Week 26 - Booking is a gatekeeper now.
A&O cut 77% CO2 emissions, Luxury hotels up/Budget down, Upcycling wallpaper and more!
TLDR:
This week in hospitality, luxury hotels show a slight rise in performance, contrasting with budget hotels experiencing a decline amid economic pressures. Booking.com faces regulatory challenges in the EU, potentially impacting its operations. Expedia plans European expansion, focusing on AI innovation and loyalty programs. Lufthansa announces a new sustainability fee starting 2025 to offset environmental costs. A&O Hostels achieves a 77% reduction in emissions and aims for carbon neutrality next year with a €20 million investment. Externalities include YouTube negotiating music rights for AI training, Julian Assange's release, and the first debate among US presidents. Academically, ChatGPT proves effective in review analysis. For readers, a recommended book explores the creation of Airbnb. In tips, Brenners Park Hotel demonstrates sustainability through upcycling, while AI tools offer revenue management, virtual consulting, and guest communication solutions for hoteliers.
0. News snippets
Not important enough to expand on, but worth hearing about
You can find lease & purchase opportunities of entire hotel properties on Ebay | Record amount of bankruptcies since 2016 in Germany | Thailand extended free accident insurance for international travelers | New International Travellers report is out by ETC
0.5 Follow up
Where we follow up on news from previous weeks
Reports, reports & more reports
On the topic of reports. Another one released by Mews. This time touching on US and guests attitude towards digital check-ins. 80% of respondents wouldn’t mind it. AND, 36% have “admitted” to go to AI models to plan their holidays. That is a pretty hefty number. The report goes into workaction and other topics, in case you are interested.
Tourism industry in Ukraine (Status Quo)
In case you missed it, Ukraine is currently undergoing a war! What trends can be seen as a result?Security is the new luxury, with hotels now featuring shelters, generators, etc. As foreign visitors drop off, hotels are wooing local tourists, business travelers, and internally displaced persons like never before. Seasonality? Gone. Mountain resorts are now bustling year-round thanks to movement restrictions and closed sea coasts. Hotels are doubling as offices, coworking spaces, and even children's camps during power outages. Inclusivity is the name of the game, as hotels upgrade to accommodate a rising number of disabled guests from war injuries. Embracing technology like never before, they're rolling out online registration, mobile keys, and smart home systems, while ensuring uninterrupted service with satellite Internet and generators. Finally, demand for aparthotels and service apartments is rising, as families prefer renting over buying new homes amidst the chaos. More here.
1. Main Hospitality News
Core news related to the industry
Luxury is up, budget is down
Depends on which side you are, the news are either positive or negative. Luxury hotels are slightly up 1.8%. While budget hotels are down 3.4 %. Why? Budget travelers are more affected by inflation and are saving as a result. While richer folk were able to gain from stock price increases and home valuations. Forecast is for that to increase further. More here.
Booking.com is in trouble
Congratulations to booking for becoming a “gatekeeper” according to EU regulators. Almost like a troll on a bridge, EU has decided booking.com is simply unsurpassable. Hence, they might have to start listing hotel’s own rates on their website as a form of giving alternative to travelers? What about other OTAs? Well hard to force the rest since their HQ isn’t in EU. Easy to say, Booking.com CEO isn’t too excited. More here.
On that note, booking is removing “No Refund” rates for its partners, unless you use their payment system. Meaning, even though the guest might have booked 3 months ago and cannot cancel, the money can only be charged from booking virtual cards on the day of arrival. A good way to promote partnership friendly environment. More here.
Expedia going to Europe
Another OTA on the list today. Surprise surprise! Expedia is planning to grow. How? You won’t guess it. AI. Innovative tool building that every other OTA is using too. The question is what makes any OTAs AI different if everybody is starting to offer it? Perhaps the answer is, if you won’t you will miss out. FoMo is a powerful thing. On the agenda is also a loyalty program and centralization. More here.
Lufthansa mandating sustainability fees
Lufthansa is charging a sustainability fee, starting 2025. They did already offer a fair that would offset CO2 emissions (at least partially), but now “due to government regulations” the airline group is going to pass on the costs to all travelers. Next thing you know, Lufthansa employees are wearing “Flew with Lufthansa, Saved the planet” t-shirt. More here.
CO2, no thanks?
Imagine being CO2 free as a property operator? Pipe dream right? Well A&O hostels has managed to cut its emissions by 77%. And is planning to bring it down to 0 next year. To achieve that goal, staff is being trained and perhaps more importantly, A&O properties are getting a 20 million Euro investment to achieve that goal. A nice way to put a spin on a renovation! Regardless a more than 2/3s cut is impressive. More here.
2. Externalities
Econimics, finance, geopolitics. All have an impact on the hospitality sector.
What happened this week that is worth mentioning?
Youtube is negotiating with big labels to use music to train AI → AI music to the masses it is!
Julian Assange is free and has landed in Australia, by hiring a private jet. When is the next leak due?
3. Academia
Scientific papers related to the topics above. For those who want to know for sure ;)
ChatGPT for review analysis?
A recent paper went into using ChatGPT as a review analysis tool. ChatGPT was compared to older methods that were previously used to go into sentiment analysis and general breaking down of textual content. Guess what, ChatGPT won. So get on their platform now, ask it what you need and get to it. From our personal experience, processing really really high amounts of data is difficult, however if you own a small hotel with a few hundred reviews, this tool is perfect for you!
4. Readables
Books, podcasts & the big stuff.
Since OTAs made the news today, here is a recommendation for a book about Airbnb. Or the creation story so to speak. Full read available here.
5. Tips & Tricks Tools & SaaS
Any new software you can use? Industry tricks you missed?
Be eco, recycle your wallpaper
How can a hotel implement sustainability measures beyond: “Please do NOT DROP THAT TOWEL ON THE FLOOR”? Here is a fine example from a 5 star hotel in Germany. The Brenners Park Hotel & Spa has up cycled their old wallpaper and turned it into notebooks and is planning to do the same with its curtains, by turning them into pillows, vests and more. While probably a more expensive solution than buying new materials (in case you are low on cash) and perhaps not even such a high CO2 offsetting measure (no figures were mentioned in the article), yet still a good gesture? More here.
3 AI tools for hotels
On the topic of AI, here are 3 tools that “actually” making a difference for the hoteliers. One is a revenue management tool, another a virtual business consultant and the third is guest communication & check-in tool. More on them here.