Corporate cost-cutting causing hotels to turn to leisure business

Leisure guests will become increasingly important for hotels in the
post-recession years, according to a World Travel Market sponsored think tank
meeting, held in London last week.

The
WTM’s Meridian Club hotels think tank invited a dozen hotel suppliers and
operators to take part in a wide-ranging discussion at the Emirates
Stadium.

A
recurring observation was that hotels were looking more closely at their leisure
business in response to sea changes in the corporate travel
environment.

Travel
budgets for blue-chips and SMEs were slashed during the global slowdown, the
meeting heard, and the concern for hoteliers is that even if the world economy
picks up, budgets will remain tight.

Although the discussion was held under Chatham House rules, one
luxury hotelier said that many companies were now mandating that their
travellers could not stay in five-star hotels, while a global tour operator said
that his business was now using video conferencing as a matter of course and
that this had now become “learned behaviour”.

A
mid-market operator said that some of its properties in France were no
longer taking bookings from the MICE sector because of the strong demand from
US-based leisure travellers, while another said it was benefitting from business
travellers downgrading.

With
recognition that responsibility for travel budgets was increasingly the
responsibility of the procurement department, tougher negotiations were
resulting.

“Corporations now want Wi-Fi access as part of the deal, and they are
looking for free transfers, free phone calls and discounts on food and beverage
which clearly affects our margins,” said one hotelier, adding: “It is possible
that leisure travellers might now be more profitable than corporate
guests.”

“The
idea behind the think tanks is to give senior executives the chance to talk
openly with one another about their sector,” said Meridian Club Marketing
Manager, Mark Jacobsen. “We will take on board what was said and use it to make
sure Word Travel Market, the premier global event for the travel industry, is
able to service the needs of all players in the challenging and dynamic hotel
sector.”

Paul Colston

Author

Paul Colston

Managing Editor, Conference News & Conference & Meetings World.

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