Jul162008

Concierge Traveler – Hotel and Travel News

Concierge Traveler – Hotel and Travel News  

I have noticed trends in the hotel industry stories over the past couple of weeks since not posting much while traveling around in San Francisco and Denver.  Here is a selection of interesting travel industry articles I have seen lately.

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I have been writing much of this year on the “perfect storm” of currency exchange economics, perception of declining wealth among Americans and its impact on international travel, and the hotel revenue management teams insisting on maintaining historically record high room rates. 

My conclusion is the trifecta will decrease the room rate inflation for hotels in the U.S. but I anticipate wildly swinging hotel rates for the rest of 2008.  Expect exorbitantly high room rates in major city business center hotels during busy work weeks and peak travel conferences when the hotels will strive for enhanced revenue. Anticipate more frequent hotel room bargain rates during extreme lulls in business travel to induce leisure travel stays. 

The leisure traveler will see great hotel rate opportunities and an increased probability of getting a high value-added incentive like a complimentary room upgrade, free parking, restaurant meals and/or bar drinks, and quite possibly a high added-value rebate through hotel loyalty program bonus points towards a future free night redemption.  Unlike airline frequent flyer miles, hotel programs make room redemption using frequent guest points a fairly simple process.

Rising fuel costs balanced by staff reductions seems to be the business practice for keeping profits rising in the face of declining occupancy and pressure on room rate rises.  Europe is seeing a widespread decline in the American tourist market on the order of 10-15% fewer visitors for places like Ireland this season than last year so far.  The British pound has lost nearly as much value against the Euro in the past year as the dollar – around 15%.  A survey of UK  travelers shows 13% cutting back on travel plans due to weaker value of the British pound in past year.  British tourists are finding less value in travel to Ireland.  British tourists are increasingly favoring Turkey to escape the Euro zone for a beach getaway as even the rising cost of a holiday in Spain pushes bargains aside.

The indicators are that major cities are faring better than outlying regions for tourism such as Budapest.  London, Amsterdam, Paris, and Berlin are still strong attractions for the tourist and business conference market.  Ireland and Scotland are seeing summer tourist fortunes decline.  Still there are analysts saying “there are no decline in business hotels for 2008” and the scenario is not so bad as hotels continue to profit, just to a lesser amount than in previous years and the cut rate bargain hotel rooms may not be coming to your town anytime soon.

Now I am waiting to see the loyalty program response to initiate more interest in hotel travel for the second half of the summer season.  The incentives are nowhere near the high value hotel frequent guest promotions of last fall, winter, and spring.

Expedia has dropped 48% in stock value since October 2007 and the recent announcement of the purchase of Venere.com did not seem favorable to the market.  For the consumer the deal just might be upbeat.  Venere.com has accommodation relationships with nearly 30,000 European and US properties and the acquisition will add more than 10,000 new hotels in Europe, Africa, and the Middle East to Expedia’s reservation system.

More interesting to me is the acquisition of VirtualTourist.com by TripAdvisor.com.  Expedia is moving along as the major player in the hotel travel review and travel media market and now adds a vibrant social media component to the Expedia portfolio.

Hotel stocks and travel stocks in general are taking a hit on Wall Street with many at 52-week lows.  Marriott reports profits are declining in the past few months by a substantial margin of 24%.  Analysts predict that reduced airline capacity may exacerbate the problem of lower hotel occupancy for geographically isolated U.S. cities like Denver, Colorado to an extent larger than the post-September 11 travel slump.

 

Don’t think twice, it’s alright

            – TripAdvisor’s top ten places to show your skin.

Don’t think twice, it’s not alright to slip out of that tan line clothing in Dubai

–         And a tourist asks can you still kiss in public on a Dubai beach? 

 

Hotel Website Redesign and Brand Recognition

HotelChatter.com reaction to the Starwood Hotels’  Luxury Collection website redesign and recent articles on InterContinental Hotels media library, Hilton’s Conrad and Waldorf-Astoria brands are all pieces pushing brand recognition with website enhancements to distinguish these upscale and luxury brands within the corporate hotel family. The St. Regis Fort Lauderdale is being stripped of its brand name affiliation with Starwood Hotels.

Boston and Las Vegas  Coast-to-Cost Blues

Boston hotels predict harder times ahead as fuel costs and operating expense increases cut into diminishing profits.  The hotel rates in Las Vegas are reported to be at their lowest room rates since 2003 in this LA Times blog.

 

 

 

 

About Ric Garrido

Ric Garrido of Monterey, California started Loyalty Traveler in 2006 for traveler education on hotel and air travel, primarily using frequent flyer and frequent guest loyalty programs for bargain travel. Loyalty Traveler joined BoardingArea.com in 2008.

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