Business travellers opt for earlier hotel bookings, study finds

Data from more than million hotel reservations has revealed a trend towards earlier booking times among business travellers.

HotelHub, a provider of hotel technology solutions for travel management companies (TMCs), reported an increase in booking lead times for business travel. During the final quarter of 2024, the average lead time reached 17.35 days, reflecting a rise of nearly 7% from the same period in 2023. The overall average lead time for the year 2024 was 16.13 days, an increase of 9.88% compared to 14.68 days in 2023.

The report highlighted that the most significant rise in booking lead times was seen in domestic reservations, which grew by 11.54%, from an average of 12.91 days in 2023 to 14.4 days in 2024. This shift aligns with stricter travel-approval processes as businesses navigate economic uncertainties. Fewer last-minute trips are being booked as companies aim to minimise costs and ensure travel is justified by business needs.

In terms of pricing, the global average nightly hotel rate for 2024 was $184, showing a 4.55% increase from $176 in 2023. Initial concerns over inflation impacted business travel rates, with a 7.92% rise noted in the first quarter of 2024 compared to the same quarter in 2023. However, by the fourth quarter of 2024, the rate of increase slowed to 3.91% over the previous year, indicating a potential stabilisation of costs as the year concluded.

Major centres of commerce continue to present higher-than-average rates, though increases have been slowing. London's hotel rates, the most popular destination for HotelHub users, increased by 8.7% in the first quarter of 2024 compared to the prior year. By the end of the fourth quarter, the increase was moderated to 6.7%, with rates moving from $311 per night in the fourth quarter of 2023 to $332 in 2024.

Contrastingly, New York, ranked as the third most popular destination, witnessed a decline in hotel rates during the latter half of the year, with a 2.2% decrease to $497 per night in the fourth quarter, compared to $508 the previous year.

HotelHub's findings also indicated a steady pattern in the average length of business stays, which has remained around 2.5 days since 2022. This is a reduction from pre-pandemic averages of about 3.5 days and points to a sustained impact of hybrid working models, aligning travel with when colleagues and clients are present in offices.

Paul Raymond, Director of Business Development at HotelHub, stated, "Following some turbulent years, the corporate world appeared to take a deep breath in 2024, waiting to see what would happen next. Our latest findings suggest that while businesses are continuing to travel despite the uncertainty, they are putting greater emphasis on the need to control and maintain comprehensive visibility of their hotel expenditures. If information is power, the ability to keep a close eye on travel spend can only lead to better decision making."

HotelHub remains a pivotal platform for TMCs, offering a comprehensive range of hotel booking tools that consolidate content, reporting, and payment processes for enhanced efficiency and data transparency.