Predictive demand intelligence for hotels by Lighthouse

Predictive demand intelligence shows hotel groups and chains where demand is heading before bookings reach the property management system. Lighthouse is a hotel commercial platform used by 80,000+ properties, and this guide is for revenue and commercial leaders at hotel groups and chains. The guide explains what forward-looking search data is, how early flight and hotel searches signal demand, and how Lighthouse Pricing’s demand metric feeds Lighthouse Performance in your commercial tech stack.

Key takeaways

1. Forward-looking search data shows booking intent before reservations reach the property management system, giving revenue teams an earlier view of market demand.

2. Lighthouse research found a positive correlation between flight and hotel search volumes and hotel occupancy.

3. In Lighthouse research on Singapore in August 2022, flight search data showed demand building 145 days before the stay month and hotel search data 80 days before.

4. Lighthouse Pricing’s demand metric looks up to 365 days ahead and feeds the day-by-day view in Lighthouse Performance.

5. Lighthouse studies found that Lighthouse Pricing users see a 4.7% boost in yearly occupancy and 2.3% growth in yearly RevPAR.

What is forward-looking search data?

Forward-looking search data is information collected when consumers are in the inspiration phase of their journey, browsing different websites and online travel agencies (OTAs), searching for their perfect trip.

Good examples of these higher-funnel data sets are hotel and flight search patterns. These provide a sound understanding of booking intent to help you anticipate future market behavior, instead of waiting until guests have booked a room and using the data from your property management system (PMS) to inform your commercial decisions.

So, why wait for bookings when you can read demand signals early?

When you better understand booking intent for your market, you can build correlations to demand trends at your property - turning these initial search signals into revenue opportunities.

By quickly grasping pre-booking market demand you can make proactive decisions as you see demand shifts, taking advantage of potential revenue opportunities.

This sounds great, but I’m sure you’re wondering, just how reliable is forward-looking search data when predicting demand at your hotel?

How reliable is forward-looking search data for predicting hotel demand?

Lighthouse research found a positive correlation between flight and hotel search data, and hotel occupancy.

How early can flight and hotel searches signal demand?

By evaluating daily, weekly and monthly hotel performance against flight and hotel search data, Lighthouse research found that high flight and hotel search volumes translate into high levels of market demand. This then results in increased hotel occupancy in the specified market.

Lighthouse research also examined how early flight and hotel searches show signs of demand. Flight and hotel searches occur days, weeks, or even months before hotels begin to see any pickup in reservations.

In the same research, Lighthouse Pricing recorded the following for stays in Singapore in August 2022:

Hotels in Singapore that saw bookings made for August 2022, in the same month, could see demand picking up 145 days earlier in flight search data and 80 days earlier in hotel search data in Lighthouse Pricing.

As you can see, access to forward-looking search data provides you with an extended window to shape your commercial strategy, much before your compset.

These new data points are easy to understand but difficult for you to manually collate and analyze. That’s why a predictive market intelligence solution, like Lighthouse Pricing, does the hard work for you, turning forward-looking search data into a way to act before your competition can.

How does Lighthouse Pricing predict demand?

Lighthouse Pricing includes a predictive market intelligence solution featuring a combination of forward-looking data sources.

From real-time OTA and metasearch data to flight search trends, events, and alternative lodging insights, Lighthouse Pricing aggregates an up-to-date picture of booking intent and future travel demand.

How does it work?

The unique AI technology processes billions of data points per destination, transforming raw data into real-time demand levels, all broken down by sub-location, stay pattern, and hotel types.

This is provided to you in the form of simple and actionable insights, available

from one centralized dashboard - along with instant alerts so you can take action and capitalize immediately on market opportunities.

What does it change for revenue teams?

With Lighthouse Pricing, you'll spot opportunities before your competition. By quickly grasping pre-booking market demand at your hotel you can take advantage of potential revenue opportunities as demand shifts, before your compset, with the right pricing and promotions, and targeted marketing strategies.

Not only can you improve your forecasting accuracy and speed up your forecasting time to decision; but with knowledge of insights like average length-of-stay and destination origin you can:

• Optimize budgets

• Deliver improved ROI and increased revenue

• Create personalized advertising for markets where you know demand exists

• Drive direct bookings with targeted marketing for brand.com

• Perfect your pricing and promotions depending on demand conditions

You can take this a step further by integrating these actionable insights with other revenue management solutions such as a rate shopper or business intelligence solution.

This integrated approach opens up new possibilities to drive business growth.

How does predictive demand data fit with the rest of your tech stack?

By examining what potential travelers are searching for, rather than focusing on what they have already booked offers valuable insights into emerging demand. Combining the ability to forecast demand trends up to 365 days ahead with other tools in your hotel’s tech stack creates a powerful synergy that expands your revenue management capabilities.

This is most evident when paired with a solid rate shopping solution as included in Lighthouse Pricing.

Lighthouse Pricing: Your revenue advantage

When real-time rate intelligence meets predictive demand data, you gain a competitive edge.You can set room prices that precisely match true market demand, while your compset are trying to piece together forecasts and pricing strategies.

What does real-time rate intelligence add?

Rate shopping tools, like what Lighthouse Pricing offers, gives you access to the current, past, and future rates of your competitors (including short-term rentals) across all distribution channels, in real-time.

