Minority of Hotel Properties make 80%+ of the changes to prices.
You see the 80/20 principle everyday in life and business and hotel connectivity is no different.
Recently I had Andrew (CTO) add a new chart for me called the “State Change” which you can see above.
State change is when we get actual changes to our “state” which is availability or prices for a hotel.
It was interesting to see when prices or availability change, if you would look only at the updates we get you would get a totally different picture (see below)
If you look at this chart above with API calls you would think that we are constantly getting a lot of changes but the state change graph shows it not like that.
Why are there 2 times of major changes?
In the chart I highlighted 2 major times where there’s a lot of changes to prices.
- 12–1pm GMT (CET 1–2pm)
&
2. 8–10pm GMT (CET 9–11pm)
1st Peak at Midnight
If your in Hotel Tech I am sure you can guess the changes are down to full sync from PMS systems. We have many PMS send us a full 500+ days updates for all connected properties each night.
They mostly choose midnight for this “full sync”
I thought this also, in reality the full sync usually gives us duplicated data that we already had, so it should make a very low amount of state changes.
I dug a little deeper and found that it was down to currency changes in hotels that price in the local currency and the travel agents are in a different currency.
So the PMS would calculate all prices for the EUR or USD rate at midnight and sync the whole lot.
Most hotels around the world sell hotel rooms in their own currency (example Spanish hotels for Euro or British hotels in Pounds)
But a small amount have currencies the booking websites dont want to work with so the hotels have to use another.
Example: Iceland hotels have ISK currency but booking.com is in Euro
2nd Peak of Changes in the Morning
Ok so we figured out the night time changes was currency but what is the deal with morning changes?
Was it down to all the hoteliers waking up and changing their prices? I doubt all hotels would be changing prices so much each morning.
After some investigations and asking the PMS involved it was from automated systems (Revenue Management Systems)
Pretty obvious if you think about it, these systems want to reprice all the rooms and dates each day before the hotel starts work and not during the day where they saw one price and now it’s changed to another.
A very tiny amount of hotels use these automated systems (less than 1%) especially the non branded hotels.
Conclusion
80%+ of changes to hotels prices are from the minority of properties with auto currency changes or auto yielding services.
In the future it is predicted that many more hotels will start to use revenue management and yield management pricing tools. If this is correct then we will see a 10–100 times increase in traffic in the next few years.
