The Lodging Industry

1. Explain how the travel and tourism industry can be categorized, and classify hotels in terms of
their size and target markets.
2. Classify hotels in terms of their levels of service, and ownership and affiliation.
3. Describe characteristics of business, pleasure/leisure, group, and international travelers.
4. Identify factors that influence travelers’ buying decisions.
5. Describe how hotels can become more ecologically responsible and the incentives they have to
do so.
The Lodging Industry
The travel and tourism industry consist of five parts:
• Lodging operations
• Transportation services
• Food and beverage operations
• Retail stores
• Activities
The Lodging Industry
The hospitality industry
• The hospitality industry is part of the travel and tourism industry.
• The hospitality industry consists of lodging; food and beverage operations; and institutional food
and beverage services.
The Lodging Industry
Classifying Hotels
Hotels can be classified by:
• Size
• Target markets
• Levels of service
• Ownership and affiliation
The Lodging Industry
Hotel Size Categories
• Under 150 rooms
• 150 to 299 rooms
• 300 to 600 rooms
• More than 600 rooms
The Lodging Industry
Target Markets
• Two of the most important marketing challenges for a lodging property are: “Who stays at our
property?” and “Who else can we attract?”
• Lodging properties seek to identify target markets.
• Target markets are distinctly defined groups of travelers that the hotel seeks to retain or attract as
guests.
The Lodging Industry
Types of Hotels, Classified by Market Segment
• Commercial hotels
• Airport hotels
• Suite hotels
• Extended-stay hotels
• Residential hotels
• Resort hotels
• Bed-and-breakfast hotels
• Vacation ownership and condominium hotels
• Casino hotels
• Conference centers
• Convention hotels
• Alternative lodging properties (recreational vehicle parks, campgrounds, mobile home parks,
corporate lodging, cruise ships)
The Lodging Industry
Commercial Hotels
• Located in the towns and cities they primarily served
• Often located near train stations in the nineteenth and early twentieth centuries
• Located in downtown or business districts today
• Largest group of hotels
The Lodging Industry
Commercial Hotel Guest Amenities
• Complimentary newspapers
• In-room coffee makers
• Free local calls
• Cable television, DVD players/DVDs, video games
• Personal computers, high-speed Internet access
• Ergonomic desks and chairs
• Fax machines
• Car rental arrangements, airport pick-up services
• Twenty-four-hour food service
• Semi-formal dining rooms; cocktail lounges
• Conference rooms, guestroom suites, room service, banquet meal service
• Laundry/valet service
• Concierge service
• In-room refreshment centers
• Retail stores
• Pools, health clubs, tennis courts, saunas
The Lodging Industry
Airport Hotels
• First airport hotels built in 1950s as air travel became popular
• Airport hotels are built in major travel centers
• Wide variety of sizes and levels of service
• Target markets: business travelers, airline passengers with travel layovers/canceled flights, and
airline personnel
• Many feature conferences rooms
• Offer convenience, cost savings
The Lodging Industry
Suite Hotels
• Fast-growing segment of the lodging industry
• Feature guestrooms with a living room or parlor area and a separate bedroom
• Some guestrooms include a kitchenette
• Generally, have fewer/more limited public areas than other hotels
• Target markets: people relocating to area, travelers who enjoy homelike accommodations;
vacationing families, business professionals
The Lodging Industry
Extended-Stay Hotels
• Similar to suite hotels
• Designed for travelers who stay five nights or longer
• Usually do not provide food, beverage, or uniformed/valet services
• Housekeeping services may not be provided on a daily basis
• Homelike atmosphere
• Room rates often determined by the length of a guest’s stay

The Lodging Industry

Residential Hotels
• Provide long-term or permanent accommodations in urban or suburban areas
• Located primarily in the United States
• Declining in popularity; replaced in part by suite and condominium hotels
• Guest quarters generally include a sitting room, bedroom, and kitchenette
• In some states, guests who contract to live in a residential hotel are considered tenants
• May provide some or all of the services provided to guests in commercial hotels
• A restaurant/lounge may be located on the premises
The Lodging Industry
Resort Hotels
• Often chosen as the destination or vacation spot
• Usually located in an exotic location away from crowded residential areas
• Usually feature recreational facilities/activities and breathtaking scenery not typical of other hotels
• Usually provide extensive food and beverage, valet, and room services
• Typically feature a leisurely, relaxed atmosphere
• Strive to provide enjoyable guest experiences to encourage repeat business and word-of-mouth
referrals
• Often employ social directors
The Lodging Industry
Lifestyle Hotels
• Appeal to specific travelers who enjoy certain architecture, art, culture, special interests, and
amenities
• Most major lodging companies have entered this market segment
• Reflect the interests of their guests
• Usually have 100 to 250 guestrooms, with limited or no meeting space
• Food service varies from world-class to mid-range
• Building exterior, interior décor, and guestroom design are all important to the success of these
hotels
The Lodging Industry
Bed-and-Breakfast Hotels
• Sometimes called “B&Bs”
• Range from converted small houses to small commercial buildings with 20–30 guestrooms
• Owner usually lives on the premises and serves as the property manager
• Breakfast ranges from a simple continental breakfast to a full-course meal
• Most only offer lodging and limited food service
• Room prices tend to be lower than in a full-service hotel
The Lodging Industry
Vacation Ownership Hotels
• Sometimes referred to as timeshare or vacation-interval hotels
• People purchase ownership of accommodations for a specific period of time (usually one or two
weeks a year)
• If owners do not stay during their time period, they can have the hotel’s management company rent
their units for them, receiving the rental money after paying fees to the management company for
this service
• Owners can trade their ownership time with other owners in other locations
• Each unit has multiple owners
The Lodging Industry
Condominium Hotels
• Similar to vacation ownership hotels
• Units in condominium hotels have only one owner, instead of the multiple owners typical in
vacation ownership hotels
• Owners tell the management company when they want to occupy their units; the company is free to
rent the unit for the remainder of the year
• A portion of the rent from the unit goes to the unit’s owner
The Lodging Industry
Casino Hotels
• Feature gambling facilities
• Guestrooms and food and beverage operations are often luxurious, but they are secondary to the
gambling operations
• Cater to leisure and vacation travelers
• Attract guests by promoting gaming and headliner entertainment
• Provide a broad range of entertainment and recreation opportunities
• May offer charter flights for guests who plan to gamble
• Gambling activities may operate 24 hours a day, 365 days a year
• Some are very large, with several thousand guestrooms
The Lodging Industry
Conference Centers
• Specifically designed to handle group meetings
• Provide all of the services and equipment necessary for a meeting’s success
• Often located outside metropolitan areas
• May provide extensive leisure activities

