What do business travelers want? Not just clean rooms!

With business travel on the rise, hotels are probably thinking about how to make these lucrative customers as happy as possible. After all, a frequent business traveler can be on the road 40 weeks a year or more (been there, I assure you), and they don’t always have the same flexibility as leisure travelers. There’s a big opportunity here, especially with business travel set to increase next year.

“Consumers are more value-conscious than ever and have been conditioned to expect more for their money after a steady diet of recession-era deals. The tipping point for hotels to differentiate their brand offering and strengthen loyalty among the post-recessionary business traveler will be providing additional complementary services and amenities tailored to their guests’ specific needs,” said Adam Weissenberg, vice chairman and tourism, hospitality and leisure sector leader, Deloitte LLP. “Beyond traditional incentives, hotels are realizing the importance of developing their online presence, particularly with mobile platforms, to capitalize on a crucial touch point for brand communication.”

For both sectors, however, now would be a pretty smart time to listen to a group of customers that is about to start spending more money. Global professional services firm Deloitte recently surveyed 1,001 business travelers and has revealed the information that the travel industry can use to connect with its best target market more effectively.

Here’s what business travelers want:1. Work-friendly room: 68 percent of business travelers often work in their rooms, Deloitte said in a statement following the survey. And for a long time, I was one of them. If a room is not designed for me to get stuff done – from a desk to wifi access – the room doesn’t work. The amenities, artwork and staff responsiveness don’t matter if a business traveler can’t work comfortably.

2. Better than clean and comfy: are you satisfied with a clean room and a comfortable bed? Well, you’re probably alone. Deloitte found that 65 percent of business travelers “expect a lot more from a hotel” than that.

3. Business on internet time: it’s hardly responding that 79 percent of the respondents felt that high-speed web access was an important amenity. Seventy-seven percent cited free parking, as well.

4. Rewards for loyalty: 30 percent of business travelers, according to the Deloitte survey, “felt their favorite hotel brand was so important to them that they would stay at that hotel brand even if it were not in the most convenient location.” Interestingly, this level of loyalty was highest among respondents earning at least $150,000 a year.

There’s more than brand familiarity going on here, I suspect (again, my suspicion, not Deloitte’s). Rewards for loyalty sure help, and I remember it influencing a lot of business travel behavior when I was living the road warrior life.

5. Device love: almost half of survey respondents said they have a web-enabled smartphone. Meanwhile, this is true of 84 percent of the 18-to-29 business traveler crowd and 63 percent of business travelers earning more than $150,000 a year. Twenty-six percent of respondents have downloaded a hotel app to a device, with 54 percent of them using it “primarily to book a room.”

Hotels to ditch front desks in the next three years

Is the hotel front desk a thing of the past?

I was pretty blown away by this concept, which I ran into on MSNBC yesterday. It seems that the Los Angeles Andaz hotel and the Andaz in New York City have both gotten rid of the front desk. Instead, the hotel is greeting guests with a “host” bearin wine, a great chair and the chance to choose a room by laptop. The move, intended to be high-touch and personal, has played differently in both locations – welcomed in LA and not so much in Manhattan.

Yet, it could signal the next big trend in the hotel industry. The personal welcomes do focus more on the guest, and the thought of waiting in a comfy lobby chair instead of standing in line laden with baggage is pretty attractive. So far, Courtyard by Marriott has moved away from the front desk concept in 201 of its 800 lobbies in the United States, favoring “welcome pedestals” instead. By 2013, it hopes to complete the transition.

Changes are coming at other hotels, too, according to MSNBC:

Several thousand customers who already carried Starwood Preferred Guest cards were texted their room numbers before arriving at the Aloft Lexington in Massachusetts, allowing them to bypass the front desk and head to their floor. Once there, they simply tapped their preferred guest card on the door lock for room access. That pilot program is being expanded to Alofts in Harlem, Brooklyn, Jacksonville, Fla. and Brussels, Belgium.

James Sinclair, principal of OnSite Consulting, which focuses on the hospitality and restaurant industries, expects the front-desk concept to last another 36 months. In addition to appealing to many travelers, the move is expected to cut operating costs and give hotels a bit more breathing room follow a trying economic period.

[photo by prayitno via Flickr]

Airlines and hotels: the travails of accommodating a recovery

Market conditions are turning for the travel and hospitality industry. More people are leaving home behind for a while, and they are again willing to open their wallets to do so. Especially in the highly coveted business travel sector, seats are filling and rooms are being occupied. So, it would stand to reason that airlines and hotels would move to address the increase in demand. Unfortunately, accommodating growth can be risky in these industries. Every step must be made carefully and deliberately, with a plan for taking existing demand to a higher level.

Think about your local grocery store. If cans of corn start to sell aggressively, the store can examine the trend and order more for the following week. It may have to allocate a bit of extra shelf space, perhaps at the expense of canned peas The risk isn’t that high, though, because demand can be handled in smaller increments.

The core product isn’t as flexible in the travel and hospitality business. As people look to book more rooms or flights, a hotel or airline can’t simply add a bed or a seat. Airlines can add routes (or restore those that have been cut), but that creates a new problem.
Assume that demand for a particular route has grown from the norm to the point that another one third of a plane’s seats would be filled. New revenue is coming in the door, but cash is also going out to cover the cost of operating the flights. To make this growth profitable, the airline may have to fill more of the seats on that new flight. To accommodate demand, essentially, the airline will have to create even more.

