Meeting the accommodation needs of the corporate traveller

By Niklas Andreen, SVP of Hospitality at Travelport

Hotel booking is big business and, according to Euromonitor International, hotel booking value is projected to grow from $480 billion in 2013 to $600 billion in 2017. This is in part due to growth in the corporate travel industry and, according to forecasts by the GBTA, 2016 is set to see an even greater increase in spending on business travel.

This is partly because business travellers now expect the same booking experience and choice they have seen evolve in the leisure travel space. They want a fast, seamless booking and payment process including the ability to not only book chain hotels but independents too. They want to review and choose between prepaid and pay on departure rates, rates including ancillary options and they want to see where on a map their choice of hotel is. And they want all of this comparability offered simply through a traditional offline agent, a corporate booking tool or based on their approved booking process. There are plenty of opportunities out there for corporate travel agencies that can meet these demands, so what does it take to maximise success in these areas?

1. Offer more choice of hotel content
   To meet the demands of the corporate traveller, corporate agencies need to focus on expanding the depth and breadth of hotel content they offer, in order to stay ahead of their competitors and really add value. For Travelport, this has meant us building a hotel portfolio of 650,000 properties and offering that to our travel agency community.
2. Focus on seamless booking process: In such an increasingly competitive industry, it’s more important than ever for corporate agencies to streamline their booking process and provide a seamless experience at the point of sale and beyond. This includes including items like TripAdvisor ratings, comparable rates and maps in the booking process so that the traveller doesn’t have to ‘go surfing’ or wait while their agent does the same to find the information. Interestingly, a customer is four times more likely to buy from a competitor if the problem is service related versus price or product related[1]. Offering the best customer service and the ‘personal touch’ should continue to be a key focus, especially as 76% of consumers say they view customer service as the true test of how much a company values them[2].
3. Embrace new payment methods: We see a big opportunity in the area of alternative virtual payment methods due to the key benefit of mitigating against fraud associated with card payments, which a total of 62% of organisations have experienced[3]. Virtual payment methods are also simpler and more efficient, which also helps achieve a seamless booking process.

How to maximise opportunities

By working with Travelport, corporate agencies can offer their customers more choice to drive those bookings as we provide a greater volume and diversity of hotel content than any of our competitors. We have around 650,000 properties, a number of the world’s major hotel chains connected to us and we also integrate content from over 20 hotel aggregators. Additionally, with corporate travellers booking more independent hotels than ever before, we have partnered with HRS, to bring more than 60,000 independent hotels onto our platform.

For customers that don’t have complex air travel needs but still book hotels, for example national businesses which have sales consultants visiting customers, we have also invested in a cost efficient hotel only Corporate Booking Tool, Travelport Hotelzon. For corporate booking tool providers and online travel agencies, our Universal API allows them to pull together content delivered from multiple sources into a cohesive display. This allows for more effective search, comparison, reservations and payments. This product is used by some of the world’s largest online travel agents to offer a similar choice and breadth in a world where travellers are doing an increasing amount of travel booking themselves.

As well as offering the right hotel content, to offer a seamless booking process we also need to effectively solve the need for quick, simple and secure payment methods. Travelport has therefore invested in this area to meet these needs and our corporate agency customers can take advantage of highly beneficial alternative payment options for airfares, hotels and cars. These include Conferma hotel billback and eNett Virtual Account Numbers (VANs), allowing end-customers to pay for airfares or hotels without using their personal or business credit cards. These payment methods simplify payments, reconciliation and commissions compared to traditional cards, while facilitating safer and more cost effective payments to travel providers.

1. Bain & Co
2. 2015 Aspect Consumer Experience Survey
3. AFP Payments fraud and control survey

STR: US hotel performance for June 2016

HENDERSONVILLE, Tennessee — The U.S. hotel industry reported positive results in the three key performance metrics during June 2016, according to data from STR.

Compared with June 2015, the U.S. hotel industry’s occupancy was nearly flat (+0.3% to 73.1%). Average daily rate for the month was up 3.5% to US$126.14. Revenue per available room grew 3.8% to US$92.17.

“June RevPAR growth was the second highest monthly increase this year, and that is obviously a positive indicator for the rest of the summer,” said Joseph Rael, STR’s director of financial performance. “June also helped round out the second quarter, which produced improved results from a soft first quarter.”