The Lodging Industry

Convention Hotels
• This segment has grown significantly in recent years
• Often have thousands of guestrooms
• Can have 50,000 square feet or more of exhibit hall space, plus ballrooms and meeting rooms
• Offer a variety of dining facilities
• Primarily directed toward business travelers with a common interest
• A full line of business services is generally available for guests
• Host state, regional, national, and international meetings
• May book business up to ten years in advance
 The Lodging Industry
Basic Issues Pertaining to Service
• Intangibility of service
• Quality assurance
• Rating services
• Economy/limited service
The Lodging Industry
Types of Hotels, Classified by Levels of Service
• World-class service
• Upscale
• Mid-range service
• Economy/limited service
The Lodging Industry
Types of Hotels, Classified by Ownership and Affiliation
• Independent hotels
• Chain hotels
• Management contract
• Franchise
• Referral group
The Lodging Industry
Categories of Guests
Business Travelers
• Business
• Pleasure/leisure
• Group
• International
The Lodging Industry
• Historically, the first and primary market for hotels
• More than 35 million people take business trips each year
• Business travelers average about five trips per year
• Business travelers account for a significant portion of lodging demand
• Hotels design specific products and services for business travelers--meeting space, offices,
secretarial/computer services, in-room safes, 24-hour room service, Internet access
1. 28. Chapter 1: The Lodging Industry • Specialized resort travel • Family pleasure travel •
Travel by the elderly • Travel by singles or couples • Price-sensitive Managing Front Office
Operations PowerPoint 27 Pleasure/Leisure Travelers
2. 29. Chapter 1: The Lodging Industry • Pleasure travel • Institutional meetings/conventions •
Corporate/government meetings/ conventions • Trade associations • Management meetings,
sales meetings, new product introductions, training seminars, professional/technical
meetings, stockholder meetings Managing Front Office Operations PowerPoint 28 Group
Travelers
3. 30. Chapter 1: The Lodging Industry • Different needs and expectations • Language barriers
• Foreign-born employees can be helpful in serving these guests Managing Front Office
Operations PowerPoint 29 International Travelers
4. 31. Chapter 1: The Lodging Industry • Satisfactory experiences with a hotel • Ads by a hotel
or chain • Recommendations by family members and friends • Hotel’s location •
Preconceptions of a hotel based on its name or affiliation • Travel management companies
 Managing Front Office Operations PowerPoint 30a Buying Influences on Travelers
Continued
5. 32. Chapter 1: The Lodging Industry Buying Influences on Travelers Continued from
previous slide… • Ease of making reservations • Hotel’s quality of service, cleanliness, and
appearance • Loyalty to a particular property or brand • Frequent traveler programs •
Website design (for travelers booking online) Managing Front Office Operations PowerPoint
30b
6. 33. Chapter 1: The Lodging Industry • Blogs: publically accessible chronicles or personal
diaries • “B-blog” is a blog dedicated to a business or business segment • Alternative blogs
include discussion forums and e-mail exchanges • Social networking sites facilitate
interaction within an online or virtual community • Social networking sites allow individuals or
groups to create personal profiles to share with others Managing Front Office Operations
PowerPoint 31 Blogging and Social Networking
7. 34. Chapter 1: The Lodging Industry • People increasingly interested in patronizing “green”
hotels • Government agencies, the Association of Corporate Travel Executives seeking
“green” hotels • Green hotel initiatives include: reducing greenhouse gas emissions,
recycling, organic gardening, capturing waste heat from power generators, using renewable
energy sources, and educating guests about environmental issues • Green initiatives are in
place worldwide • LEED certification, Energy Star program • Hotels engaged in energy
management, water management, biodiversity management, and waste management
programs • Green meetings Managing Front Office Operations PowerPoint 32 The Green
Hote