Pre-COVID, corporate travelers accounted for 75 percent of the hotel industry’s profits.
Those national and international road warriors are returning but slowly, with major corporations’ jaunts in 2022 reaching 61 percent of their 2019 levels, according to American Express.
Meanwhile, business travelers from small and mid-size companies making more localized trips are booking at 80 percent of their 2019 level and have made themselves a growth center for major hotel chains.
In 2022, more than 60 percent of Hilton inns’ business guests drove to their hotels instead of flying, the company said, indicating a jump in more localized business trips.
Choice Hotels International has seen business contracts jump 52 percent compared to 2019, CEO Pat Pacious said to The Wall Street Journal.
In 2017, Choice began targeting companies with more modest travel budgets. In 2018, the company bought WoodSpring Suites, which caters to business travelers with limited expense allowances.
It also plans to add another 21 hotels to its EverHome Suites chain, which markets to those same smaller and mid-size enterprises.
However, the hotel industry is not neglecting people out for a good time.
The itch to travel for pleasure that was unscratched during 2020 and much of 2021 has pushed average nightly resort rates to a record $278.58, according to hospitality research service STR.
TREND FORECAST: We maintain our forecast made at the beginning of the COVID War that the days of major corporations fielding a cadre of reps constantly traveling around the world are over.
Teleconferencing is the norm now; so are budget-conscious executives. Major national and international business travel will never again be the norm and instead will be reserved for special deals, clients, or circumstances. The facts don’t lie. With office occupancy rates in New York city at 47 percent, for example, there is clear proof that business people are not traveling to the city that used to never sleep. And according to Kastle, among the 10 major cities in the U.S. office occupancy rate is around 50 percent.