TMCnet News
Yapta Study of Corporate Airfare and Hotel Prices Suggests That Supplier Negotiations May Be a Waste of TimeYapta, the leading provider of airfare and hotel price tracking services, today published the findings from its fourth annual study examining the behavior of corporate airfare and hotel prices, revealing alarming data on the performance of negotiated travel rates against spot pricing. The study was based on the observation of over 5 million travel itineraries, equating to approximately $3.7 billion in spend by large and mid-sized corporations, and was conducted using FareIQ, Yapta's (News - Alert) airfare price tracking solution, and RoomIQ, Yapta's hotel price tracking solution, over a 12-month period ending April 30, 2017. "The results of this study revealed a number of interesting data points, but the insight on the performance of negotiated rates and fares, when compared to public rates and fares, is certainly intriguing," said James Filsinger, President and CEO of Yapta. "The findings bring into question why corporate travel managers endure the lengthy, time-consuming, and cumbersome RFP process when dynamic, publicly available pricing undermines those efforts." Yapta's data showed that hoteliers are offering public rates that are lower than negotiated rates on a statistically significant number of occasions. The data on the top four largest hotel chains - Marriott, Hilton, Starwood and Intercontinental Hotel Group (IHG) - reveals that they are making their public rates available nearly half as often as when a negotiated rate beats a public rate, coupled with similar savings opportunities. For companies tracking these prices the savings opportunity was significant, ranging from $96 to $170 per stay for lower negotiated rates, and $87 to $132 on lower public rates. Yapta's comparison of corporate negotiated fares to public fares on three of the largest carriers in the United States - American Airlines, Delta Airlines and United Airlines - also had telling results. The negotiated fares on American Airlines beat its public fares 10% of the time, while on United that occurred only 6% of the time, and on Delta just 2% of the time. In instances when a lower negotiated fare was originally booked, a publicly avilable fare becomes available on American Airlines 6% of the time, and 5% of the time on both Delta and United. It could be concluded that Delta's negotiated fares rarely beat out its public fares, and its public fares beat its negotiated fares nearly three-times as often. Other key findings from the study include:
Kimpton and W Hotels are the most volatile brands, with Hyatt Regency, Westin and Le Meridien rounding out the top 10. This year's top 10 list has a much broader mix of chains, while past years have been dominated by Starwood and Hyatt.
The analysis revealed that for hotels booked in May, there is a significantly higher probability that a price drop will occur, and for the travel month of November, prices exhibit lesser volatility. The top three cities with the greatest hotel price volatility are London, San Francisco, and New York.
Virgin Atlantic Airlines is the carrier with the highest level of price volatility, followed by Singapore Airlines and Cathay Pacific Airlines. For the first time since Yapta has produced its annual White Paper (News - Alert), neither British Airways, Lufthansa, nor American Airlines appear in the top 10.
Contrary to most thinking, Yapta found that, on average, air ticket prices drop the closer to the departure date. The data shows that 29% of airlines' price drops occur 21 days or more in advance, dropping to 16% in the 15-21 day advance purchase timeframe, followed by an increase to 27% 8-14 days prior to departure, then returning to 29% within one week of departure. The study also examined:
Companies adopting FareIQ see an opportunity to save on more than 11 percent of all air travel itineraries, with an average identified savings of $260 per ticket. Any savings identified by FareIQ on behalf of its customers are over and above any airline imposed change fees and agency re-booking fees, ensuring customers see true value to their bottom line. RoomIQ dynamically monitors U.S. domestic and international hotel bookings, looking for rate reductions at the same hotel. Once a savings opportunity has been identified, RoomIQ then issues an alert in the local currency. Companies utilizing RoomIQ are seeing an opportunity to save on approximately 12 percent of all hotel bookings tracked - with an average savings of $109 per booking. Overall, RoomIQ has helped these companies lower their ADR by 4.7 percent. As the only company that provides total trip price assurance, Yapta has delivered more than $80 million in airfare and hotel savings to companies around the world. On average, companies see a combined savings of $369 per trip by tracking both airfare and hotel prices together with Yapta. For more information about Yapta's airfare and hotel price tracking technology or to download a copy of the latest whitepaper, please visit www.yapta.com.
About Yapta
View source version on businesswire.com: http://www.businesswire.com/news/home/20170807005143/en/ |
