06th November 2024: Here are some of the stories that caught our attention over the week with some of our takeaways.
The Rising Phenomenon of Travel Tuesday: What It Means for the Travel Industry: According to McKinsey as published in HNN, Travel Tuesday has emerged as a growing post-Thanksgiving shopping tradition where consumers seek travel deals, benefiting both price-conscious travellers and travel companies looking to boost revenue during a traditionally slow booking period. Started by Hopper and following other shopping days like Black Friday and Cyber Monday, this trend is expanding beyond North America and presents opportunities for travel companies to offer attractive package deals and promotions. Anyone see this trend on this side of the pond?
How AirAsia MOVE has become one of Southeast Asia’s top online travel agencies: This article by Phocuswire calls out how AirAsia is doing things a bit differently from other airlines primarily due to its partnership with PKFare. Through PKFare’s multi-sourcing model, they can access fares from 140+ suppliers and unique channels like NDC fares, airline APIs, web fares, and exclusive inventories at special rates. Is it really true though that many other OTAs are unable to source such rates?
Sabre Hospitality unveils SynXis Insights: A game-changing data and analytics tool for hoteliers: Sabre Hospitality launches SynXis Insights, an advanced analytics tool offering hoteliers actionable data to optimize decisions and enhance performance. Could this be the solution that hotels using SynXis have been seeking over years?
Marriott Targets ‘Mid-Single-Digit’ 2025 Corp. Rate Hikes: BTN reports that Marriott International is targeting 2025 corporate negotiated rate increases of “mid-single-digit” percentages year over year.
Loyalty Program Membership, Contribution, Liability, and Costs Continue to Grow: This analysis by CBRE published in Hotel News Resource found that while growth in several key metrics slowed in 2023, loyalty members’ overall contribution to occupancy increased, though marginal contribution per member contracted. (analysis based on publicly available data from five large hotel companies)
One of the main takeaways is that Loyalty programme fees increased by 17% from 2022 to 2023, which was significantly higher than other franchise-related fees (royalty, marketing, and reservation fees which all grew less than 10%). This indicates a growing cost burden for franchisees. While total operating revenue increased by 8.8%, loyalty programme fees grew by 17% – meaning these fees are consuming a larger portion of revenue.
This article suggests these costs are becoming more significant, and notably, the full extent of loyalty-related costs (complimentary food and beverage, upgraded rooms, enhanced housekeeping services, compensation points for service failures, executive lounge access) may not be fully transparent yet – until the industry adopts new accounting standards to better track these additional costs by 2026.
