Hospitality Trends - Class 5

The recent economic downturn has caused consumers to evaluate their priorities when it comes to vacationing thus impacting the hospitality market. Many consumers opted for “stay-cations” whereby they were tourists in their own cities. This depleted the hotel industry as many rooms stayed vacant for extended periods of time. The question now becomes what are penny-pinching consumers looking for when they travel and will wary hoteliers respond?

One trend for hoteliers to rid of vacancy is through member only websites or “flash sales” such as Rue La La, SniqueAway, and Groupon. This allows hotels to discount unused rooms at non-peak travel times without diluting the image of their brand. These types of websites have become popular with travelers looking for a discount – usually in the 35-60% range.

Furthermore, cash strapped adventure seekers can opt for the tiny hotel room concept. This hotel type is for those who spend their vacations on foot and sight-seeing rather than in their room. Travelers can expect a 30-40% decrease in price over standard hotel rooms. Such a concept is typically heavily traveled cities like New York and Tokyo.



In attempt to lure wary travelers, hotels are also ramping up their level of service and amenities, usually at no additional expense. Consumers demand items such as flat screen TV’s and Wi-Fi – items which were once considered a luxury. Hotels are trending towards a more personal touch, better check-in service and will cater to individual needs as a way to set themselves apart from competition.

Consumers are looking for a more unique experience and are more cautious with their hard earned dollars. Boutique hotels are becoming more popular as consumers move away from the one-size-fits-all mega hotel. Patrons will typically receive a more attentive level of service and amenities. Hotels are also cashing in on catering to specific likes of travelers. Theme hotels for Star Trek, Star Wars and Jurassic Park have a strong enough niche to remain viable. Some boutique hotels are even offering an “unplugged” vacations which provides no TV, no Wi-Fi, and no in-room telephone – a sort of digital detox.


Hotel owners in major US destinations such as New York, Boston, and Miami have been surprised by the uptick in demand and how quickly it has returned. Some industry experts predict average daily room rates to increase by 5% in 2011 as leverage slowly shifts back from the consumer to operator. Another factor in the increased rates is the slowdown in new hotel construction which limits competition.

As consumers begin to travel again there will be plenty of options in terms of destinations, themed hotels, boutique hotels, and hotel types for all kinds of travelers.