• Leisure Travelers Becoming More Price Sensitive   

Excerpt from CoStar

Hoteliers and travel experts speaking at the 2023 Hotel Data Conference said leisure travelers want to feel like they're getting a good value in their stay and that they're getting what they pay for.

Leisure travel led the start of the hotel industry's recovery from the pandemic, and the demand segment is still going strong years later.

During the "Leisure's Longevity" session at the 2023 Hotel Data Conference, hoteliers and travel experts spoke about the dynamic leisure demand segment, what these guests are looking for and where they want to go.

Seeking Value, Personalization

There’s a reason cruise lines and all-inclusive resorts have performed so well recently, said Steve Contos, executive vice president at Davidson Hotels & Resorts. People see these two options as great deals compared to a luxury hotel. Someone could spend $1,500 a night or $6,000 a week at a luxury hotel in Orlando or spend the same and take the Ritz-Carlton yacht to an all-inclusive in the Greek islands. 

“The consumer is looking for different ways [to travel], and it's really evidenced by the way all-inclusive and the cruises almost doubled their demand,” he said.

Cruise lines and all-inclusive resorts have an amazing value proposition, said Vinny Cuneo, vice president of revenue management at AutoCamp. It’s a retooling of how hotels package their offers to guests as opposed to offering discounts.

It’s about focusing on the things that are easy to add and what experiences a hotel can create to bolster the stay, he said.

Hoteliers need to take a look at how Airbnb has risen over the years and also why it’s talking about a slowdown, said Alex Cisneros, senior vice president of revenue generation and analytics at Red Roof Inn. They need to look at what hotels offer and what Airbnb doesn’t, such as daily cleaning services and other services, to differentiate hotels from vacation rentals.

“We are in a transition point on how we bring back some of the customers that perhaps went to vacation rentals because we have something to offer,” he said. “We have consistency. We have all different amenities that different brands offer.”

Airbnb is running into trouble because it’s a product of its own success, Contos said. When it started, Airbnb offered people a way to stay in a bigger space that was less expensive than a hotel.

“But now, it’s just as expensive to go to an Airbnb, especially when you factor in huge cleaning charges,” he said. “People are saying, ‘Well, if I’m going to spend that much money, I might as well go to a luxury hotel.’”

Red Roof’s teams are paying attention to how guests’ wants are changing, Cisneros said. For example, more guests started traveling with pets during the pandemic. The number of couples and individuals traveling with animals has grown about 15% since 2019, and it’s still growing.

“What’s happening is that it’s giving us opportunities to really refocus on who is the next wave of customers who we need to pay attention to,” he said.

Hotel brands have much more capacity for personalization than they ever had before, said Gabe Saglie, senior editor at Travelzoo. They can let pet lovers and solo travelers know what their hotels can offer each of them. Understanding a guest’s personal situation can win loyalty.

On a recent trip to Ireland with his family, Saglie said someone from the hotel they were staying at greeted them with galoshes ahead of their walk through a forest knowing there was a chance of rain. The hoteliers had gone through his Instagram account ahead of time to get an idea of the sizes of his children to approximate the size of the rain boots.

“That little bit of attention to detail that's personalized to me specifically can go a really long way, and I think we have a capacity now to do that in a much, much more effective way,” he said.

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