Hotels Adopt Airline-Style A La Carte Pricing Strategy
The hotel industry is increasingly adopting an airline-style a la carte pricing strategy, reflecting a shift in how travelers book accommodations online. Guests can now enjoy personalized experiences by selecting additional amenities that enhance their stay. This approach mirrors the purchasing process for airline tickets.
Revolutionizing Hotel Bookings
Travelers can opt for various upgrades such as early check-in, late check-out, and room preferences like views and bedding. For instance, a hydration station with bottled water may be added to the room cost, along with treats for pets or children. This flexibility allows hotels to increase revenue by letting guests tailor their experiences.
Innovative Technologies at Work
AI and other technologies are transforming hotel operations into retail-like experiences. For example, Lakehouse Inn in Lee, Massachusetts, utilizes an AI booking platform that matches guests with specific room features. Co-owner Kurt Inderbitzin notes that this method allows guests to specify their preferences, enhancing satisfaction.
- 14% of U.S. hotel guests are willing to pay for better views.
- 11% are willing to pay for rooms on higher floors.
Some travelers may feel overwhelmed by additional charges for amenities once deemed complimentary. In contrast, others readily pay for extras that enhance enjoyment. Leadership brand strategist Anne Taylor Hartzell, for example, willingly splurges on a better view or a chilled bottle of bubbles.
Examples of A La Carte Offerings
At the 79-room Inn at the Market in Seattle, guests can prepay for a bouquet of flowers or gourmet macarons in their rooms. Despite only 5-10% of guests opting for such amenities, they represent a significant revenue boost, as stated by marketing director Jay Baty.
Columbia Hospitality manages multiple properties that have integrated upgrade options into their booking processes. For instance, the 73-room Wren Hotel in Missoula, Montana, offers personalized flower arrangements and coffee stations. Meanwhile, in Walla Walla, Washington, the Finch Hotel provides unique treats like s’mores kits.
Large Chains Embrace Innovation
In 2024, more than 5,000 Wyndham hotels implemented technology that allows staff to text guests with tailored add-on offers before check-in. Options range from early check-in privileges at various locations to personalized gift baskets. Scott Strickland, the chief commercial officer at Wyndham, emphasizes that successful hotels provide value with reasonable add-ons.
Major hotel chains, including IHG Hotels & Resorts, Marriott International, and Hilton Hotels, are similarly expanding their ranges of optional amenities. This trend speaks to the evolving landscape hotel businesses face amid competition from vacation rental services like Airbnb.
Challenges Ahead
As hotels explore additional offerings, they must ensure consistent delivery on promises. Henry Harteveldt from Atmosphere Research Group cautions that hotels need to maintain quality in their added services, such as ensuring fresh produce and arrangements are excellent. This leads to a crucial question: just because technology allows for various options, does it mean hotels should provide them?
