Hotel revenue management in uncertain times: Expert Q&A on strategy, forecasting, and market shifts

From shifting traveler behaviors to economic fluctuations, the roadmap for setting the right price isn't as straightforward as it used to be.

But is uncertainty always a negative? Or can it be a catalyst for smarter, more agile strategies?

To understand how revenue teams can navigate – and even benefit from – this environment, we spoke with two Lighthouse revenue experts: Aditya Patel and Adam Dwiggins. Between them, they oversee more than 30 hotels across vastly different demand landscapes, from downtown San Francisco and Orlando to small roadside interstate properties.

What their combined experience shows is a simple truth: while uncertainty can be disruptive, it actually forces teams to build faster, creative, and more disciplined revenue strategies.

Key takeaways

1. Shorter booking windows and rising rate sensitivity mean revenue teams need sharper, data-driven pricing decisions.

2. Flexibility is vital: switching between an ADR-focused and occupancy-first approach depending on demand signals is essential.

3. Forward-looking data provides clarity in volatile markets, helping teams avoid reactive cuts and capture late pickup confidently.

What’s driving uncertainty in hotel revenue management today

Q: What are the biggest types of uncertainty hotels are facing right now, and how is it changing the approach to Revenue Management?

Two trends stand out across almost all of my properties: shorter booking windows and increased rate sensitivity.

These changes shift how uncertainty shows up in our data. For example, some hotels used to see summer pickup starting in November; now the meaningful bookings may not appear until 30–60 days out.

If a team compares today’s revenue pace to pre-pandemic trends, they can easily misinterpret the gap as weakening demand instead of recognizing it as a change in timing.

At the same time, guests are much more sensitive to small rate differences. Even a $10 reduction can meaningfully influence booking decisions, especially in local and domestic segments.

That forces revenue teams to be more precise, because small adjustments that used to be irrelevant now move real volume.

I’m seeing the same pattern, but with an added layer of economic and political uncertainty. Government-dependent markets, for instance, are experiencing slower travel due to shutdown risks and disruptions in federal business.

Guests are booking later and choosing flexible cancellation options far more often than non-refundable rates. That helps ADR, but it adds unpredictability to on-the-books numbers.

Combined with market-level demand drops in certain cities, it creates a situation where uncertainty isn’t isolated to one factor – it’s layered across rate plans, demand timing, and overall volume.

How to adjust revenue management strategy when demand signals conflict

Q: So when the market is sending you these mixed signals, how do you help hotels cut through the noise?

Adam:

Mixed signals are where teams tend to make their most reactionary decisions. So we start by grounding everything in relative performance, not absolute numbers.

If we’re down 10% year over year but the compset is down 20–40%, then we’re outperforming the market – even if the raw numbers look negative. That reframes the conversation away from panic and toward opportunity.

From there, we turn to the Lighthouse platform to identify the cause of the softer performance.

Are we slower in the transient segment only?

Is the group segment pacing down citywide?

Are competitors manipulating advanced-purchase rules?

By isolating the cause of the slowdown, we can respond strategically rather than broadly cutting rates.

This keeps the team focused on what the data supports, not what the pressure of the moment suggests.

Aditya:

Owners naturally gravitate to ADR, especially when they’re nervous, but during uncertainty, the real stabilizer is occupancy’s influence on RevPAR.

That’s why I rely heavily on market demand indicators in the Lighthouse platform. When demand is projected to be weak, the data supports small, proactive rate reductions. When demand will be strong – for example, before a citywide or major event – holding rate becomes the priority.

The data removes emotion from the decision. Even when the on-the-books position looks thin, if long-term pickup patterns and forecasted demand are strong, the correct move is often to stay the course instead of dropping $20 and triggering a cascade of unnecessary compression.

How traveler booking behavior and distribution strategies are changing

Q: Have you noticed specific trends in traveler behavior that are forcing a rethink of traditional strategies?

Aditya:

There is a fascinating paradox right now: travelers are highly rate-sensitive, yet they are reluctant to book the cheapest rates.

Flexibility has become a defining priority for guests. Even price-sensitive travelers are often willing to pay more to avoid a non-refundable booking.

That’s a reversal from 2022–2023 when non-refundable discounts produced strong room-night volume. Now, guests prefer control – and they’ll trade discounts for peace of mind.

At the same time, hotels are widening their distribution footprint. Instead of focusing on a few dominant OTAs, many properties now participate across a broader mix of channels to counteract unpredictability and maintain visibility.

It’s one of the clearest signs of how hotels are adapting: broader reach, more flexibility, and fewer assumptions about where demand will come from.

Adam:

Another major shift is happening in advanced-purchase (AP) behavior. Competitors in several of my markets are shortening their AP lead-time from seven days to as little as one day – but keeping the same heavy discounts.

They’re essentially using AP as a tactical lever to get guests to commit earlier without asking for long-term risk.

This means if you don’t monitor competitors’ lead-time rules in Rate Insight, you can lose share even if your BAR is competitive. It’s a new level of agility: teams must adjust not just rate, but rate-plan structure, and do it quickly.

