trends that will shape the future of hospitality sector are

8/7/2019 Trends that will shape the future of hospitality sector are

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Trends that will shape the future of hospitality sector are:

1. Low Cost Carriers

2. Budget Hotels

3. Service Apartments

4. Technology

5. Loyalty Travel

1. Low cost carriers: Travelers in general are more price sensitive to airfare than they are to hotel room rates. Often a

low airfare will stimulate demand for travel even if hotel prices are increasing. LCCs are a good option for business

travelers, as they have advantages like low costs, more options and connectivity.

2. Budget hotels: More than 50 per cent of occupancy of a majority of hotels comes from the business travel segment.

The average room rate (ARR) realized from business travelers is normally higher than from leisure travelers. Heightened

demand and the healthy occupancy rates have resulted in an increase in the number of budget hotels. Some of the new

players entering into this category of hotels include Hometel, Kamfotel, Courtyard by Marriott, Country Inns & Suites, Ibis

and Fairfield Inn.

3. Service apartments: The concept of service apartments, though a recent phenomenon in India, is an established

global concept. Villas in Spain, flats in the UK and apartment complexes in the US have all created a viable market for those

who want more than just a room in a hotel. Service apartments are the latest trend in accommodation, offering the comfortand convenience of a home without the hassles of having to maintain or look after it. Ideally suited for medium-to-long

staying guests, service apartments are a natural choice for corporate employees or expatriates relocating to a particular city,

non-resident Indians visiting the country for long spells and foreigners visiting the city for long durations.

4. Technology: Travel and technology have become inseparable. Technology is making its own advances with high-tech

video conferencing facilities, web cameras and virtual reality mode of conferencing. On-line bookings, e-ticketing, Wi-Fi

Internet connectivity, easy access to information, etc. are just a few areas where technology has completely changed the

the way we travel.

5. Loyalty travel:Today, airline-credit card company tie-ups have brought a whole range of benefits to the travelers.

These include insurance cover, upgrades, free tickets, access to executive lounges, and a host of other goodies.


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Omni Hotels & Resorts Achieves Record RevPAR with Micro-Focused Rate-SettingStrategies

February 22, 2011 - Faced with the expanding number of online travel providers and channels in the marketplace, hoteliers

must develop and implement increasingly sophisticated revenue management strategies to manage rates and availability.

Omni Hotels & Resorts has created and implemented unique approaches and processes that are highly responsive to this

rapidly changing online environment and, most importantly, it is seeing conclusive, positive results.

In early 2009, when Omni noticed a reduction in business travel, it offered more competitive rates to maintain occupancy

and market share. But when demand returned in 2010, the company gradually reduced its mix of discounted segments to

maximize overall ADR. Omni relied on the revolution revenue management system from The Rainmaker Group to

implement its strategy and achieved a record RevPAR index. As a company last year, Omni achieved the highest RevPAR

index it has achieved in 10 years, said Lesli Reynolds, VP of distribution systems and revenue strategy for Omni Hotels &

Resorts, which includes 50 luxury properties in North America.

Greater precision, confidence in rate-setting

When the numbers indicated demand was returning, we changed our mix of discounted business to increase ADR without

jeopardizing occupancy, said Reynolds. We worked with revolution to reduce non-qualified discounts by establishing

prepay, advanced booking and other requirements that aided our RevPAR index.

Reynolds noted that Rainmakers revolution solution supports both occupancy- and ADR-focused strategies. There is a

real advantage in having more accurate demand forecasts based on commitments, historic data and seasonality by

segment. We use revolution to rationally set segment rates in all markets and across the highest yielding channels. This

strategy leverages our most effective channels and prices rooms so guests who stay with us pay the most appropriate rate

for our hotels.

Omni found that other systems utilize a broader price-setting process to recommend the most competitive rates, but

Rainmakers solution is more micro-focused. revolution looks at every rate, said Reynolds. That is a significant advantage

for a company with properties in markets as varied as San Francisco, New York and Tucson. It gives us greater confidence

in our strategies and rate setting when we have all the data available.

Increased revenue from data-based rather than gut-based decisions

Omni installed a new brand-wide property management platform with a centralized database in 2008. The central

reservation system interfaces with revolution to provide data for our demand forecasts and rate setting calculations,

Reynolds said. revolution generates bid price recommendations for all segments of our hotels. The success we have had

with increased RevPAR is based on the analytics that let us make data-based decisions rather than gut-based.

