In an unexpected twist for the global hotel industry, hotel prices are set to soar despite the anticipated dip in leisure travel for 2024. A comprehensive study by American Express Global Business Travel (Amex GBT), the pinnacle of B2B travel platforms, suggests we might be on the verge of a significant shift in global travel trends.
Diving deep into the intricacies of the business, Amex GBT’s “Hotel Monitor 2024” serves as a crystal ball, highlighting potential price surges in more than 80 global metropolises. This prediction is rooted in a detailed analysis of millions of hotel transactions and invaluable economic insights from the International Monetary Fund (IMF).
Snapshot of Predicted Hotel Rate Fluctuations:
- Chicago: +12.6%
- New York: +6.8%
- San Francisco: +6.2%
- Paris: +11.0%
- London: +9.1%
- Berlin: +9.4%
- Bengaluru: +11.1%
- Sydney: +4.9%
- Shanghai: +8.4%
- Singapore: +7.5%
The aftermath of the “revenge tourism” phenomenon in 2022 and 2023 is expected to fade. Instead, the rise in business travel, accompanied by meetings and events, will drive these rate surges.
A dynamic shift is apparent in the world of business travel. The modern work environment, characterized by flexibility and hybrid models, transforms travel patterns. There’s a noticeable tilt towards extended business trips combined with leisure — a testament to the evolving work-travel balance.
This metamorphosis is not going unnoticed. Global hotel conglomerates are in a race to amplify their extended stay packages. Meanwhile, vacation letting companies are evolving, too, witnessing a surge in demands for high-speed WiFi and flexible departure timings. This mirrors the inclining trend of business travellers opting for non-traditional lodging.
Inflation, though slowing down, is still a significant player in this game. The inflating operational costs, predominantly the skyrocketing wages, especially in the US, are changing the hotel industry’s foundational dynamics. This monetary evolution is compelling hoteliers to adapt, potentially disrupting the age-old correlation between price and demand.
As the leisure travel market cools off, a silver lining exists for corporations. The opportunity to strike favourable deals with hotels for 2024 has never been more golden. Simon Fishman, Vice President, Global Hotel, Amex GBT, articulates, “Now is the opportune moment to redefine a hotel program for the future. Our goal is to ensure every traveller gets a tailored experience. And our association ensures they get nothing short of the best service.”
The full report is available here for a detailed dive into these transformative trends and expert advice on maximizing accommodation value.
Written by: My Thanh Pham