On the distribution side, I’m also seeing much more reliance on wholesalers and FIT. These channels aren’t ideal for ADR, but in highly uncertain markets, hotels are using them as short-term stabilizers.

Q: From your hotel operations days, what’s something you learned during unpredictable periods that still shapes your decision-making today?

Adam:

For me, operations taught me to connect pricing decisions to real hotel constraints – room-type balance, upgrade flow, out-of-order rooms. When you understand the operational consequences of a rate cut or oversell, you price with more discipline.

I also wish I’d had tools like Rate Insight and BI’s room-type analysis earlier. They give a level of clarity that eliminates guesswork. You can see exactly which room types drive value, which sell out first, and where your upsell limits truly sit. That visibility is invaluable in unpredictable markets.

Aditya:

The biggest lesson is that sticking rigidly to ADR targets – or rigidly to occupancy targets – can hurt you. Uncertainty requires a dual approach: when demand is high, prioritize rate; when demand is soft, shift focus to occupancy to protect RevPAR.

That flexibility sounds simple, but many teams default to one mindset or the other.

When uncertainty disrupts normal patterns, the revenue manager who can switch modes without hesitation almost always outperforms the one who tries to defend a single metric.

Q: What technology tools do you wish you’d had during your early hotel career?

Aditya:

I wish I’d had forward-looking market demand data. In the past, we relied heavily on the STAR report, which is historical–it tells you what happened last week.

That doesn't help you when you're panicking about next month. Having a "heat map" of future demand allows you to see the storm coming and adjust, rather than just reacting to the damage after it happens.

Adam:

Rate Insight would have changed everything. When a guest asked for a discount at the desk, I would have known instantly whether that discount kept us competitive or undercut the market by too much.

The room-type module in BI is equally powerful. It lets you understand pricing power at a granular level: kings, queens, suites, singles. That helps avoid unnecessary upgrades, adjust upcharges, and protect ADR strategically – not emotionally.

Revenue management examples from volatile markets

Q: Can you share a real-life example where actively monitoring these shifts turned uncertainty into an opportunity?

Aditya:

Absolutely. One of the clearest examples comes from San Francisco, where major citywide conferences are a huge driver of demand – but booking behaviour around them has changed dramatically.

Historically, conference attendees would stay four to five nights, arriving Sunday and checking out Thursday. Recently, travellers have shortened their stays, often arriving late Sunday and leaving Wednesday.

That single-night contraction creates the illusion of weak demand if you look too early, because the old pacing patterns no longer apply.

During a recent citywide, our early pacing looked soft. A year ago, this would have caused immediate calls to drop rates. Instead, we relied on data:

Past years showed that pickup now happens much later.

Market Demand in Lighthouse BI showed strong compression closer to arrival.

Competitors were also holding rate – signalling confidence.

So we stayed the course. No pre-emptive rate cuts.

As the event approached, late pickup surged exactly as the data predicted. We ended up outperforming last year’s performance with an additional $50–$60 ADR, despite having initially looked behind.

In other words, what looked like a soft period was actually a change in guest behavior. By reading the shift correctly and holding rate, we turned that uncertainty into a meaningful rate premium.

A similar pattern played out in Texas at a hotel preparing for a major oil show. One week before the event, the hotel still had 40–45% of its rooms unsold – a scenario that would cause most teams to panic. But Benchmark and Rate Insight showed something crucial: competitors were rapidly filling up.

Instead of dropping rates, we held firm. As competitors sold out, spillover demand shifted our way, and we finished at 97% occupancy with higher ADR than the previous event year.

The key was trusting the real-time signals rather than reacting to the on-the-books number.

This is where uncertainty becomes an opportunity: you can outperform a reactive market simply by understanding how demand actually behaves today.

Adam:

A property I support in the Bay Area offers a clear example of how uncertainty can be turned into opportunity with the right discipline.

For years, the team had a habit of dropping rates too early, typically in the 7–14-day window before arrival. That early drop boosted occupancy, but it consistently eroded ADR because they were discounting before most guests were actually booking.

When we reviewed BI and Rate Insight together, we discovered that the hotel’s real demand window sat much closer to arrival – inside the final 0–7 days.

This meant the early discounting wasn’t just unnecessary; it was actively reducing revenue.

This year, we shifted the strategy:

• Hold rates through the 3–7-day window, where most demand naturally appears.

• Only flex inside 0–3 days, once same-week pickup trends were visible.

• Use Rate Insight to confirm that competitors weren’t undercutting us late.

• Use BI to validate that LOS and AP discounts were still converting without needing a BAR drop.

This disciplined approach kept occupancy steady while driving double-digit ADR growth every month, even though room nights were almost identical year-over-year.

It's not that uncertainty disappeared, but by correctly identifying the true booking window, the team stopped giving away ADR unnecessarily and started capturing the rate where demand was strongest.

What effective revenue leadership looks like in uncertain markets

Q: How do you approach forecasting for big, one-off events like the upcoming 2026 World Cup when there is no historical comparison?

