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Dynamic Pricing in Hotels, Machine Learning Power by Egencia

Save money with the new dynamic pricing in hotels

3 min
Posted: 30 September 2021
Save money with the new dynamic pricing in hotels

Egencia® Launches New Dynamic Hotel Rate Cap Feature Powered by Machine Learning

Artificial intelligence (AI) automatically generates price-per-night limits – eliminates time-consuming manual research and uncovers hidden savings

London, United Kingdom., September 30, 2021 - At the Business Travel Show today, Egencia®, announced the launch of a new hotel policy configuration feature that uses an AI-powered algorithm to automatically and dynamically adjust hotel price caps according to the local market median. It is also the first feature of its kind that is personalised to a company's travel policy groups and its corporate booking behavior.

Most companies set hotel rate caps (or 'per diems') manually by city or destination, a time-consuming process that involves analysing previous booking behavior and investigating local market rates. As a result, corporates typically prioritise setting price caps for the biggest or most frequently visited destinations but potentially lose out on savings in smaller towns or cities.

Egencia's new dynamic hotel rate cap feature uses machine learning to automate this process by aggregating real-time hotel prices in a specific location to identify a market median and using it to configure the appropriate price-per-night cap for any traveller booking a room in that town or city. It frees up valuable bandwidth for travel managers, and constantly adjusts for market fluctuations while driving down spend.

John Sturino, Vice President of Product, Egencia comments:

“We are passionate about how artificial intelligence and machine learning can transform business travel and are making significant investments in this area. The dynamic hotel rate cap feature leverages these technologies to help companies and travellers manage uncertainty and respond to fluctuations in a volatile market.”

The new feature also enables travel managers to personalise hotel rate caps for the different travel policy groups that exist within an organisation. For example, if the algorithm recommends a price per night of $150 in a specific town, this can be automatically increased for specific employee types such as frequent travellers ('road warriors') or senior executives. Travel managers can customise the strictness of rate caps by specifying that only hotels with a minimum star rating are used in the median calculation, as well as mix and match between dynamic and static hotel rate caps for specific travel groups, cities, or countries.

The dynamic rate cap feature also integrates with Egencia Analytics Studio allowing travel managers to benefit from detailed reporting and visual dashboards that clearly demonstrate the median rate, booked rate and the savings realised. Based on the first pilot Egencia has conducted, the feature can deliver average savings of $20 per hotel booking. The new data fields in Analytics Studio will give travel managers insight going back to January 2021 on how their travellers are booking relative to the median market rates regardless of whether they activate Dynamic Rate Caps.

For more information on Egencia dynamic rate cap tool, please visit

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