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What is the meaning /definition of Demand in the hospitality industry?

By Demand, we mean the level of consumer interest and need: demand for beds, demand for family rooms, demand for conferencing, event space, rentable scuba diving gear...

If a manager asks a chef: 'Jacques, did you serve a lot of meals in the restaurant tonight?' she could also frame the same question like this: ''Jacques, was there high demand for meals in the restaurant tonight?'

Demand for products and services can change a little, or a lot! For example, hotels in Austria's Tyrol will experience a noticeable increase in demand for rooms during the peak skiing season, but during the low season demand could be worryingly small.

Generally, prices amplify as demand grows, and vice versa.

A demand calendar is something crucial for your revenue management strategy and it will also help you make informed pricing decisions based on solid data and statistics.

Identify all events that impact your demand. Positive or negative demand generators must be recognized. Once updated, a demand calendar should not sleep. It should be updated every time you identify an event impacting your demand… that means one update a week at least! Other important elements to consider are school and back holidays in your market of reference.

In Hospitality, other types of demand could include:

  • Constrained or unconstrained demand – the total demand for a particular date irrespective of a hotel's capacity.
  • Elastic or inelastic demand – An inelastic demand means that the demand is not sensitive to fluctuating pricing levels.

See also:


  • Demand

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