Although just 22 percent of corporate travel managers have adopted dynamic pricing agreements, 100 percent of them would continue using them, finds a new survey of nearly 200 travel managers by the GBTA Foundation, the education and research arm of the Global Business Travel Association (GBTA).
Published yesterday, the survey explores the dynamic pricing model for lodging, whereby corporate travel customers agree to fluid rather than fixed prices, paying more or less for hotel rooms based on supply and demand in given markets. Among those who have adopted the model with at least one hotel, two-thirds said they're likely to adopt it with at least one additional hotel in 2015.
Dynamic pricing's biggest benefits, according to adopters, are cost savings (47 percent), access to more types of rooms (33 percent), and transparency of rates (25 percent).
"Dynamic pricing can allow corporate travelers to obtain a discount on rooms, particularly in a market where companies do not have sufficient volume to negotiate a set rate," GBTA Foundation Vice President of Research Joseph Bates said in a statement. "Our research finds, however, more education is needed to counter confusion and misconceptions about the dynamic pricing model."
Indeed, the study concluded that more education is needed to increase dynamic pricing adoption, particularly among travel managers from companies with a hotel spend of less than $5 million annually and low volume need.
"Travel managers with these companies represent an untapped market, as they stand to benefit the most from the dynamic pricing structure, yet are the least likely to have heard of dynamic pricing," the GBTA Foundation stated. "For companies that typically would not qualify for a corporate discount, dynamic pricing is an effective cost-saving tool."