We’ve spent plenty of electrons over the past two years griping about the almost comstantly arising airline fees. Paying to check bags, get blankets and so on has become part of the misery that comes with getting on a plane these days. Meanwhile, the hospitality industry managed to stay above the fray. The same pressures affecting the airlines came to bear on hotels, as well. And, the constraints on credit made it even worse, with buildings in progress struggling under the weight of insufficient or expensive capital.
Now, there are grumblings that hotels could follow the airlines. Look out for some extra fees.
That hotels would adopt an a la carte model isn’t surprising. Rather, it’s almost shocking that it’s taken this long. A recovery in the hospitality sector isn’t expected to begin until 2011, and like airlines, hotels sell a perishable commodity. For an airline, an empty seat on a particular flight can never be sold later. If 34C from New York to Las Vegas at 7 PM on July 2, 2010 is empty, it represents money that will never come in the door. Likewise, if hotel room 345 in Las Vegas is empty that night, it can never be recovered.
The money needs to come from somewhere else.Of course, hotels are no strangers to additional fees. Many charge for internet access and use of the gym, among other amenities. And, like the airlines, they cut staff and perks throughout the financial crisis and its aftermath, a situation that has not gone unnoticed. What’s on the horizon, however, could be extreme.
Could you imagine paying for use of the television? Housekeeping? Towels?
A hotel in Europe, easyHotel, is playing with this model. For low room rates, it will be hard to beat: it can get as low as $35 a night. But, the towel fees essentially mean that you’ll need to pay to shower. It will be interesting to see how this unfolds, but I’m not sure the model will be broadly applicable.
There’s more competition among hotels than there is among airlines – mainly because we have more choices available. Depending on your hometown and destination, the flights you can take are limited, even if you’re headed to a major city. Once you hit the ground, however, there are usually a number of hotels from which to choose. Often, you can pick from properties in a similar category (e.g., extended stay). With hotels eager to get guests in the door, it’s unlikely that fee-laden stays will get much traction.
Generally, I’m supportive of anything that can help a business turn a profit (that’s why they exist, after all), but I get the feeling that a la carte hotels will be niche at best. What do you think about this?
