That era is clearly shifting.
Economic headwinds like persistent inflation, elevated interest rates, geopolitical uncertainty and rising labor and insurance costs are putting real pressure on owners’ bottom lines. At the same time, supply is starting to increase again, competition is intensifying and consumer behavior remains more dynamic and less predictable than pre-pandemic norms.
Revenue management and commercial teams were the heroes of the COVID era. They held rates when it felt uncomfortable. They found revenue wherever it was hiding. They innovated in distribution, leaned into alternative demand segments and helped stabilize portfolios in unprecedented conditions.
Then came the growth years.
When ADR is rising broadly and demand is abundant, it’s easy and very human, to relax just a bit. Discipline can slip. Processes become looser. Collaboration can become more reactive than proactive. And because revenue is flowing, many of those gaps are masked.
In other words, revenue hides all sins.
As we look to 2026, most forecasts suggest another challenging year, especially outside of luxury brand scales. There are bright spots. Major markets like San Francisco and New York City are growing and the World Cup will be a nationwide demand driver, but in many markets, capturing fair share will be harder, and outperforming the comp set will require sharper execution. Commercial teams will need to re-engage their discipline, re-tighten collaboration and refocus on the fundamentals.
This isn’t about panic. It’s about precision.
Here are three practical principles to help commercial leaders and their teams successfully navigate a more competitive, margin-pressured environment in 2026 and beyond.
- Don’t Panic: Lead with Signal, Not Noise
When pace slows, competition heats up and owners are calling every other day, the instinct to take dramatic action is strong – slashing rates, accepting marginal business, opening discount channels just in case. These reactions are understandable, but often counterproductive. The most successful commercial teams resist the urge to react emotionally.
Instead, they double down on data, discipline and structured decision-making. Use leading indicators, not lagging performance. Trailing metrics like occupancy and month-end RevPAR tell you what already happened, not what is about to happen. Particularly in down markets or rapidly shifting environments, the real strategic advantage comes from monitoring leading indicators:
- Search and shopping data
- Website and OTA conversion rates
- Forward pace by segment and channel
- Pickup versus historical and competitive benchmarks
- Airlift trends and major event calendars
- Corporate RFP activity and group lead volume
These signals help teams understand whether softness is systemic, segment-specific or temporary and allow for more targeted actions rather than broad-based discounting.
Let automation automate. Many organizations have invested heavily in revenue management technology, pricing tools, channel management and forecasting. In a down market, the temptation is to override systems more frequently or to “manage by gut.”
That’s a mistake.
Modern revenue systems are designed to process massive amounts of data, far more than a human can reasonably synthesize, to detect patterns buried within that data, and to optimize routine pricing and inventory decisions. Even if performance is down, letting systems manage the day-to-day frees commercial leaders to focus on what humans do best: exception management, strategic thinking and cross-functional collaboration.
Technology should handle the routine. People should handle the nuance. Understand the dynamics — not just the numbers. Context matters more in volatile markets. A soft week might be explained by a canceled conference, a shift in airline capacity, a weather event or a change in a major corporate account’s travel policy. A strong spike might be tied to a specific event, team or market-specific driver.
For example, with the World Cup approaching, demand patterns will vary significantly based on which teams are playing in which cities, how fan travel is distributed and how long stays extend beyond match dates. Granular understanding of these dynamics can materially improve pricing, length-ofstay strategies and marketing activation. You don’t have to become a soccer fan, but you do have to become a soccer-fan behavior expert. And your job is to feed that insight into the systems so they can better optimize your hotel.
The bottom line: Don’t panic. Get smarter. Replace emotional reactions with sharper signal detection and more precise action. - Collaborate across the entire booking horizon, with 2. all commercial colleagues
Winning in a competitive market requires collaboration across revenue, sales, marketing, distribution and operations earlier, more intentionally and with
shared accountability.
Price is a blunt instrument. If your primary response to softness is last-minute discounting, chances are something went wrong earlier in the booking window.
Pull all available levers, not just price. Commercial strategy is multi-dimensional. Pricing is only one lever among many:
- Sales can build base business through targeted corporate, group and extended-stay efforts.
- Marketing can stimulate demand earlier in the booking cycle and improve conversion through targeted messaging, offers and retargeting.
- Distribution teams can optimize channel mix, content health and visibility.
- Revenue can shape demand through LOS controls, fences and yield strategies, not just rate cuts.
Bringing these functions together earlier in the demand curve reduces the need for reactive discounting later.
Listen to operations and the voice of the traveler. Operations teams and guest feedback are often underutilized strategic inputs. What are guests praising? What are they frustrated by? Are certain traveler segments consistently happier and more profitable than others?
