Expedia says packages are better for hotels than room-only

Hotels are achieving higher average daily rates (ADR) from consumers who book packages rather than just rooms, according to data from Expedia Group.

The online travel giant said consumers buying packages paid around 30% more in ADR than those making standalone hotel bookings.

The study further revealed that package buyers booked one month earlier on average than standalone customers, who were also 2.6 times more likely to cancel their reservation than package consumers. These findings were based on Expedia’s booking data for 2017 with package sales running into the “tens” of millions.

The research comes at a time when global hotel companies are focused on direct marketing to customers and encouraging them to book directly through their own websites and portals, rather than via online travel agencies and other third parties.

Expedia also looked at the top international source markets for package holidays to five key US destinations: New York City (Manhattan), Las Vegas, Orlando, Miami and Oahu in Hawaii.

Melissa Maher, SVP of marketing and innovation at Expedia Group, added:

What may be even more compelling is that these numbers are even higher when we look specifically at international package bookings.

“International package bookings averaged a more than 30% higher ADR, booking windows almost two months in advance of stay and even longer length of stay, with cancellations four times lower than standalone bookings.”

Manhattan had the highest level of package bookings for international visitors at 52%, followed by Oahu (29%) and Las Vegas (24%).

The UK was the top provider of international package bookings to Manhattan with a 33% share, while Canada was the top source market for Las Vegas, Orlando and Miami packages (59%, 40% and 31% respectively), and Japan had the most package bookings to Oahu (47%).

“Package bookings offer many benefits, to hotels and travellers, and to get the most value from packages, hotels should know their top origins markets, both domestically and abroad,” added Maher.

“You can then look at the specific bookings habits that each origin brings: do they tend to book five-star or three-star? Prefer beach or city properties? Are they sightseers, shoppers or both?”

Expedia added that hotels should offer “origin-specific” deals and promotions, monitor exchange rates in their top source markets, as well as knowing the key booking and travel periods for different international markets, such as during “Golden Week” in October for Chinese holidaymakers.


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