This means you can make well-informed, data-based pricing and promotional decisions to capture all available revenue opportunities.

How does the demand metric extend to 365 days?

Lighthouse Pricing's demand metric already gives you a 60-day view into the future. But combine that with wider market data, and you unlock something more powerful.

When combined, you’ll have a more granular data set at your disposal, so the precision and reliability of Lighthouse Pricing’s demand metric is greatly improved.

Not only that, but your demand metric is increased to a 365-day view into the future. This extends the window of opportunity to craft your pricing and promotional strategy to capture demand far ahead of your market competitors.

The end result? Instead of just reacting to market dynamics, you're proactively making data-driven decisions to capture revenue opportunities before your competition.

How does Lighthouse Performance use the demand metric?

Market dynamics never stop evolving and your commercial strategy shouldn't either.

As market conditions fluctuate, it's essential for you to not only have a well constructed commercial strategy in place but also to ensure it is flexible enough to adapt to changing dynamics.

One platform. Complete clarity

With the right technology at your side, you can continuously monitor, adjust, and optimize this strategy to drive better business outcomes. Lighthouse Performance centralizes your commercial data into a single, dynamic view.

By drawing from your PMS, Lighthouse Performance centralizes all your commercial data on a single, dynamic platform. From a quick glance at top performance metrics to deep strategic dives, the entire commercial team, from revenue to sales has all the data they need for performance assessment and decision making.

Power up with predictive intelligence

Now add Lighthouse Pricing's forward looking demand data into the mix and your commercial teams have a powerful combination to strategically drive business performance. All your commercial data, historical and predictive, working together to drive better business outcomes.

Lighthouse Pricing's demand metric flows into Lighthouse Performance’s Day-by-Day view, in the strategy tab, so you can see pinpoint market demand predictions next to data sets such as hurdle rate, best available rates (BAR), on-the-books (OTB), revenue and competitor rates to drive better decision making.

Turning insights into action: A practical example

Let’s look at a quick example. You see that OTB is low, as is your pickup and compset rates. If you then see that your forward looking demand indicator is also low, you can be confident that you are looking at a low-demand period and can price and market your property accordingly.

Some of the most critical business decisions are made in this tab and now you will be even better informed with demand metrics up to 365 days into the future.

What results does predictive demand intelligence deliver?

Lighthouse Pricing extends the window of opportunity for you to convert bookings. By collecting, analyzing, and displaying live forward-looking data in real-time, you can:

• Monitor market demand for the next 365 days, spot opportunities before competitors, and sell at the best possible price

• Address guests with targeted offers matching their segment, source market, dates, and desired length of stay

• Have real-time market data at hand to proactively maximize every demand change, while avoiding leaving money on the table when markets suddenly shift

• Collaborate better with sales and marketing teams by sharing relevant data to create targeted promotions and sales goals, ensuring the overall commercial strategy is aligned.

Quality data is central to understanding market dynamics. With Lighthouse Pricing you have access to extensive market data which is distilled into actionable demand insights at the click of a button - so you can make confident revenue decisions.

While historical data still has its place, post-pandemic booking behavior and an increasingly competitive market have shown that to forge ahead of your compset, your demand forecasting needs to evolve.

Demand forecasting should be the first step in your hotel's commercial strategy, and this begins with a predictive market intelligence solution. By better anticipating future demand, you can spot and take advantage of short, mid, and long-term revenue opportunities ahead of your competition.

No more guessing. No more waiting. No more missed opportunities. Just clear market signals driving confident decisions across your organization.

The results speak for themselves:

With Lighthouse Pricing, you can tackle all aspects of commercial strategy with focus and have confidence in your decision making be it pricing, distribution, or marketing.

Ready to transform your hotel's commercial performance? Contact us to discover the power of data-driven decisions.

Frequently asked questions about predictive demand intelligence

• What is forward-looking search data in hotel revenue management? Forward-looking search data is information from the inspiration phase of travel planning, when people search for hotels and flights before they book. It shows booking intent earlier than property management system data. Lighthouse Pricing combines these search signals with other sources to show forward-looking demand for a market.

• How far ahead should a hotel forecast demand? For most hotels, a 12-month forecast is enough, and forecasts become more accurate as arrival dates get closer. Lighthouse Pricing’s demand metric looks up to 365 days ahead, so teams can spot demand shifts early enough to adjust pricing and promotions.

• How does flight search data predict hotel demand? Flight searches show travelers planning trips months before they book hotels. In Lighthouse research on Singapore in August 2022, flight search data showed demand building 145 days before the stay month, and hotel search data 80 days before. Lighthouse also found a positive correlation between search volumes and hotel occupancy.

• How is predictive demand intelligence different from historical forecasting? Historical forecasting relies on past bookings, so it reacts after guests have booked. Predictive demand intelligence adds forward-looking search data, so teams see demand shifts earlier. Historical data still has its place, and Lighthouse Pricing works alongside the booking data in Lighthouse Performance.

• What does Lighthouse Pricing’s demand metric show? Lighthouse Pricing’s demand metric shows forward-looking demand levels for a market by date. On its own it gives a 60-day view, and combined with Lighthouse’s wider market data it extends to 365 days. It feeds Lighthouse Performance’s day-by-day view next to on-the-books and pickup data.