LODGING CONCEPTS Lodging: A place to sleep for one or more nights

•Front of the house: Any area of the lodging property which may be used by the guest such as restaurants, meeting rooms, and workout facilities •Back of the house: Departments/areas not usually seen by the guest such as human resources and accounting Lodging properties are classified by…

•Price •Level of service •Type of guest •Amenities •Location* Lodging properties

•Resort hotels •Casino hotels •Airport hotels •Luxury hotels •Convention hotels •Vacation ownership/timeshare •Extended stay hotels •All-suite hotels •Motels •Bed and Breakfast Lodging properties

•Commercial or Transient •Boutique hotels •Economy hotels Resort hotels

•Located in areas known for •Many offer package deals desirable weather, scenery, recreational activities •A remote location is often part of the attraction •May be located near natural attractions •Originally catered to leisure travelers, but have expanded •Many add recreational to include facilities conferences/meetings •Some are only open during •Average length of stay 4-7 high season days Resort hotels (cont.)

•Guests are “captured clients”; resort provides full complement of services •Staff has more direct contact with guests, thus must be well-trained staff •Promote repeat business and detailed knowledge of a guest’s preferences Airport hotels •Room service and •Located in and around restaurant hours may be airports extended to •Provide convenient lodging accommodate travelers’ for guests with early flights schedules or for those between •Convenience is major connections factor •Most guests are business •Properties offer free travelers; some leisure shuttles to and from travelers (70:30 ratio) airport Airport hotels •“Distressed” rooms are for passengers who are sent to a •Busiest time of week is hotel for the night because Monday-Friday their flight cannot get off •More availability on the ground. weekends; packages may be offered to attract guests during this time •Crew rooms are contracted to airlines for their pilots, flight attendants, etc.; airlines pay for rooms whether they are used or not.

Convention hotels •Public areas large •Facilities designed to meet needs enough to of groups holding meetings, trade accommodate crowds shows, or large conferences •Attendees usually •Attendees can come from a dine at the hotel single state or from around the world •Large number of guest rooms, multiple meeting rooms, and banquet facilities Convention hotels

•Services offered include: Airport shuttle Room service Business center In-house laundry Extended stay hotels •Full kitchen facilities •May provide stores, •Designed for guests business centers, and staying for a long period of recreational facilities time •Guests may be business people staying in a city for an extended period of time or families or individuals who are relocating •Reduced rates offered based on length of stay

Motels

•Often several are grouped together off a highway exit •Parking located close to room •Facilities may be •Entrance to room is from limited to pool and outside vending machines •Décor is casual •Location convenient •Rooms small but adequate for highway traffic •Ratio of employees to guests is low Casino hotels •Adult and family entertainment provided •Trying to expand market segments to include families and conventions •Gaming areas for adults only •Programmed activities provided for children •Rooms have work space for conference attendees Luxury hotels •Services include: •Concierge, valet, bellhops •Charges highest prices •Food & beverage outlets •Guests expect a •Laundry service high level of service •Beauty salons •Appeal to •Health spas business and •Secretarial services leisure guests •Ballroom Vacation ownership/timeshare

•Guests buy a unit for a set •Accommodations are period of time each year high quality •Time period usually broken •Owners may be able down in terms of weeks to swap vacation •Vacationers contract at a destinations with other certain rate for their property timeshare owners so so they don’t worry about they can visit different fluctuating prices destinations All-suite hotels •Public areas are minimal to provide •More space than typical extra suite space hotel room •Suites approximately •Additional space is 1½-2 times size of lounge/living area and average hotel room kitchen •More space at a lower cost than the high price of a suite in a full-service hotel

