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HOW COST OF CUSTOMER CAPTURE CAN POWER HOTEL PROFITABILITY .
Contributed by KATIE KRIEGER & SUSIE PARK , JLL HOTELS AND HOSPITALITY GROUP EVPS
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Inflationary pressures , including headwinds in labor and operating supply costs , have had a direct impact on overall profitability within the hotel industry . Though it is true that average daily rate ( ADR ) for hotels has generally recovered following the COVID shutdowns , the return to pre-pandemic profit ( both in dollars and margin ) remains out of reach for many hoteliers . All stakeholders continue to be focused on maintaining
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and growing profit margins — distribution channel mix and associated cost of capture are critical pieces of the puzzle in preservation of it .
Hotels are not only contending with traditional direct booking disrupters , such as online travel agencies ( Expedia . com , Booking . com , for example ), but also newer entrants , including credit card companies that offer incremental incentives to book through their platforms and enables them to control the
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entire shopping and buying experience . Though hotel brands partnering with credit cards isn ’ t a new phenomenon , the expansion of credit card company partnerships and targeted one-stop shopping experiences ( flights , hotels , rental cars , experiences , etc .) continues to change the competitive landscape .
According to JLL research , sourced by STR , the number of global brands has grown 23 % since 2019 , from 1,100 to 1,350 . If you consider how
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60 hotelsmag . com May / June 2024 |