Recently, hotel chains like Marriott and Hilton announced the latest way to earn points and perks from their hotel loyalty programs: daytime rooms. Despite the seedy connotations of this sort of room rental, this in fact represents an innovative new work-from-anywhere program. How will it work, and will it help the hospitality industry recover after the devastating effects of COVID-19?
How the Travel and Hospitality Industry Suffered
For decades, business travel and tourism have shown massive growth and become one of the fastest growing sectors of the global economy. However, that growth came to a screeching halt as the COVID-19 pandemic hit the globe. With the global economy upended, the travel and hospitality industry suffered the hardest.
STR, a global hospitality data enterprise, made a comparison of 2020’s Q1 status versus 2019 figures. It found that hotel occupancy rates massively dropped around the globe following the announcement of lockdown protocols. Most notable are the ones in Italy, which suffered a 96% drop, followed by China (68%), the UK (67%), the USA (59%), and Singapore (48%).
In the US, particularly, STR also found a sharp dip in global hotel performance. Comparing hospitality statistics between May 2020 and May 2019, they report the following:
- occupancy dropped to 30.1%, which is a 55.9% decline from the previous year;
- average daily rate (ADR) dropped to $76.35, a 42.1% decline, and;
- revenue per available room (RevPAR) reduced to $22.95, a massive 74.4% drop from 2019.
The sinking industry needs to find a way to recover, and fast. Fortunately, hotel chains like Marriott and Hilton have found a way to pivot, with the help of their hotel loyalty programs. Their response: a new work-from-anywhere program that offers daytime rooms for rent.
Day Passes and Hotel Loyalty Programs
Traditionally, hotels that offered daytime rooms have been looked down upon by luxury hotels. But now, their offers of day passes by the hour might not be such a bad idea after all.
ADWEEK reports Marriott and Hilton hotels’ latest attempt at creative reinvention by offering day passes with perks from their hotel loyalty programs. Before that, United Airlines already partnered with Peerspace, an office rental company, to offer flight bundles alongside rental office spaces. Now, these travel and hospitality industry giants are offering hotel amenities to customers who are “sick of working from their kitchen counters.”
This new work-from-anywhere program offers hotel guests a room, a desk, and access to WiFi and other hotel amenities for about 25%-50% of the overnight rates. Moreover, day pass users earn recognition and rewards from their hotel loyalty programs.
Peggy Fang Roe, a global officer of customer experience at Marriott, believes this new venture is better than taking no action at all. “We’d rather be iterating in the market with our consumers than just waiting and seeing what happens… I don’t know what kind of volume we’re going to get, but we believe these all represent new demand patterns and new revenue opportunities for the hotels.”
Marriot, in particular, will lean on social media and its hotel loyalty programs’ members, currently at 143 million strong, to spread the word about Marriot’s day use rooms.
Desperate Times Call for… Creativity
Such attempts by marketers to continually develop creative solutions to the radical changes that the marketplace experiences are laudable. Granted, some people might not be open to Marriott’s and Hilton’s idea to offer day passes, even with the promised perks and rewards from their hotel loyalty programs. Home is where the heart is, after all.
However, there will always be those who are working from home under challenging circumstances and environments. A quiet day within Marriott’s day use rooms, with WiFi and room service, would be a welcome respite for such people.
Nevertheless, it is extremely encouraging to find enterprises continuing to tap into their creativity with these new work-from-anywhere programs. Such vitality has always been key to propelling businesses, and society, forward.
What do you think? Let us know your thoughts.