Aditya:

The biggest risk is pushing too high too early. Without historical comparisons, you need to “test up” and watch for signs of traction. For example, set a high anchor rate, watch for movement, and adjust in controlled increments.

Large hotels might start building base earlier; smaller hotels can stay restrictive longer because they don’t need as much volume. The crucial thing is not assuming compression will save the day – you validate demand continuously and avoid overcommitting to an early rate position.

Adam:

There’s no clean comparison for a World Cup spread across the US, Canada, and Mexico. Qatar was too geographically concentrated; even Russia differs in seasonal patterns and travel behavior. So instead, we look at global trends: typical lead times, length of stay, cancellation patterns, and segment behavior from previous tournaments.

Most hotels in host cities haven’t opened rates yet – they’re waiting for the December 5th draw. The moment the first properties publish rates, the “market floor” appears, and strategy starts there.

Hotels must balance ambition with realism: cities like Dallas may not have as many rooms as seats in the stadium but you have to keep in mind Airbnb, Vrbo, and multiple people in one room.

You aren't likely to fill every single room for every single game due to these factors. You position high, monitor early movement, and be ready to adjust quickly.

Q: How are revenue teams adjusting strategies as macro uncertainty becomes a permanent part of the landscape?

Adam:

Distribution strategy is also evolving. Hotels are using more channels, more flexible rate plans, and more dynamic policy structures. And group base is becoming a foundational focus. When you secure base business, everything else becomes easier to manage. Without it, uncertainty magnifies every gap in pace.

Aditya:

Proactivity is replacing reactivity. Teams are learning that if they wait for pickup before making decisions, they’re already behind.

Shorter lead times force revenue managers to rely on forecast indicators rather than on-the-books alone. The ability to pivot – from ADR-focused to occupancy-focused and back again – is what's keeping hotels competitive.

Q: Has the role of the revenue manager changed – and what should great revenue leadership look like today?

Adam:

Great revenue leadership now requires flexibility, speed, and communication. You can’t take a rigid stance on rate strategy; you must adjust policies, lead times, and segmentation depending on demand signals.

You also need to hold frequent alignment checks with owners, sales, and operations – uncertainty magnifies if teams are not aligned.

Aditya:

Leaders must guide teams away from emotional decision-making. That means understanding when to push ADR and when to pivot to occupancy, and always grounding those decisions in market data.

And they need to help owners see that in down markets, “losing less than the compset” is still winning – because it means you’re capturing more than your fair share.

Q: And finally, in 2026, what’s the one piece of advice you’re giving hotels to stay competitive?

Aditya:

Be proactive and be flexible. Markets shift too quickly now to rely on outdated pacing patterns or wait for pickup to appear.

Revenue teams must monitor the market closely and make small, regular adjustments rather than big, reactive ones.

Adam:

Flexibility – and group base. A strong base stabilizes the entire revenue strategy, especially in unpredictable conditions. Without it, every soft day becomes a scramble. With it, teams can be deliberate, patient, and strategic.

That discipline will matter even more in a complex year like 2026.

FAQs

How do I avoid overreacting to slow pace when booking windows are shorter?

Short booking windows are now the norm in many markets – but not always a sign of weak demand. Look beyond same-time-last-year comparisons. Instead, use forward-looking data to understand current booking behaviour. Has demand shifted closer to arrival across your market? Is your compset also showing slower early pickup? The key is pairing pacing data with external demand signals before making rate moves.

When should I hold rate vs. when should I pivot?

Hold rate when you have reason to believe demand will materialise – especially if compset availability is dropping or your pace is consistent with previous years’ lead time trends. Pivot if market demand is low and there’s no positive compset signal. Always weigh current pickup velocity and external demand indicators together before making a rate move.

What’s the best way to manage owner expectations in volatile markets?

Frame conversations around market share, not just revenue. If your performance is better than the compset – even if absolute figures are down – you’re still gaining. Share pace vs. market data, demand trends, and competitor rate strategy to support your recommendations. Use data to make your decisions transparent and collaborative.

How should I adjust my forecasting process in an uncertain environment?

Ditch static annual forecasts. Move to rolling or scenario-based models (base, conservative, aggressive) and shorten review cycles. Forecast by segment and channel where possible, and monitor pickup patterns weekly or even daily during key periods. Flexibility in your forecast will give you more confidence to adjust strategy as things shift.

What role should FITs, wholesalers, and alternative channels play in my strategy now?

In today’s market, alternative channels can be valuable for filling short-term gaps – but should be used surgically. Monitor channel production closely and ensure visibility doesn't come at the cost of significant rate erosion. Use wholesalers to support low-lead windows or specific weekdays with traditionally low pickup – not as your primary base.

What makes a great revenue manager in today’s environment?

Adaptability and strategic communication. You need to interpret real-time data, respond faster than your compset, and align stakeholders around informed decisions. The best revenue leaders today are not just pricing experts – they’re commercial advisors who influence sales, marketing, and distribution from a position of data-driven clarity.