Airlines seem increasingly committed to the idea of luring consumers with low fares then hitting them with fee after fee. Hoteliers should resist the urge to do the same.
The news earlier this week that United Airlines is committed to moving forward with plans to offer discounted fares, but then charge for once-free services like overhead luggage storage, seems to continue a trend within that segment of the travel industry.
Various media outlets used the news to speculate that more airlines soon will do the same, following suit with not just United but an increasing stable of discount airlines like Spirit and Frontier.
That news has been treated somewhat unfairly in the consumer press, since it could actually end up saving a lot of people money if they use it correctly. But I also think hoteliers need to greet the news with a bit of caution.
The idea of luring people in with low rates and then making up the difference by hitting them with small fees seems to make sense from a certain perspective. The low rates will probably get you some additional play on third-party channels like online travel agencies and could drive business in the short term. But I have to assume there would be more long-term implications that I can hardly imagine would be positive.
First, you’d have to consider what exactly a hotel could charge for that which is currently free. Do you slap on a fee for toiletries? What about the use of things like rollaway beds? Additional towels? Or maybe just towels in general?
The catch-22 in all of that is the lower fees would obviously draw a more cost-conscious traveler who would likely take exception to being squeezed for every penny possible while on property. Unhappy guests equal bad reviews, and bad reputation in the hotel industry means bad business.
That doesn’t necessarily mean there isn’t room within the industry for a streamlined—and cheaper—hotel experience for some consumers. Just look at the success of sharing-economy platforms like Airbnb or pod-concept hotels in major metros.
But those offerings are able to cut rate by cutting costs, not by trying to make up the revenue on the back end. That should be where hoteliers’ minds are. If you want to be a discount option, you need to count on only getting a set amount from those consumers’ wallets from the get-go.
After all, hotels are never going to have as captive of an audience as the airlines.
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