Hotels and airlines use highly sophisticated software for revenue management. This software is capable of forecasting 365 or more days into the future, with relatively high accuracy, how many rooms of a particular room type (standard, suite, etc.) will be booked on each date and how far in advance the booking is made. These forecasts are based on highly statistical models that take into account years of booking history for each property. A hotel is more likely to publish a deal on PRICELINE or HOTWIRE when the actual bookings expected for some number of days prior to the stay is lower than what is predicted/expected. The number of bookings allowed under such a deal is likely to be only enough to make up for the shortfall between actual and expected bookings. Once the bookings match the forecast, the deals will be retracted unless actual bookings continue to dip. Because you don't know the date ranges that apply to these various periods, it makes it very difficult to guess or intuit when a property will put its rooms "on sale". Further conflicting the matter is that the software can also calculate a "cost to serve" a particular reservation at a particular time. Logically, consumers assume that the costs for a room are rather fixed and that any offer "above cost" should be money in the bank for the hotel. So why shouldn't they offer the rooms? Based on the forecasting information previously described, the software can show revenue managers how making a guaranteed sale now may actually prevent a more profitable sale of the same room at a later date. So it's not just a question of does the hotel make a profit, but instead how much profit given what the property expects to happen between now and the date you wish to stay there. The simple fact is, due to the advanced software in use, as you get closer to the date of your stay there's no guarantee that rates will decrease. In fact, to get a deal, you're generally betting on the general public to not do what the statistical models predict. Otherwise, all else equal, you should expect rates to rise as you get closer to the date of your stay because the properties want to capture a premium price from the people who need to book that one last room on exactly those date(s). And the same can be said for the airlines. They have a lot more data than we do, and it's hard to beat their data.
