Briefing: Design – Demand and revenue

Hotel design is rapidly evolving to keep up with consumer demands and global trends. When it is done well, clever design can really add to the revenue of a hotel.

The hospitality industry spends annually about $3.7 billion on energy. Initiatives like UNWTO’s Tourism and Sustainable development goals are in place to help companies making good choices. A reduction in room size has emerged as another trend that can save hotels money while maximizing space through design.

In this briefing our experts discuss design drivers and profitability:

The pod or ‘capsule’ hotel concept, originated in Japan where space is exceptionally tight. It is being used mostly in airports and cities. Marriot has taken on board the small room concept in its Moxy brand, which has one hotel open so far at Milan Malpensa Airport. Yotel has hotels in New York, London, and Amsterdam. The successful Pod Hotel from BD Hotels has two hotels in New York, and one planned in Washington DC.

Sustainability has become an important aspect of development in all industries. As one of the worlds’ largest industries Travel and Tourism has a huge footprint.  According to the UNWTO, the industry accounts for 5% of greenhouse gas emissions, and a typical hotel uses 218 gallons of water per day per occupied room. As discussed above, improvements in this area will not only greatly benefit society and the environment, but can reduce outgoings for the hotel.

Although this movement is not driven by the consumer as much as other changes in design, such as social areas in hotels and wifi, studies have shown that guest are very much in favour of sustainability programmes. A study from Cornell University found that three quarters of guests participate in green programs when they are offered at the hotels, and 45% of guests in one hotel in New York said they would be willing to pay a higher room rate for hotel sustainability initiatives.

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Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: 72% of families considering alternatives for holiday accommodation

New research from ExpertFlyer found that 72% of family travellers have either booked a non-traditional vacation accommodation, such as hostels or home and apartment rentals, or would consider it. The popularity of alternative accommodation continues to increase. For example, Evercore found that; ‘the online vacation rental market stands to grow from approximately $30bn to $70bn over the next five years.’

In these videos experts from different sectors discuss the appeal and profitability of their product compared to hotels:

Alternative accommodations not only appeal to markets untouched by hotels but can make better financial sense. Research by design consultancy WATG found that an aparthotel operation is able to drive higher levels of profit per sqm than an equivalent hotel operation (£488 and £442 per sqm respectively). WATG’s research also showed GOP margins of 63% for an aparthotel compared to 49% for hotel operations.

Online distribution has helped open up the market to different types of accommodation. Evercore’s report A Change of Vacation Plans, released in April 2015, states that the online vacation rental opportunity stands at approximately 7% of global bookings, a figure which they expect will increase to approximately 11% over the next five years.

The major distributors of vacation rentals are HomeAway, Airbnb and TripAdvisor. HomeAway has over 1 million listings. TripAdvisor’s Vacation Rental’s business grew from 29% of properties in 2011 to 45% by year-end 2014.

If you’ve been sent to this page and you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do see here. It’s free.

Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: How hospitality companies are evolving into digital businesses

According to CSC’s Leading Edge Forum, less than 4 out of 10 companies are ready to take advantage of the new business opportunities arising from developments in digital technology.

In the hospitality industry there have been some digital successes, and some companies struggling to keep up. A good digital culture needs good leadership and the right partnerships.

In this briefing four hospitality experts discuss building digital into the business plan:

Depending on a business’s resources, ‘becoming digital’ will mean different things, large companies may invest money in new plans and new specialist staff, independents may look into what platforms and partnerships they can use to help themselves.

While digital is changing the way business works, it is also creating jobs and, according to Deloitte, is boosting the economy. A report from Deloitte on the impact of technology on jobs in the UK found that over the past 15 years technology-driven change has added £140 billion to the UK’s economy in new wages.

The report states that ‘In the future, business will need more skills, including: digital know-how, management capability, creativity, entrepreneurship, and complex problem solving.’ Business leaders will already be keenly feeling this need and it will only continue, which is why having a plan that incorporates digital and having people to push this agenda forward is essential.

Research from McKinsey&Company also highlights the need for digital leadership. They found that ‘90 percent of top digital performers have fully integrated digital initiatives into their strategic-planning process.’ They say that there has already been an increase in digital focused executive positions. They found that ‘CDO (Chief digital officer) roles doubled from 2013 to 2014 and is expected to double again this year.’

If you’ve been sent to this page and you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do see here. It’s free.

Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

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