Hotel Revenue Glossary · Demand

Demand Curve

A graphical representation of the relationship between room price and the quantity of rooms demanded at each price point. The demand curve slopes downward — as price increases, fewer rooms are demanded, and as price decreases, demand rises.

Why it matters: Understanding your demand curve for each date helps determine the optimal price point that maximizes total revenue. Pricing too high leaves rooms empty; pricing too low fills rooms but sacrifices rate. The demand curve identifies the sweet spot.

All glossary terms Price Sensitivity Demand Elasticity Dynamic Pricing