Prior to its implementation of revolution, Omni utilized corporate and leisure rate segmentations. Now we have seven best-

available rates by day-of-week and demand restrictions by length of stay along with hurdles to help us maximize rates and

occupancy throughout the week, Reynolds said.


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Maximized RevPAR every day of the week

Reynolds cites the Omni Berkshire Place in the high-density NYC market. We used revolution to measure the growing

strength in the New York market based on many variables including history and seasonality. The system enabled us toprotect our peak weekdays and still maximize occupancy and rate throughout the week.

Omni has on-site property revenue managers who work with the revolution system on a daily basis, Reynolds notes. They

are familiar with their markets and review revolutions optimized segment price recommendations and fine-tune them, with

our input, to implement strategies that maximize both RevPAR and occupancy.


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In the midst of all the doom and gloom, I think we could all use some levity. Here's my annual list of predictions for

trends in the hotel industry in 2010.

1. Hotels to rival used-car salesmen in price integrity. Attempts to curb rampant discounting in 2009 by

offering value-adds like free breakfast and parking will prove futile in 2010 as hotels panic over weak

demand and drop rates even further -- without taking away the value-adds. Meanwhile, a prized

mathematician at Cornell proves once and for all that discounting does notincrease demand, but is

denounced by the hotel industry, who announce another fire sale -- third night free!

2. Hotels shoulder burden of bargain-hunter economy. Airlines, who stopped fussing over trifles like

customer satisfaction years ago, will counter periods of weak demand by simply canceling flights and hiking

fares. Car rental companies, who apparently missed the memo about the Great Recession, will continue to

charge premium rates for substandard cars. Meanwhile, travelers will expect bargain rates from hotels while

refusing to tolerate lapses in quality and service.

3. Bungled bundling. In an attempt to offset losses, hotels will craft packages more complex than cell phone

plans, hoping to confuse travelers into paying higher rates, but will end up only confusing themselves andgiving away even more.

4. Flagrant spending is back! (just not for you). Luxury went mass-market in 2008, then in 2009 became a

symbol of shame and excess after people discovered credit has limits. Now it's set to make a comeback --

as a niche market. The glamorous world of private jets and champagne Jacuzzis will revert to its originally-

intended audience: billionaires, royalty, celebrities, bankers and hotel doormen.

5. Lifestyle: the new luxury. Filling the void created by conversions of luxury hotels into RV parks, lifestyle

hotels will open at a rate of one every 3.7 seconds. Brought to you by the big-box chains, these boutique

knock-offs will cater to the conscientious traveler's demands for eco-friendly practices (as long as it doesn't

cost more), social responsibility (provided no extra tipping expected), and affordable style (quirky patterns

and garish colors that will have guests screaming for the days of all-beige hotel rooms).

6. Hotels join the social media conversation. No longer willing to remain silent while guests misbehave and

then post nasty, biased reviews on TripAdvisor, the hotel industry will launch a website of its own called

DickAdvisorTM

. Employees will post candid reviews of guests, rating them on manners, tipping, honesty,

brainpower and tidiness, as well as providing details regarding alcohol and porn consumption, late-night

visitors and missing and damaged hotel property.

7. Travel goes virtual. Advances in mobile phone technology will allow travelers to check in to hotel rooms

remotely, raid the mini-bar, sleep, attend a meeting, and check out, all without leaving their home.

8. Safety first, service second. Faced with threats from the swine flu, terrorism and reverse peephole

viewers, hotels will install full body scanners at check-in to weed out terrorists, virus carriers and pervs and

redirect them to the nearest competitor. Employees will use hand sanitizer sprays like mace to keep sniffling

and leering guests and other vermin at bay, with a special fire-extinguisher format for groups.

9. Heavenly Deathbeds. As the economy recovers, nonessential amenities will creep back, and hotels will

resume the quest to build the ultimate bed, adding "essentials" like 3,000 thread-count sheets and

seventeen varieties of pillows. This trend will take a tragic turn, however, when a hotel guest discovers a


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room attendant buried deep within the layers of his bed, having suffocated there while attempting to make it.

Thereafter, hotels will strip beds down to a mattress and pillow, charging a fee for everything else.

10. Vegas is out, Iowa City is in. The corporate meetings segment will rebound in late 2010 with a new era of

cost-consciousness in the wake of the "AIG Effect". Popular excursions like all-night tequila-and-stripper

blowouts in Vegas will be replaced with authentic experiences like cabbage soup cook-offs and quilt-making

in the Amish heartland

trends that will shape the future of hospitality sector are

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