Travelodge pricing experiment

Weekly Newsletter An interesting experiment on selling hotel rooms is underway in Britain. Travelodge is now pricing all its hotel rooms at rates that start as low as £25/night, year round. Rates start at the lowest possible price, and then gradually move higher and higher, the closer to travel date the booking becomes.

My prediction? This is a stupid idea that won't work. This pricing is exactly the opposite of the level of desperation that the hotel feels to get your business. Six months in advance, the hotel doesn't really worry if you choose its room or not. But six weeks in advance, it starts to get a clear feeling for how many unsold rooms will remain, and six nights (or six hours) in advance, it very definitely is staring at the worry of empty rooms.

Websites like www.lastminute.com have responded by contracting with hotels and offering very inexpensive rates on rooms that hotels think will remain unsold, and which are only offered for sale in the last three weeks until travel.

Of course Travelodge would love you to commit for their rooms as early as possible. But it doubly wants/needs your business when it is staring at the virtual certainty of the rooms otherwise going unsold. Accordingly, I don't expect this new pricing model to last long.