DECADECA Travel and Tourism Practice Exam

What is a promotional rate offered by hotels used for?

1. To standardize hotel pricing

2. To boost room occupancy during low demand periods

3. To create loyalty programs for frequent travelers

4. To increase prices during high demand periods

The correct answer is: To boost room occupancy during low demand periods

A promotional rate offered by hotels is primarily designed to boost room occupancy during low-demand periods. These rates are strategically implemented as a way to attract guests when occupancy levels may be lower than desired, such as during off-peak seasons or weekdays. By offering these discounts or special rates, hotels can encourage more bookings, improve cash flow, and maximize room usage. This strategy effectively helps hotels manage their revenue through dynamic pricing. When demand is weak, promotional rates serve as an incentive for guests who might otherwise look at other accommodations or decide not to travel. It ultimately balances occupancy rates and revenue, making it a vital tool for hotel management. While other options discuss concepts related to pricing and guest loyalty, they do not accurately capture the primary purpose of promotional rates. Standardizing hotel pricing or increasing prices during high demand would not align with the intent behind offering promotional rates. Similarly, while loyalty programs are important in creating repeat business, they function differently from promotional rates and are not specifically targeted at addressing low demand periods.