Understanding who is in the building, whether they’re the right fit and how guest experience aligns with target segments allows commercial teams to refine their mix strategy. Sometimes the opportunity isn’t to fill more rooms, but rather to attract a better, more profitable guest.
Shift meetings from reporting to strategy. Many commercial meetings are still dominated by backward-looking performance readouts. While performance review is important, it should always be framed as a strategy debrief:
- What worked?
- What didn’t?
- What should we do differently next time?
- What assumptions were wrong?
- Where did processes break down?
Forward-looking strategy, not just retrospective reporting, should be the core purpose of cross-functional meetings. Align with ownership goals and profitability realities. Owners are under increasing pressure from rising costs and tighter financing conditions. GOP and cash flow matter more than ever. Commercial leaders must understand each asset’s specific ownership objectives and risk tolerance.
This means actively discussing not just top-line growth, but also:
- Net RevPAR and contribution margins
- Channel costs and acquisition economics
- Business mix profitability
- Labor and operational constraints
Aligning commercial strategy with ownership priorities builds trust and leads to smarter, more sustainable decisions. Invest in dashboards that drive action, not just awareness.
Comprehensive, easy-to-understand dashboards are more than reporting tools– they’re alignment tools. The best dashboards:
- Combine leading and lagging indicators
- Deliver prioritized insights to clearly highlight opportunities and risks
- Make tradeoffs visible (rate vs. mix vs. cost of sale)
- Are shared across functions to support a single strategy
When teams are looking at the same data, framed the same way, collaboration becomes easier – and more productive. - Focus on Fundamentals: Everything Old Is New Again
In a soft market, fundamentals matter even more. Many of the basics that felt less urgent in high-growth environments become decisive differentiators
when demand tightens.
Content, listing health and AI readiness. With increasing reliance on AI-driven search, voice assistants and personalized travel discovery, accurate, complete and rich content is more important than ever. Property descriptions, amenities, images, policies and attributes all feed algorithms that determine visibility and relevance.
This has always mattered, but now it directly impacts how AI surfaces your property to travelers. This is no different than what we had to focus on in the early days of SEO and SEM. Even if you’re still completely baffled by the whole world of AI, you know how to do this. A systematic review of content comprehensiveness is one of the highest-ROI activities commercial teams can undertake.
Retrain, revisit and reconfigure your technology. Many organizations underuse the full capabilities of their commercial tech stack. Markets change. Consumer behavior evolves. Assumptions embedded in systems may no longer reflect reality.
- Revisit demand segmentation and forecasting logic
- Update benchmarks and comp sets
- Recalibrate forecasting and optimization algorithms for optimal pricing recommendations
- Ensure integrations and data feeds are clean and complete
Technology should evolve with the market, not remain frozen in a prior demand environment. Even with the latest AI, some user oversight is required
to ensure your ecosystem is responsive.
Watch your business mix and cost of sale relentlessly.
In margin-pressured environments, not all revenue is created equal. Understanding true cost of sale across all channels, including OTAs, GDS, direct, B2B, wholesale and corporate, is critical. But don’t look at channel cost without understanding the value of the demand it brings– for example, a channel that delivers high-ADR guests at a high cost could end up being more profitable than a low-cost channel that only delivers deeply discounted rates. Commercial teams should regularly analyze:
- Net contribution by segment and channel
- Commission and acquisition costs
- Length of stay and ancillary spend
- Operational impacts of different traveler types
Owners will increasingly expect commercial leaders to optimize not just revenue, but profitability. The teams that can clearly articulate and more importantly act on these tradeoffs will stand out.
Be relentless about performance management. Down markets expose both strengths and weaknesses in teams. Clear goals, transparent expectations and consistent coaching are essential. High performers should be recognized and rewarded. Lower performers should receive direct feedback and structured development, quickly.
There is little room for passengers in markets like this. Commercial success requires engaged, accountable teams who are rising to the occasion. Addressing performance gaps early protects both culture and results.
Back to Basics: With More Intention. None of this is revolutionary.
In many ways, it’s a return to core commercial disciplines: data-driven decision-making, cross-functional collaboration and operational rigor. What has changed is the margin for error. When demand is abundant, imperfections are hidden. When demand softens, those imperfections become visible and costly. The teams that succeed in 2026 won’t be the ones who panic or chase volume at any cost.
They will be the ones who:
- Stay calm and lead with signal, not noise
- Collaborate across functions to be proactive, not reactive
- Double down on fundamentals that drive sustainable performance
Revenue may hide all sins in boom times. But in tougher markets, discipline, collaboration and fundamentals are what separate winners from the rest.
Get back to basics. Tighten the process. Invest in your people. Let technology do what it does best. And keep your eyes firmly on both top-line opportunity and bottom-line reality.
That’s not just how you survive a down market. It’s how you build a stronger commercial organization for the next upcycle.