Bed and Breakfast •Prices and dwellings vary •Alternative to traditional and reflect the lodging facilities distinctiveness of the •Private homes offering a region limited number of guest •“Homey” rooms •Friendly atmosphere •Owner lives in the home and is host/hostess to •Guests primarily leisure guests travelers •Owner often only •Rate usually includes employee lodging and breakfast Commercial or Transient •Average stay 2-3 nights •Business guests during the week and leisure guests on the weekends •Examples: Marriott, Sheraton, Doubletree Boutique hotels •Appeal to both leisure and business travelers •Properties of 150-200 rooms •Usually located in major metropolitan areas •Highly personalized and high on technology Economy hotels •No meeting space or restaurant •May serve a continental breakfast •Usually very limited service •Appeal to travelers with budget constraints Amenities: Gratis features that enhance a guest’s comfort or convenience; the higher the level of service, the more amenities that a guest expects.

•Double sinks •Pools •Bathrobes •Microwaves •Coffee pots •Shampoo/conditioner •Whirlpool tubs •Lotion •Data ports

Factors that affect lodging rates

•Perishability of rooms •Peak prices vs. off- peak prices Perishability of rooms •Rooms are perishable products. •When rooms are not occupied on a particular night, there is no opportunity to make up for lost revenue. •After considering competition, costs, and profit goals, properties may offer special rates/packages to offset the chance of empty rooms. Peak prices vs. off-peak prices

•Demand for rooms affects prices. •During peak periods, guests are willing to pay more for rooms. •During off-peak periods, guests expect to pay less. •The process of varying rates to maximize profit is “yield management.” Guest rates

•Rack rates •Corporate rates •Group rates •Government rates •Senior citizen rates Rack rates

•Standard rates quoted to walk-in guests and general inquiries •Usually the highest rates charged for a specific room Corporate rates

•Rates given to business people that frequently stay at the property •Usually 10-15% lower than rack rates Group rates

•Available to large groups that book a minimum number of rooms •Group bookings are efficient for the hotel, and group sales tend to encourage repeat business Government rates

•Offered to state or federal government employees •Based on the current daily allowance known as a “per diem” •Encourage repeat business with those qualified guests Senior citizen rates •Discount rates are designed to match seniors’ limited income. •Senior citizens represent a sizeable market of travelers. •AARP: A nonprofit membership organization dedicated to focusing on the needs and interests of persons 50 years of age and older; many lodging properties offer special discounts to members. Trends in the lodging industry 1. Senior market will continue to grow. 2. Security is an important issue. 3. Families are traveling together, creating a demand for a variety of amenities for different ages. 4. More travelers are using internet to make reservations. 5. Travelers are taking shorter trips more frequently, rather than extended trips, due to demands of work. 6. Business people expect rooms to be equipped for technology. 7. More women are traveling for business.

Marketing strategies in the lodging industry

•Advertising •Personal selling •Sales promotion •Public relations/publicity Advertising in the lodging industry

•Specific advertising media can enhance the image and trustworthiness of a business. •Many national companies utilize television advertising to reach large audiences. •Properties are able to target specific groups through publications. Personal selling in the lodging industry •Takes place on many levels (front desk, restaurants, housekeeping, etc.) •Personal contact provides immediate feedback and gives customers satisfaction from being able to talk directly to someone. •Knowledgeable sales people have the opportunity to build profitable relationships by greeting returning guests in a personal manner and by remembering guests’ specific preferences. Sales promotion in the lodging industry

•Coupons •Contests •Premiums •Added extras •Frequent-guest award programs Frequent-guest award programs: A technique that awards free accommodations, upgrades, and other prizes to guests after they spend certain numbers of room nights with the lodging chain. This promotion promotes a long-term relationship with the guest.

•Membership is usually free. •Guests receive priority check-in. •Points may be applied to other travel and tourism services; these partnerships enhance the benefits of membership. Public relations/publicity

•Requires planning and coordination in order to be effective •Examples: announcing openings of new properties; Marriott receiving the top hotel chain ranking in Business Week’s survey in 2003; “Conserving for Tomorrow” initiative at Holiday Inn