Make dynamic rates work for your hotel program

Advito expert Alexis Sisko blogs about the shift to dynamic rates.

At last count, the number of solicited RFPs in 2021 equaled about half of the 2020 amount. Advito managing consultant Alexis Sisko noticed that dynamic rates increased notably for the same time. In 2020, accepted dynamic rates accounted for 8% of hotel programs; in 2021, it’s up to 13%. The change is good for the industry, Sisko says, but can be tough on travel managers. In a new blog, she advises travel teams on three ways they can get the most value from dynamic rates versus static rates. Her takeaways:

  1. Alexis Sisko, Advito

    Negotiate evergreen dynamic rates and include cap values: Add caps to dynamically negotiated hotel rates to alleviate concerns around hotel rate fluctuations. Along with negotiating the percent discount for the dynamic rate, establish a “cap value.” If the hotel’s standard rate ever rises enough that even the dynamic rate is higher than that cap value, the cap value becomes the negotiated rate instead.

  2. Achieve transparency with dynamic rate auditing: Once you have evergreen dynamic rates that include cap values, use dynamic rate auditing to hold hotels accountable for delivering the savings.
  3. Make corrections for failed hotel rate audits: With your partners, set and/or standardize parameters for all dynamic rates to prevent hotels using inaccurate or non-standard descriptions for dynamic rate pricing, e.g., BAR vs BAR with breakfast.

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Interested in learning more? Make an appointment to understand how Advito can help you right-size your hotel program.

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