Also during June, year-to-date demand growth (+1.6%) moved ahead of supply (+1.5%).

“It appears that slowing demand growth may be the larger issue than supply growth this year,” Rael said. “Demand growth was up 3.0% during this same time last year, and while supply is certainly up, demand growth has slowed considerably.”

Two Top 25 Markets recorded a double-digit increase in RevPAR for the month: Nashville, Tennessee (+11.3% to US$122.24), and San Francisco/San Mateo, California (+10.6% to US$227.60).

“San Francisco’s occupancy topped 90%, but RevPAR growth was driven by a 9.8% rise in ADR,” said Alison Hoyt, STR’s director of consulting & analytics. “RevPAR growth in Nashville, on the other hand, was more evenly split between occupancy and rate growth, with demand (+5.8%) trending well above the national average.”

Houston, Texas, saw the steepest decline in RevPAR, down 9.5% to US$67.70.

Denver, Colorado, posted the largest rise in ADR, up 9.9% to US$141.33.

Philadelphia, Pennsylvania-New Jersey, reported the largest drop in ADR, down 3.1% to US$138.27.

Phoenix, Arizona, experienced the largest increase in occupancy, up 7.5% to 62.2%.

Houston reported the largest occupancy decrease, down 7.7% to 65.6%.

Absolute occupancy in San Francisco/San Mateo (90.9%) was the highest of any of the Top 25 Markets in June.

New York, New York, posted the highest absolute values for ADR (US$273.44) and RevPAR (US$245.11) for the month.

“Overall, the Top 25 Markets (RevPAR +2.6%) underperformed all other markets (RevPAR +4.5%) in June, mainly due to a 0.5% occupancy decrease in the Top 25,” Hoyt said.

A note to editors: As of 1 March 2016, all references to STR data and analysis should cite “STR” as the source. Please refrain from citing “STR, Inc.” “Smith Travel Research” or “STR Global” in sourcing as those names no longer fit within the updated STR brand.

Additional Performance Data

Are you a member of the media looking for performance data for a hotel market not included in this release? STR’s sample comprises more than 54,000 hotels and 7.3 million hotel rooms around the globe. Please refer to the contacts listed below for additional data requests.

Early Check In: What Does It Really Deliver?

Whether guests check in remotely before arrival or show up way before check-in time – room availability makes everyone toe the line

By Mario Bellinzona, Commercial Relations at hospitalityPulse

Lately I’ve been wondering if mobile check-in is all that it’s cracked up to be. Sure, it’s supposed to zip me from the front door to my room, but depending on the hotel I choose, the time of day, whether I arrive earlier or later than planned, and many other factors, the direct-to-your-room experience doesn’t always deliver on its promises.

As a frequent traveler myself, I often wonder if other travelers feel as I do about mobile check in. Not only am I unsure if I like it, but I question whether or not it provides any advantages. One thing is certain, whether travelers like mobile check in or not, studies show travelers “say” they want it.

Business travelers especially seem hip to the idea of skipping another queue – me included. Not every “check-in before arrival” process avoids the front desk, but many do offer an express line to grab your key and go to your room. If this isn’t offered, a mobile key program may work even better; here my cell phone becomes my room key and it enables me to bypass the front desk altogether. Regardless of how I skip the traditional check-in process, mobile check-in programs are geared to help eliminate, or significantly reduce, the time spent waiting in long lines to get my reservation processed.

When given the option to skip registration and avoid the front desk, I take it. For one, it makes me feel good and gives me a shot at accelerating check in; and two, I have a certain level of professional curiosity to see how the hotel or brand is managing this process. Now, in the rare instance that my phone is turned into a magic room key that unlocks my room door and I can bypass the front desk altogether, I am elated! But . . . when I get into my room, my feeling of delight quickly begins to change.

I didn’t realize the hotel had a club, and I forgot to specifically ask about a quiet room – that my bad. However, I also didn’t get the room type that I requested when I made the reservation. I specifically requested a room on a higher floor, away from noise such as from elevators and vending machines, the pool or other distractions. Also, the room had a bath tub and not the shower I asked for. Instead of the King bed I booked, I was given a Double Double.

Several questions now come to mind:

• Is the price that I pay for mobile check in convenience a compromise in choice or fulfillment of my preferences?

