Despite a start of season below expectations, Spanish hotels in the main holiday destinations are not lowering prices.
Turkey’s recovery this last year places it as a strong competitor for Spain. Its main attraction, sun and beach, and its considerably cheaper accommodation prices, are causing a bookings outflow by the traditional source markets in Europe: United Kingdom and Germany, that register increases of more than 80% for some areas of the Turkish coast.
The growing concern of the Spanish hotel industry towards the slow season start and the low sales volume so far, has become these days the main topic of debate of the Spanish coast destinations.
An analysis elaborated by Mabrian Technologies through its Tourism Intelligence platform, analyses the impact of this situation on the prices offered by Spanish hotels in the country’s main holiday destinations for the high season. For this, the prices of 2,130 hotels offered in OTAs have been monitored, for stays between 15th June and 15th September searched three months in advance.
This platform registers and compares accommodation prices for a specific destination’s hotels, differentiating by categories and different advance sections in bookings (three months before, a month before, two weeks before, etc.). By doing so, they manage to establish a temporal price evolution in comparison to other destinations, and configure diversion alerts in order to help their clients react quickly to market changes. This information is also compared to the evolution of travel intention and searches for the destination, to enrich the analysis and support the pricing strategy and the RMS.
For the study, hotel prices have been taken for Costa Brava, Costa Blanca, the Balearic and Canary Islands, in comparison with Antalya and Marmaris, two of the most important coastal tourist areas of Turkey.
As can be clearly seen in the graphic comparison, hotels on the Turkish coast offer significantly lower average prices, with differences that reach up to 73% in the 3-star category, compared to the prices offered in the Balearic islands.
In terms of national destinations, the Balearic islands shows the highest prices in all categories, while the remaining destinations alternate their positions in the average prices ranking in each category. The 3-star category displays the most price disparity, showing differences of up to 50% between destinations such as the Canary and Balearic Islands.
With respect to 2017, no significant variation in the prices offered during the high season was detected in these Spanish destinations. This seems to indicate that hoteliers rely on recovering occupation without having to lower prices. In fact, 3-star hotels show an average increase of around 4%. 4-star establishments are stable (-0.5%), while the 5-star ones show more disparity, with an average fall of 3.67%.
To supplement the analysis, with the help of Mabrian’s platform, an analysis of the satisfaction towards hotel services in these destinations has also been carried out, through the analysis of over 429,744 hotel reviews from the main review portals (TripAdvisor and Booking) between 15th June 2017 and 15th June 2018.
The Hotel satisfaction Index (HSi) is obtained through the semantic analysis of the text in the reviews through Natural Language Processing and Artificial Intelligence techniques. These techniques extract the sentiment and measure the user’s satisfaction level with the hotel in general, and specifically with the different services that compose it.
By analysing this comparison we see how, despite the considerable differences in prices on offer, Turkish destinations offer very competitive satisfaction levels and, in some cases, higher than the leading Spanish destinations. It is only in the 5-star category that Spanish destinations show a competitive advantage.
This knowledge paired with the correct analysis of available data with the help of tools such as Mabrian’s, enable hoteliers and destination managers to monitor the market evolution in a global way, discover weaknesses and opportunities, and make operative and strategic decisions in an agile manner.