To gain a year-over-year perspective of how hotel industry average daily room rates performed in 2001, Pegasus Solutions evaluated electronic reservations transaction data representing hotel bookings made through the GDS and via the Internet for actual guest stays in 2001 and 2000.
Average Daily Rate by Electronic Channel
* GDS: For hotel reservations made through the GDS channel for guest stays in 2001, average daily rate (ADR) declined $1 to settle at $130, slightly down from an ADR of $131 for hotel bookings in 2000.
* Internet: The ADR for room reservations booked via the Internet for 2001 guest stays fell 11 percent or $12 to an ADR of $96, significantly lower than the ADR of $108 that occurred in 2000.
The ADR rate gap between the two electronic distribution channels experienced notable movement of nearly 48 percent in 2001. The variance in rates widened to $34, or an increase of $11 over the rate gap of $23 in 2000.
Room-rate Range Performance GDS vs. Internet
* GDS: For analysis purposes, Pegasus categorized analyzed ADRs in terms of rate ranges of $50 or less, $51 - $100, $101 - $150, $151 - $200, $201 - $250, $251 - $300, and $300 and up. Consistent with the performance of travel in 2000, the $51 - $100 room-rate range was the most popular price category with travelers whose hotel reservations for 2001 arrivals were made through the GDS channel. In addition, the $77 ADR for the $51 - $100 rate segment remained steady. The second most popular rate category was $101 - $150 with an ADR of $124, which was consistent with the previous year`s outcome.
* Internet: For the Internet channel, the $51 - $100 rate category dominated guest stays in 2001, as it did in 2000. This room-rate segment had an ADR of $74, mirroring that of the previous year. As with the GDS channel, the $101 - $150 rate range secured the position as the second most popular room-rate range booked via the Internet by travelers. For this rate category, the ADR of $123 saw no movement over 2000. Worth noting, the Internet channel`s ADR of $417 for the $301 and above price segment surpassed the GDS channel`s ADR by $7 for the same rate band.
Web Sites` ADR Performance Snapshot
To gauge room-rate outcomes by type of Internet channel, Pegasus took a closer look at aggregate hotel bookings made in 2001 and 2000 via various types of Web sites.
* Hotel-branded Web Sites: With a significant year-over-year decline in ADR of nearly 21 percent, proprietary hotel-branded sites experienced a drop in price segment, moving from the $101 - $150 ADR rate band to the high end of the $51 - $100 range.
* Discount Sites (opaque): Still apparent in 2001 was the trend of discount sites selling rooms at rates at about 35 to 40 percent lower than those booked on hotel single-brand sites. In 2001, the ADR of discount sites fell about 12 percent, settling at the low end of the $51 - $100 price category.
* Group/Convention Sites: Of the Web site-related bookings studied by Pegasus, the group/convention business was the only Internet channel to realize positive year-over-year movement in price. The ADR for online hotel reservations in this segment grew more than 10 percent over 2000 and occupied the high end of the $101 - $150 price category. This may be in part attributable to the growing acceptance of this booking mechanism, which was evident in the increase in reservations volume seen on group/convention sites analyzed by Pegasus.
* Major Third-party Sites (selected sites with annual reservations volume greater than 20,000): The ADR on leading third-party online travel agency sites was down nearly 7 percent, but was in line with the average room rate booked on hotel-branded sites in 2001, which was in the high end of the $51 - $100 range.
* Minor Third-party Sites (selected sites with annual reservations volume less than 20,000): Although minor third-party Web sites experienced only a 5 percent decline in ADR, the average room rate booked on this type of site was nearly 34 percent higher than that of the major third-party sites and fell in the middle of the $101 - $150 price category.
The travel snapshot was conducted by Pegasus Solutions and is based on cleansing and analysis of electronic reservations transaction data that was captured from thousands of Internet hotel reservations booked around the world through thousands of travel-related Web sites whose online hotel reservations are Powered by Pegasus, as well as from thousands of electronic GDS hotel bookings that are processed through the Pegasus Electronic Distribution System. The GDS bookings originated from travel agents using GDSs such as Amadeus , Sabre , Galileo and Worldspan , or from Internet sites that are powered by GDSs. By being Powered by Pegasus, a Web site gains seamless access to the central reservations systems of nearly 200 hotel brands, providing online travelers with real-time rates, availability and booking capabilities with instant online confirmations.