Revenue Management

🎰 Blackstone acquired a 65% controlling interest in Great Wolf Resorts in 2019, which then had 18 resorts. As of 2022, with over $2 billion invested, the company operates 20 resorts with three in the pipeline. John Murphy, CEO since 2022, emphasizes an average daily rate of $300, with a similar on-site spend. In 2023, Great Wolf opened its largest lodge in Perryville, Md., boasting 700 suites and a 128,000-square-foot water park. Additional lodges in Naples, Fla., and Webster, Texas, are set to introduce a new design. Furthermore, a $300-million lodge is planned to open in Connecticut by mid-2024. Occupancy levels average around 80%, with direct bookings making up 90% of business. They've recently partnered with Hilton Grand Vacations, and Great Wolf Lodge Grand Mound and Pocono Mountains have undergone significant renovations totaling $165 million.

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✈️ TrEvolution Group recorded $639 million in gross bookings and over 510,000 airfare tickets sold between January and June 2024, a 20% year-over-year increase. Ticket sales to Italy grew by 99%, to India by 37%, the US by 24%, and Nigeria by 17%. Canada's flight purchases increased by 90%. 90% of air passengers flew Economy, and 11% flew Business. Round-trip tickets were 2.3 times more popular than one-way, with sales up by 13%. United, Turkish, Philippines, American, and Qatar Airways were top choices. Lufthansa and British Airways saw flight sales jump by 99% and 73.5%, respectively.

🏖️ Lastminute.com, a European tech travel company, revealed an increase in Gross Travel Value to €823.2 million, up 3% from H1 2023, and a 16% rise in revenues to €99.8 million. Gross Profit soared by 25% to €45.3 million. For January-June 2024, it led the fast-growing European travel segment, expanding into Iceland, Mexico, and Chile, while enhancing offerings with experiences and flexible options like deferred payments and insurance. CEO Luca Concone anticipates improved H2 performance with a new Ryanair partnership.

💰 NASHVILLE—STR and Tourism Economics adjusted their 2024-25 U.S. hotel forecast, with 2024 ADR gains downgraded by 0.1 percentage points, RevPAR steady at +2.0%, and occupancy upgraded by 0.2 percentage points. For 2025, occupancy growth projections increased by 0.2 percentage points; ADR and RevPAR forecasts remained at +2.0% and +2.6%, respectively. Economic factors may affect travel with slower growth expected in 2024 but moderate travel growth anticipated due to factors like strong household balance sheets. Midscale and economy hotels face challenges from fewer lower-income travelers, while high-income travel is constrained by increased outbound travel and a strong dollar. GOP and EBITDA margins are projected to improve slightly year over year, with 2025 labor costs forecasted to decrease, especially in upper-midscale chains, projected at $168 lower than luxury chains.

💰 IHG Hotels & Resorts reported 2024 half-year results with a +12% increase in operating profit and Adjusted EPS. Global RevPAR grew by +3.0%, while the Americas saw +1.7%, EMEAA +7.5%, and Greater China dipped -2.6%. The total gross revenue reached $16.1 billion, marking a +6% growth. IHG opened 18,000 rooms, leading to a global estate of 955,000 rooms across 6,430 hotels, and signed 57,100 new rooms (+67% YOY). A significant achievement was the $800 million share buyback program, already 47% completed by June 30, 2024, and an interim dividend increase of +10% to 53.2¢. With adjusted free cash flow at $132 million and a net debt increase of $510 million, IHG remains on track to return over $1 billion to shareholders in 2024.

📄 An audit of Excel spreadsheets revealed that nearly 90% have serious errors, with an average cell error rate of 5.2%. Hotel revenue management is particularly sensitive to these errors, where one misplaced decimal or extra zero can significantly impact forecasts and pricing decisions. Adopting an automated, cloud-based revenue management system enhances real-time data analysis and strategic decisions, moving beyond just historical data to include web activity, weather, air traffic, and reviews.

🏨 Hilton, facing higher capital costs, focuses on hotel growth through conversions, with half of Q2 openings from conversions, driven by Graduate Hotels addition and brands DoubleTree and Spark by Hilton. In Q2, Hilton added 22,400 rooms, netting 18,000 additional rooms, and achieved a net unit growth of 6.2%. Hilton launched Spark by Hilton in Europe, debuted in London, and expects full-year net unit growth of 7%-7.5%. Global RevPAR increased 3.5% in the quarter, with a notable 10% year-over-year growth in group RevPAR. U.S. RevPAR rose by 3%, Americas outside U.S. by 7%, Europe by 7%, and Middle East and Africa by 11%, while China's RevPAR fell by 5%. Hilton’s development pipeline reached a record 508,300 rooms, with 62,700 new rooms approved in Q2. Hilton's full-year 2024 RevPAR projection is a 2%-3% increase, with a Q2 net income of $422 million. Hilton also integrated nearly 400 Small Luxury Hotels of the World, accounting for an expected 18,000 rooms.