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Strategic Rate Management Boosts Booking, Occupancy, and Revenue for Winter Months at Southeastern Resorts

In response to a winter season that started in September with damaging hurricanes, destination and resort lodging properties throughout the Southeast lowered rates to attract visitors for the winter months of September through February—and it worked. According to data released yesterday by Inntopia in their monthly DestiMetrics* Market Briefing, consistent and moderate declines in rate have persisted since September and have helped drive double-digit occupancy growth for the third consecutive month.

For the month of January, actual occupancy was up a sharp 16 percent compared to last January while the Average Daily Rate (ADR) was down 4.3 percent. Despite the drop in rates, the surge in occupancy for the month delivered an aggregated 11.3 percent gain in revenues among participating properties. ADR for the season is down an aggregated 1.3 percent, but with strong occupancy, properties are posting a 10.8 percent increase in revenues in a year-over-year comparison to the winter of 2017-18.

“The strategy of sacrificing a bit of rate to help boost occupancy appears to be paying off across the region,” explained Tom Foley, vice president of Business Intelligence for Inntopia and author of the Briefing. “We are now seeing four consecutive months of notable revenue gains due to this strategy.  And, that same strategy is having long-term benefits looking forward, as declines in the booking pace over the past few months have reversed, and bookings for the summer months (March through August) are now on pace with expectations.”

Key economic indicators described in the Briefing are reviewed for their potential impact on leisure and recreational travel. Once again, the Dow Jones Industrial Average continued its meteoric rise in January by gaining more than 1,430 points in a single month for a 5.8 percent increase and setting an all-time Index high of 26,149.39 points for the largest monthly point gain on record. After a moderate dip last month, the Consumer Confidence Index (CCI) bounced back to post a 2.7 percent gain and the seventh consecutive month above the 120-point threshold and confirming strong consumer confidence. Employers added 200,00 new jobs in January, keeping the Unemployment Rate at 4.1 percent. This growth extends the unbroken streak of positive job creation that started in October 2010.  Employee wages increased slightly during the month but are still lagging well behind pre-recession levels.

The Briefing pointed out that investors reacted positively to both the strong consumer confidence and employment data. “Ironically, the strong economic news may trigger the Federal Reserve Bank to begin raising interest rates to help control inflation after nearly a decade of artificially low interest rates,” observed Foley.

With one more month of data yet to be tabulated for the winter season, the Southeast seems poised on the verge of setting a new benchmark for winter occupancy.

“Lowering rates to entice visitors is well known tactic for boosting revenues and the aggressive pricing that started back in September by many southeast destinations has been working very effectively. What makes the data so interesting this month is the uniformity of rate reduction across a widespread area from South Carolina to the Florida panhandle and Alabama’s coast,” continued Foley. “The results have been very positive for the Southeast and can be expected to continue as the economic boom continues and consumer confidence remains high,” he concluded.


DestiMetrics, part of the Business Intelligence platform for Stowe-based Inntopia, tracks resort performance in selected mountain and southeast U.S. destinations. They compile forward-looking reservation data each month and provide individualized and aggregated results to subscribers at participating resorts.

Data from southeastern destinations is derived from seven resort destinations including Hilton Head, SC; Golden Isles, GA; Florida Keys & Key West, FL; Osceola County (Kissimmee), FL; Okaloosa County, FL: Panama City Beach, FL; and Alabama Gulf Shores & Orange Beach, AL. Results may vary significantly among/between resorts and participating properties.

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