Weathering the business travel downturn: strategies for independent lodging properties

The landscape of business travel is shifting beneath our feet, and not in the way many of us had hoped. After a promising 2024 where global business travel finally surpassed pre-pandemic levels, we're now seeing a significant pullback that's affecting independent lodging properties across the country. As someone who's spent significant time on the road, I find this particular downturn both challenging and strangely familiar.

The current business travel climate

If you've noticed fewer business travelers checking in lately, you're not alone. A recent Wall Street Journal article (subscription required) highlighted how companies are tightening their travel budgets in response to economic uncertainty. "We're seeing pushback on items as small as taxi journeys," said one executive quoted in the piece. Companies like Meta have implemented strict policies limiting employees to just four trips annually without special permission.

This trend is backed by hard numbers. According to the Global Business Travel Association, nearly a third (29%) of global travel buyers expect their company's travel volume to decline in 2025, averaging a 21% decrease in travel volume. March trips sold by U.S. corporate agencies have dropped year-over-year for the third consecutive month, and corporate bookings at U.S. hotels through late April fell 4% compared to last year.

For independent lodging properties that have traditionally relied on business travelers to fill rooms during weekdays, this presents a significant challenge, which may not be evident with Memorial Day around the corner, but that if conditions persist can be a problem down the road. Here's the thing - I actually think independent properties have some unique advantages in this climate. Let's dive in.

Why independent properties might actually have an edge

Independent hotels have been performing surprisingly well despite economic headwinds by leveraging their greatest asset: flexibility. Unlike large chains with rigid protocols, independent properties can quickly pivot their strategies to meet changing market conditions.

Independent hoteliers at the 2024 Hotel Data Conference noted that their properties have outperformed branded hotels in many markets. "Generally our independent hotels are doing really well," said Romy Bhojwani, senior vice president at HHM Hotels. "Our independent hotels are pushing rates to those they haven't seen."

The reason? Independent properties can create authentic, localized experiences that business travelers and leisure guests alike find compelling. As one executive mentioned, "As an independent you have all the creative freedom you could possibly want to create these experiences."

Practical strategies for weathering the storm

So what can you, as an independent property owner or manager, do right now to offset the decline in business travel? Here are some approaches worth considering:

1. Rethink your pricing strategy

During downturns, discounting seems like an obvious solution, but it's rarely the best one. Cornell University research shows that hotels that simply slash rates typically underperform those that use more strategic approaches.

Instead, consider:

• Attribute-based selling: Allow guests to select and pay for only the specific amenities they want. This puts travelers in control and potentially increases your revenue per booking.
• Value-added packages: Rather than lowering your base rate, create packages that include extras like breakfast, parking, or local experiences. This preserves your rate integrity while still providing perceived value.
• Dynamic pricing: If you haven't already, now's the time to implement dynamic pricing that responds to demand patterns. Properties like Devonfield Inn have increased revenue by 10-15% just by being more responsive to market conditions.

2. Target new market segments

The decline in traditional business travel doesn't mean all segments are contracting. According to industry experts, there's been growth in:

• Regional business travel: "A lot of companies are pivoting and doing business with regional and local providers because of supply chain issues. Those are [hotel room] nights that we're picking up," noted Jonathan Bogatay, CEO of NCG Hospitality.
• Project-based stays: While regular business travel might be down, project-based teams that need to stay for extended periods still need accommodations.
• "Bleisure" travelers: Business travelers who extend their trips for leisure purposes continue to be a viable segment.
• Focus on the business travel fundamentals: from strong wifi to available meeting space, or a simple desk in a room ultimately can make or brake a traveler's decision to choose an independent property on a business trip.

3. Enhance the guest experience

In difficult times, the guest experience becomes even more crucial. Independent properties that create memorable, authentic experiences can maintain higher occupancy rates despite market challenges.

Event planners are specifically seeking out independent hotels because they offer unique experiences that can't be found at branded properties. In fact, 44% of event planners desire programming they can't get from big brands.

This might mean:

• Creating local partnerships with restaurants, attractions, or activity providers
• Developing unique on-property experiences
• Personalizing the guest journey from booking to departure

4. Leverage technology (without breaking the bank)

Technology doesn't have to be expensive to be effective. The right technology stack can help you compete more effectively with larger brands, especially during downturns.

For example, When Chris and Sarah Kennedy at Inn on Main were looking into property management systems, they found themselves drawn to ThinkReservations for its ease of use, flexibility, and the way it could grow with their business. Chris, with his IT background, especially appreciated how intuitive and capable the system felt-and it didn’t hurt that it made sense for their budget, too.

Technology can also help you:

• Streamline operations to reduce costs during lean periods
• Automate guest communications to maintain service levels with fewer staff
• Gain insights into booking patterns to segment marketing efforts (specially targeted email marketing efforts) more effectively

Real-world success stories

I'm always inspired by seeing how real properties navigate these challenges. Take York Harbor Inn in Maine, which leveraged technology to increase their upsell revenue by over 33%, even during uncertain economic times, and with significant improvements from their business travel segment (which I experienced in our visit last fall). Or Saratoga Arms, which achieved a 22X ROI on their ad spend by focusing on direct bookings when OTA business was declining.

These properties didn't just survive downturns-they found ways to thrive by being nimble and strategic.

Final Thoughts

The business travel slowdown is real, and it's probably going to be with us for a while. But it does not mean it is time to panic. Instead, it means it is time to adapt. Independent properties have always thrived by being more responsive and personal than their branded counterparts. This current challenge is actually an opportunity to leverage those inherent advantages.

By rethinking your pricing strategy, targeting new market segments, enhancing the guest experience, and embracing the right technology, your business can navigate this storm and potentially emerge stronger on the other side.