examine demand trends and the Rate Insight tool to examine the evolution of destination pricing strategies across Europe, to see how hoteliers capture growing demand in 2022.

Southern European travel rebounds

In Southern Europe, non-refundable fares are back in force. Before the pandemic, non-refundable rates were a hotel’s daily bread – a cheaper price, and since most travelers aren’t likely to cancel, there was very little risk.

In Barcelona, ​​83% of hotels offered non-refundable rates before the pandemic, compared to 32% a year later in March 2021. And, since the end of 2021, the percentage of hotels offering non-refundable rates in Barcelona is increasing – 54 % of hotels in May 2022.

The same can be seen in other popular southern European destinations including Rome (89% pre-Covid, and now up to 57%, Venice (95% pre-Covid, and now up to 66%) , Lisbon (85% pre-Covid, and now rising to 61%) and Athens (92% pre-Covid, and now rising to 71%).

While hoteliers’ strategy has clearly been to encourage trust in times of uncertainty, it has evolved. Despite new variants, the outbreak of war in Ukraine and continued market volatility, more and more hotels in Southern Europe are offering non-refundable rates. And, while more hotels were offering semi-flexible policies than before the pandemic, the percentage of hotels offering this in 2022 has also declined.

However, following sudden downturns, such as the arrival of Omicron and the outbreak of war in Ukraine, short-term increases in the percentage of hotels with semi-flexible policies can be identified. As soon as market uncertainty kicks in, hotels keep this tactic in play.

Evolution of non-refundable and semi-flexible fares, Rome


Hotel discount strategies are changing

Mobile discounts are also important in the Southern European market – popular destinations in Greece and Portugal have used them as part of their mix of pricing strategies during the pandemic.

In Athens, 30% of hotels offer between 5 and 10%, and 8% of hotels offer a discount greater than 10%. In Lisbon, 31% of hotels offer a discount of between 5 and 10%. In Santorini, 46% of hotels offered a rolling discount of between 5 and 10% in January, but this was reduced to just 26% of hotels offering this discount in May – a clear indication that demand and conversions have increased over time. of the year. has progressed.

Length of stay (LOS) discounts have also declined in many of these popular destinations as summer approaches and hotels are looking to ensure they convert at the best possible price.

LOS3 reductions in January 2022


With demand up to 4.3 times higher (Rome) than the same period last year, hotels have been able to ensure they are maximizing their profits accordingly. In Rome, average room prices ten days before travel are 42.4% higher than they were in May 2019, before the pandemic, and 51% higher than they were in May 2021 .

In Barcelona, ​​where hotel searches indicate demand 4.15 times higher than the same time last year, prices are 114% higher than they were in May 2021 and 24% higher higher than in May 2019. In contrast, in Santorini, where forward-looking hotel search data indicates that demand has increased relatively slightly from where it was in May 2021, we can see that prices are still 26% below 2019 levels.

LOS3 reductions in May 2022


Travel demand is accelerating in France, Benelux and DACH

Forward-looking demand data indicates that a large number of consumers are exploring travel options to cities in and around Western Europe. Demand has increased significantly compared to the same period last year. For Berlin, up to 6.6 times more hotel searches were recorded than in May 2021.

Business travel also appears to be picking up, with business hubs such as Brussels and Geneva seeing 12 times more Global Distribution System (GDS) search traffic compared to May 2021. While hotels in these cities are looking to take advantage of growing demand, we can see that non-refundable options are coming back into the mix.

This option means growing consumer confidence and a return to market stability in the short to medium term, as more and more European countries opt for an open-door policy by removing travel restrictions. In Brussels, where 46% of hotels offered a non-refundable rate in May 2021, 72% offer non-refundable rates in May 2022. In Paris, 70% of hotels have a non-refundable rate, compared to 41% in May 2021.

GDS pickup since May 2021


On the other hand, the percentage of hotels offering a semi-flexible option has returned to what it was before the pandemic. In Amsterdam, only 9% of properties have a semi-flexible option, down from 22% in May 2021.

For much of 2021, 22% of hotels offered a semi-flexible option, rising to 42% when the Omicron variant led to a strict lockdown in November 2021. But, following the easing of these restrictions, we found that ‘As of March 2022, the semi-flexible option has become much less common.

A similar trend can be observed in Germany, Switzerland, Belgium and Austria. In Geneva, 44% of hotels had a semi-flex option in February 2022; 11% only 3 months later. France is an exception. In Paris, 35% of hotels still offer semi-flexible rates, and in Bordeaux 40%, a figure that has remained constant since this option was imposed in 2020.

Evolution of the non-refundable and semi-flexible rate, Paris


As demand increases, hoteliers are less likely to offer incentives, including LOS discounts, if they are able to fill their inventory at a better price. In Amsterdam, 38% of hotels offered a LOS3 discount in January; in May, only 11% offer this.

In Paris, we saw the same discount fall from being part of the pricing strategy in 35% of hotels in January, to less than 5% in May.

While some discounts are shrinking, mobile discounts in some of Europe’s biggest cities have remained a constant feature of hotel pricing strategies. With many properties competing for OTA visibility and looking to capitalize on pent-up consumer travel demand, the mobile booking discount encourages consumers to book as soon as they see the promotion, rather than waiting to book later. on a computer.

Booking convenience is key, and while international travel from the Americas and Asia has yet to make a comeback, the source markets for all of these destinations remain overwhelmingly European – who are ready and eager to travel this summer.

Using mobile discounts in May 2022

Mobile discounts May 2022

With summer fast approaching, prices are starting to reflect a busy holiday season. The early months of 2022 saw prices slightly below 2019 levels, but as demand picks up we are starting to see prices reflect this.

In April, Munich was 38% lower than it was in 2019. In May, Munich is priced 7% higher than in 2019. Paris hotels are 31% more expensive in May than they are were in May 2019. Geneva, Zurich and Brussels are still priced slightly lower than they were in 2019.

Price data, however, shows that prices are trending higher, and despite weaker demand in 2021, prices in 2022 are significantly higher than they were a year ago. The average price of a hotel in Amsterdam in May is 109% higher than it was in May 2021, 80% higher in Berlin and 67% higher in Paris. Geneva is 60% higher than in May last year, while Brussels is 30% higher and Zurich 23%.

Price comparison 2022 v 2019



Seeing demand is one thing, especially if the forward-looking indicators paint a rosy picture for most of Europe this summer. As hotels seek to ensure they convert this demand with innovative marketing strategies, it is also important that they sell their rooms at the right price.

To do this, you need to be nimble enough to adjust your strategies when indicators point to new opportunities. Rate Insight, combined with Market Insight, is the ideal technology stack for any hotelier wishing to visualize new revenue opportunities and benchmark their strategy against that of their competitors.

As Europe prepares for a summer of travel, hotels have the perfect opportunity to see positive results at a time when they need it most.

About OTA Insight

OTA Insight empowers hoteliers to make smarter revenue and distribution decisions with its suite of cloud-based business intelligence solutions, including Rate Insight, Parity Insight and Revenue Insight. With live updates, 24/7 support from our customer success team, and a highly intuitive and customizable dashboard, the OTA Insight platform integrates with other industry tools , including hotel property management systems, leading revenue management systems, and data benchmarking providers. OTA Insight’s team of international experts are based around the world including the UK, USA, France, Germany, Belgium, Spain, Italy, Brazil, Mexico, in Singapore, Australia and India, and supports over 40,000 properties in 168 countries. Ranked among the 10 “Ones to Watch” in the Sunday Times Tech Track 100, OTA Insight is widely recognized as a leader in hotel business intelligence.

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