• Would I have received a better room, had I checked in later or at the front desk, where I can be presented with options and maybe even sweet-talk my way to a better room-type category?

• Did my advance check in before my arrival just cause me to be given one of the first rooms that became clean on my day of arrival – rather than a room I really wanted?

• As a loyalty member for that brand, did I receive the upgrade I am entitled to? As it is based on availability, what is the point in time that validation is made?

Suddenly I realize that my time in this room is precious – and the many hours I have until the next morning seems a lot compared to the minutes I saved during check in. Does this make me want to wait in a queue again?

Time Saved vs. Overall Experience
As a professional in the lodging industry, I know of course that much of the time savings aren’t really savings at all, but rather shifts in time – a spreading of the workload. The night shift may be able to now do even more to prepare the arrivals. But once you get to the hotel, is your pre-assigned room really ready, or will it need to be changed a few times over to allow even earlier arrivals to get to their rooms so they aren’t just waiting in the lobby? Is there a better way to make the entire process more fluid and more precise, regardless of your method of checking in?

Working in the hotel technology space, I am interested in the hotel’s perspective. How does the front office team cope with the new mobile check in functionality? Is the time I saved as a guest time they save in operations as well? Does hotel management see a rise in guest satisfaction and loyalty? How often do guests still need to see a front desk associate because of issues with the key, the process, or the room itself? In the end, is this all about mobile check in or about not wanting to wait in line needlessly?

Having talked to many room operations staff over the last year, it is clear that the fundamental requirement of a good mobile check-in solution is not the ability to show the right room (or any room number for that matter) at the time of check in, but rather to automate the underlying reservations in queue. It is not possible to predict actual check-in time, nor is it possible to predict which of the rooms that were occupied when the mobile check-in occurred (generally up to 24 or 48 hours in advance) would be ready, vacant and clean to check into at that unpredictable time of arrival. Add to that the important question of priority. Is the most fitting room the one that should be given to a guest checking in early, or from a mobile device? The most valuable guests often arrive the latest, but should they really be the ones to have the leftover rooms?

For those reasons, I think it is important that we recognize not only the promise of mobile check-in, but also the challenges it helps uncover. Rather than dismissing these as side effects stemming from still low adoption or missing smartphone locks, we need to embrace these failures and think about using the resulting insights as a guide to addressing the real underlying challenges.

A recent Skift article titled: “This Is 2016. Why Can’t We Still Book Specific Rooms in a Hotel?” poses a very insightful question. The article quotes a mobile check-in vendor who clearly recognizes that the underlying issues lie with room selection, room assignment, and the impacted fragmentation that room selection/assignment can have on overall occupancy and RevPAR. As an industry, it’s time we deal with these critical questions.

STR: US hotel results for week ending 4 June

HENDERSONVILLE, Tennessee — The U.S. hotel industry reported mostly negative year-over-year results in the three key performance metrics during the week of 29 May through 4 June 2016, according to data from STR.

Affected significantly by a Memorial Day calendar shift, the industry’s occupancy decreased 6.8% to 64.6%. Average daily rate was flat at US$118.45. Revenue per available room dropped 6.8% to US$76.56.

Every Top 25 Market experienced a decline in occupancy for the week. Thirteen of those markets reported an increase in ADR, and eight saw RevPAR grow for the week.

Norfolk/Virginia Beach, Virginia, posted the largest increases in ADR (+7.4% to US$111.76) and RevPAR (+5.9% to US$68.00).

Minneapolis/St. Paul, Minnesota-Wisconsin, reported the largest decreases in occupancy (-21.7% to 60.9%) and RevPAR (-29.4% to US$64.43). ADR in the market was down 9.8% to US$105.79.

Four additional markets experienced a drop in RevPAR larger than 20.0%: Boston, Massachusetts (-25.6% to US$145.59); Houston, Texas (-24.3% to US$58.62); New York, New York (-21.9% to US$206.87); and Seattle, Washington (-20.8% to US$110.93).

Two markets reported a double-digit decrease in ADR: New York (-15.7% to US$245.60) and Washington, D.C.-Maryland-Virginia (-10.8% to US$140.13).

After Minneapolis/St. Paul, three other markets saw occupancy fall by more than 15.0%: Houston (-18.2% to 59.3%), Boston (-18.0% to 73.9%) and Seattle (-15.1% to 73.8%).