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IHG urging buyers to adopt dynamic hotel pricing

August 31, 2010 |

As hotel negotiations commence, InterContinental Hotels Group is urging large buyers to adopt dynamic pricing models for their 2011 hotel program, following a training and communication plan the global hotel company launched with its national sales team.

"We want to take dynamic pricing, put it in the proper box, wrap it up and put a bow on it," IHG senior vice president of worldwide sales Stephen Powell told Business Travel News. "This is about the large global accounts, and we're sitting down with our clients and having high-level conversations with them."

Powell said IHG's new approach includes a workbook and technology tool to show buyers potential value in accepting dynamic rates, a discount off the hotel's best available rate, rather than fixed negotiated rates. The sales team also is trying to address common buyer criticisms of dynamic pricing, such as the difficulty it presents in budgeting.

"In our value proposition, we think we can predict with greater accuracy because we have the history," he said. "It's what we're already doing, because with fixed rates, we're predicting what average daily rates are going to be in 2011. If we can get close to what we think ADR is going to be, it can help in future budgeting."

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