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State of the Room Study Finds Hotels Close Centur in Perhaps Best Shape Ever
Report Confirms Technology is the "Hot" Amenity
HORSHAM, Pennsylvania; March 20, 2000 - North America's hotel rooms in 1999 were arguably in the best shape of the decade and perhaps the 20th century, and are doing a better job of meeting guests needs according to the first annual Lodging Industry State of the Room 2000 Study, compiled by LRAWorldwide.
The study addresses the state of hotel guestroom product, services, amenities, technology, operational issues and investment. The comprehensive report is based upon a combination of personal assessments/inspections, observations, interaction and research conducted at client and non-client hotels, at more than 1,200 upscale/first-class, full-service North American properties during 1999. These hotels account for more than 330,000 guestrooms and include hotels from every major lodging company that owns, manages or franchises brands in this category, as well as a number of smaller branded and non-branded upscale hotels.
"Thanks to an extended boom in the North American economy and limited new supply in the upscale sector, hoteliers have invested heavily in order to upgrade their hotels over the past five years," commented Robert Rush, president and CEO of LRAWorldwide. "Owners and managers have invested billions in renovations during this period to keep their products fresh and new. In addition, lodging brands are adding new amenities and technology, especially in the guestroom area, in order to meet travelers increasing demands for improved communication, technology and work space. Just as important, hotels are, for the most part, maintaining higher levels of cleanliness and facility maintenance.
"Generally speaking, this sector is the bellwether for the hotel industry. New amenities and services offered here often become standards in the lower priced segments within a few years," Rush noted. "Our goal in compiling this extensive study was not only to gauge where the industry is today, but to determine where the industry is going."
Technology & Communications
While many hotels have been providing guests with access to data ports, the new technology wave - high speed Internet access - is gaining a strong toehold and is most certainly the next "hot" item to help attract and retain guests. Telephones are another area that have been attracting interest and investment.
Connectivity: "Beam me up Scotty, and make it fast" Only one year ago, many hotels were taking a "wait and see" approach to establishing Internet connectivity in guestrooms. Already, more than 16 percent of U.S. upscale hotels surveyed offer dedicated, high-speed connectivity to the Internet, at speeds up to 50 to 175 times faster than a standard 56K dial-up connection. Industry technology experts estimate that some 50 percent of all upscale North American hotels will offer high speed Internet access by late 2001.
Technical Support & Configuration: "I can't get my Internet connection" The 21st century road warrior often can't get adequate help with technical problems configuring and connecting a laptop to their respective Internet Service Provider. This signals an opportunity to provide an easy-to-read in-room telephone/Internet help card for the guest as well as additional staff training to knowledgeably respond to a guest's basic computer challenges. Substantial improvements have been made in reconfiguring guestroom space and furnishings over the past several years. Now, over 78 percent of the guestrooms tracked by the study do not require the guest to disconnect plugs, telephone cords and/or relocate furniture in and around the desk in order to gain access.
The Cost of Technology: "What's this $100 charge for the Internet?" Dedicated, high-speed Internet access from the guestroom is currently an up-charge and likely will remain so for at least another year or two. Costs generally range from $9.95 to $10.95 per 24-hour access period. The cost to dial-up to a guest's ISP is generally limited to the cost of a local call. However, in order to relieve congestion of limited hotel PBX lines and subsidize costs, many hotels are adding a surcharge to the cost of the local call, with the cost averaging $.10 per minute, when connections extend longer than 30 minutes.
Telephones: "With two lines I can now call myself" The study found -that 2-line telephones are currently installed at approximately 20 percent of hotels, with speakerphones installed at 14 percent of hotels. Over 76 percent of hotels now provide two phones-usually one located by the bed and one on the desk.
Guestroom Amenities
Television Coverage: "57 channels and nothing on" Along with the ability to access the Internet via the TV, hotels are relying on the TV to provide guests with access to more and more information, including check-out and billing data, guest satisfaction surveys, hotel information/events, local news and weather, area maps, entertainment guides and airline flight information. More than 50 percent of hotels in the category offer large screen TV's, at sizes 25" or larger. Nearly 75 percent offer more than 10 channels.