This is the reasoning behind United Continental CEO Jeff Smisek’s remark on an earnings call recently, as reported by the Associated Press, “We will not grow for growth’s sake, but only if we can maximize our profitability by doing so.”

For the hospitality industry, the challenge can be even greater. A major chain may see an opportunity to take on more guests by adding another property, but this doesn’t happen overnight. It takes time, effort and capital to get a hotel up and operational, especially in a major city. During the time it takes to plan and execute an expansion, market conditions can change substantially, as the hospitality industry learned with the credit crisis of 2008. Real estate and financial market conditions can have a magnified impact on the hotel business, and the underlying drivers move far more quickly than those supporting increases in rooms capacity.

Projects already in the works in 2008 left the industry with more supply than it needed in 2009 and 2010, and demand for rooms, according to travel industry research firm PhoCusWright, isn’t expected to return to 2007 levels until next year. This means that net growth won’t begin until 2008.

Think about it: plans that may have begun to be executed in 2007 won’t deliver results for at least four years, maybe even five.

Managing supply and demand in the travel industry is, to say the least, a tricky business. Traveler purse strings are starting to ease, making life much rosier for airline and hotel company income statements. Taking advantage of this opportunity, however, is easier in theory than in practice. This year and next, we’ll see how the hotels and air carriers manage the perils of potential.

[photo by disparkys via Flickr]

Five signs that the hotel meeting business is recovering

Business meetings are back in style. Group customer is on the rise for the hotel business, signaling that the corporate crowd Is getting back out on the road. Joining the party are other groups, such as associations, sports teams, religious groups, social organizations and the military, according to USA Today.

The U.S. Travel Association is predicting a 7 percent increase in meeting and convention spending this year, with a forecast of $90.7 billion. Last year, this measure fell 15 percent, as the effects of the financial crisis and subsequent recession led to cancelations.

To get the big bucks back in the door, hotels and convention bureaus have been rolling out favorable pricing and sweetheart deals, and it’s starting to work.

So, how do we know this sector’s coming back? Here are five hints:

1. The meeting planners say so: A June survey by Meeting Professionals International showed 61 percent of respondents saying “that they’re seeing more favorable business conditions, including attendance, budgets and number of meetings,” according to a USA Today report. Only 15 percent responded this way in August 2009.

2. Hotel groups say so: InterContinental Hotels Group has announced that its group and corporate revenue climbed 10 percent in the first half of 2010 relative to the same period in 2009. Denihan Hospitality Group’s eight New York City hotels are showing an increase in group revenue of 26 percent year-over-year.
3. Even Grand Rapids has good news: The JW Marriott in Grand Rapids, Michigan has sold more than 1,500 group room-nights so far this year, up 20 percent from last year.

4. So does Fort Lauderdale:
In this Florida town, group revenue is up 30 percent at the Harbor Beach Marriott. Corporate deals are still down from last year, but other groups are more than making up the difference.

5. Hotels understand what’s going on: Even though the market is coming back, hotels realize that they still need to price aggressively. Notes George Aquino, general manager of the Grand Rapids JW Marriott Everyone’s felt the turmoil of 2009. We don’t want that to happen again.”

[photo by msprague via Flickr]

Hotels making a move on social media, with targeted help

The hotel industry has plenty of faith in the social media world – and no reservations about using it to gain reservations. But, it’s struggling to take control of the medium. A survey by Wine and Hospitality Network indicates that most respondents (in the business) spend only two hours a week managing their Facebook fan pages – with 14.2 percent having no such page to manage. Forty-two percent don’t use Twitter, and 25 percent tweet for less than an hour a week (they should reach out to @Colonnade for tips).

But, it isn’t for lack of trying. The internet is littered with the corpses of abandoned social media marketing initiatives, inside the travel industry and out. Notes online marketing publication ClickZ:

“Before hoteliers even consider a social media initiative, they should be aware that social media is a very engaged, hands-on marketing format. The social networks are a graveyard of abandoned hotel profiles and fan pages by hoteliers who did not realize the complexity of social marketing,” said Margaret Mastrogiacomo, social media specialist with Hospitality eBusiness Strategies, a strategic services and design firm.

Several properties are getting in on the action, committing resources and genuinely seeking returns. New York’s Roger Smith Hotel has made a clear social media play, according to ClickZ, by adopting Revinate, a tool to facilitate active social media management specifically for the hospitality business. Kimpton has adopted this platform as well.

ClickZ continues:

The focus on hotels pays off for the Roger Smith’s Simpson, who used to spend hours using search and setting up news alerts on competitors. While Revinate doesn’t include some of the hot new social media startups he keeps an eye on, like Bizzy and Pegshot, he says it covers the major sites, especially TripAdvisor, the most important. The ability to compare his hotel’s buzz with competitors is also unique. “It’s one thing to do it manually for your own establishment, but for me to do that for surrounding hotels or for what other people we have an interest in are doing, that becomes more laborious.”

So, what does this mean for the average traveler? Your opportunities to engage with the hotels you’ll call home, if only temporarily, are set to increase. Think beyond deals (though they are important) to every other reason you’d contact and open dialogue with a hotel. The possibilities are immense, and hotels, a bit slow to move in social media, appear to be on the brink.