What is the meaning / definition of Length of Stay Discounts in the hospitality industry?

Also known as Tiered Pricing, it is a price discount system for guests who stay a preselected amount of days or nights. Length of Stay Discounts are used to encourage guests to book for longer periods of time than originally anticipated.

This discount is used by independent hotels and chains around the world and can be commonly seen when a low-peak season is right after a high-peak season, in hotels that specialise in long term accommodation or hotels that want to entice customers to stay for longer period of time. This strategy is also used to stay competitive in the hotel industry among price-savvy vacationers. A length of stay discount is commonly displayed on a hotels website and used by customers who book directly. However, there are special occasions where hotels partner with online booking engine for special length of stay discounts to customers who book with the online booking engine.

The discount is usually attached to the rack rate before taxes and extra fees, and will be replicated during each night. For example, if a hotel offers a 4 day at a 15% discount, the discount will be 15% off per each night not in total.

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