In-Room Coffee Service: "Make mine a Latte Mocha Light to go" Following a rough start in its implementation, in-room coffee service has become a guest expectation, and is currently available at almost all of the hotels studied. The industry has overcome concerns regarding the potential loss of F&B revenue, as well as general housekeeping, maintenance, set-up/restocking and safety issues. Newspapers: "All I know is what I read in my free newspaper"
More than 97 percent of hotels currently provide a complimentary copy of a newspaper, delivered to the guestroom. The leader, by far, is USA Today. Other hotels limit newspaper distribution, including The Wall Street Journal, to guests on designated floors or to members of the brands' frequent stay program. A small number of hotels, less than 3 percent, also provide a copy of the local city paper.
Upgraded Floors: "Get me on that exclusive floor, at any cost" Almost 80 percent of the hotels surveyed provide guests with an opportunity to upgrade to a special floor of the hotel that offers added amenities and features. These floors typically provide a lounge, complimentary continental breakfast, evening snacks, and larger work space in the guestroom. The up-charge for these rooms generally ranges from $15 to $30 per night, representing a 6% to 10% rate premium.
In-Room Work Space
"Give me room, lots of room" With travelers spending more of their time working and communicating from their guestroom, there is a keen focus on the adequacy, size, furnishings, comfort, functionality and configuration of in-room work space. The central focus is on the desk, seating comfort, lighting and connectivity.
In-room desks have been slowly increasing in size in response to guests' needs. Look for more ergonomically designed and height-adjustable chairs in guestrooms over the next few years. The adequacy of lighting is also receiving considerable attention as guests demand office-like lighting conditions in their hotel room/office.
Cleanliness, Maintenance & "A Good Night's Sleep" Cleaning: "As much as things change, they remain the same" Despite all the new technology, guestroom cleanliness and maintenance continue to be critical elements in influencing a guest's satisfaction. Consistent execution and attention to detail are key to providing high levels of cleanliness and maintenance. Properties have responded by adding staff, stepping-up training, and introducing new products in order to ensure "zero defect" guestroom cleanliness. Housekeepers indicate their biggest challenges are dealing with hair, dust, stains and mildew in the guestroom. Cleaning remains very much a "hands-on" job. The study found that one of the most pressing issues facing the industry is the difficulty in attracting and retaining qualified workers. The strongest job market in recent memory has forced hoteliers to beef-up recruiting and training programs for housekeepers.
Maintenance: "Getting called on the carpet" Condition of the carpet continues to be a primary challenge in the guestroom. The industry generally replaces guestroom carpeting between five and ten years, depending upon wear patterns, availability of capital, design trends and other issues. In the guest bathroom, the condition and maintenance of the floor and bathtub/shower also are a challenge.
A Good Night's Sleep: "Keep out the light, keep out the noise" In the final analysis, a hotel serves as a place to sleep while traveling away from home, so obtaining "a good night's sleep" contributes greatly to a guest's overall satisfaction. Contributing factors include the quality and condition of the bedset, room lighting and darkening features, heating and cooling and noise levels. Towards this end, hotels spend over $200 million annually on bedsets and typically replace their mattress sets every five to seven years.
Investment
Hotels must continuously invest in and renovate their guestrooms. Typically, four or more percent of annual revenues are allocated for this purpose. A combination of the buoyant economy, strong industry fundamentals and the availability of capital have provided hoteliers with the opportunity to significantly improve their product. More than one in three hotels studied plans to spend over $1 million in property renovations during 2000.
Rush said that his company is expanding the survey in 2000 and welcomes comments and suggested additions to the Second Annual State of the Room Survey.
About LRA Worldwide, Inc.
LRA Worldwide, Inc. is a leading consulting, organizational development and research company that specializes in Customer Experience Management (CEM). LRA helps companies and brands design and deliver the optimal customer experience across all key touch points using an integrated suite of services that measure and improve service quality, customer satisfaction, employee performance, loyalty, customer advocacy and profitability. LRA specializes in "operationalizing the brand" - turning brand promise and customer strategy into operational reality. LRA's CEM practice areas include CEM Strategy Design, Standards Development & Content Management, Organizational Development & Training, Research and Quality Assurance & Mystery Shopping; these are either deployed together in a strategic manner to continually monitor and improve the customer experience or deployed individually to address a specific tactical client need.
LRA's clients include some of the world's leading companies and brands, including Starwood Hotels & Resorts, Hard Rock Hotels & Casinos, the PGA TOUR, Albertsons Supermarkets, the NBA and First Niagara Financial Group. For more information, visit the company's Web site at www.LRAworldwide.com
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