Hotels have recalculated discounts

Hoteliers have revised their pricing policy for the summer season of 2023, becoming less likely to resort to discounts and promotions for early bookings. Relative to 2019, the number of hotels operating with such offers has decreased by two to three times. Some market participants explain the situation with low booking depth and difficulties with forecasting. And it is possible that hotels are counting on a successful summer season, which will allow them to sell rooms at full price.

Hotels have become less likely to resort to early booking promotions, which involve the sale of rooms in the winter for the spring-summer season at a discount. This was told to Kommersant by the director of the B2B direction of Ostrovok.ru Daria Kochetkova. According to her, hotels this year prefer to load standard rates for the next season. Tvil.ru representative Oksana Shustikova also drew attention to the decrease in the number of early booking shares. Sergey Romashkin, general director of the Dolphin tour operator, says that the number of hotels offering such programs is now two to three times less than before the COVID-19 pandemic. There are fewer proposals, and some objects, in principle, do not draw up proposals for the summer in a separate action, says Oksana Bulakh, commercial director of Alean.

Early booking promotions on the tourist market traditionally start in November. They allow tourists to save money, and hotel owners to get a load in advance, says Daria Kochetkova. Vadim Prasov, Vice-President of the Federation of Restaurateurs and Hoteliers of Russia, points out that hotels mainly provide discounts for early bookings in case of direct sales or if the tour operator has a rigid block of places (strict contractual obligations for the sale and payment of rooms). Mr. Prasov calls this tool important in determining the depth of bookings. According to him, up to 50% of rooms are traditionally sold this way. The interlocutor of Kommersant in the hotel market estimates the average size of discounts at 10-20%, adding that we can talk about 40%. A spokesperson for Krasnaya Polyana says the 10% discount for bookings for a month or more is still offered throughout the year.

Daria Kochetkova links the changed strategy of accommodation facilities with the difficulties of planning in a period of instability. According to her, it is difficult for hoteliers to predict costs, taking into account changes in prices for services, food, etc., and there are also restrictions on air travel with resort regions. According to Ms. Kochetkova, hotels rely on ensuring the current load by offering discounts for local residents. There are similar programs in hotels in the Crimea and the Krasnodar Territory, she said.

According to Oksana Shustikova, in a personal conversation, hoteliers say that they see no point in such promotions because of the difficulties Russians have with vacation planning. Some objects offer discounts, but only with a full non-refundable prepayment, she points out. Promotions are based on the dynamics of demand and sales, and now the depth of bookings is small, adds Oksana Bulakh. According to Yandex.Travel, the number of early bookings for flights within Russia decreased by 48% year-on-year.

Sergey Romashkin believes that the policy of hoteliers can also be explained by the expectations of a successful summer season. “It doesn’t make sense for hotels to sell places cheaper now if they can sell them for full price later,” he says. NF Group partner Olga Shirokova also believes that the lack of discounts for early bookings may be due to the high occupancy rate last summer. In 2023, hotels in Russia, in her opinion, will also be in demand.

Tour operators operating in the domestic market have not refused discounts for early bookings. Alean keeps the promotion with a 20% discount, says Oksana Bulakh. Sergey Romashkin notes that the average commission of a tour operator when booking accommodation on the domestic market is 17–18%, which allows discounts of up to 15%. According to him, such actions have become traditional and important for communication with customers. If a tourist manages to combine a tour operator’s discount with a hotel discount or a carrier’s sale, the benefit of early booking a tour can reach 30-40%, says Mr. Romashkin.

Alexandra Mertsalova