The economic fallout of 2020 undoubtedly drove many hotels to lower their prices in an effort to stimulate demand.

But as the industry prepares to capture the pent-up travel demand, lowering prices could cost Hoteliers a significant level of business in the post-covid travel boom on the horizon.

History and research suggest hotels that hold the line on price tend to recover faster from recession. In cooperation with the Center for Hospitality Research at Cornell University and Smith Travel Research (STR), researchers explored pricing behavior using 67,008 hotel observations over a seven-year period, from 2001 through 2007.

The results showed that RevPAR gains came to those who priced above competitors, while those who priced below suffered significant revenue losses.

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