Room service, minibars, free parking, even individually wrapped shampoos and conditioners may soon become luxuries rather than standard offerings at many hotels.
Some hotels have already reduced certain benefits. New York’s largest hotel, the 2,000-room New York Hilton, stopped offering room service in 2013, and other hotels are reducing their room service menus. The minibar suffers the same fate: some Marriott hotels are phasing out the minibar in the room and other hotels are considering a similar approach.
For the most part, hotels are making cuts like these to eliminate or reduce parts of the business that aren’t very profitable and that many guests don’t even want. Revenues fell 9.5% from 2007 to 2012 for room service and 28% for minibars, the biggest segment drop in the entire hospitality industry, according to the most recent data. available from KFC Hospitality Research; this compares to a drop of just 0.6% in overall revenue per room. Plus, many guests don’t even like these perks: A TripAdvisor.com survey found that hotel guests said the minibar was the least important amenity for them.
What’s more, guests shouldn’t expect some hotels in the low and mid-price range to just stop at these amenities discounts, experts say. Hotel consultant Melanie Nayer says we may soon see reductions in front desk staff as many hotels explore mobile check-in or kiosk check-in. Plus, “the concierge can be digital – a touchscreen TV with weather, news, attractions, services, and restaurant and entertainment recommendations,” says Bjorn Hanson, divisional dean of the Preston Robert Tisch Center for Hospitality. , Tourism and Sports Management at New York University. Hanson also claims that more and more hotels will stop offering free, even self-parking, in the coming years. “Parking is a very lucrative tax and extra for hotels,” he says; data from KFC Hospitality Research shows that hotel revenue from parking jumped almost 19% between 2007 and 2012, one of the fastest growing segments. And Nayer says some ultra-low-cost hotels could also do away with individually wrapped shampoos and soaps and opt instead for large containers of shampoo, conditioner and body wash.
We can see hotels getting rid of some technology and entertainment options as well, albeit mostly things that guests don’t care about. Jan Freitag, senior vice president of a travel research company STR, says he thinks many hotels will remove on-demand entertainment selections like live movie rentals. “Travelers these days have their laptops and phones and already have all the entertainment they want,” he says. “Guests don’t need all that…they can be entertained.” (Indeed, hotel movie rental revenue fell more than 56% from 2007 to 2012, according to KFC Hospitality Research.) In the next five years or so, we could see hotels phasing out phones for a similar reason: people just don’t use them. (Hotel telecommunications revenues decreased by 37.6% between 2007 and 2012.)
Granted, many hotels, especially high-end ones, are moving in the opposite direction. “The luxury segment will do what it does today and more,” says Freitag. For example, the James Hotel in Chicago recently added selections from health food company 2 Degrees to its minibars, and in Miami it expanded its in-room dining options this year. And many low- and mid-priced hotels replace the amenities they get with other perks. So, for example, while they often ditch minibars and room service, many are offering take-out dining options in small cafes near the lobby or retail spaces with extensive dining options, explains Nayer. And Meliker adds that while they may ditch phones, they’ll likely replace them with another communication device like a smart TV or tablet. The reason: Many hotels are increasing their rates (room rates are expected to increase 4.2% in 2014, according to KFC Hospitality Research) and “generally speaking, when you increase rates, you don’t want to reduce amenities,” says Meliker.
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