Luxury Incentive Travel Making a Comeback
Emirates Palace, Abu Dhabi
Corporate Travel Trends: Luxury is Finally Affordable
by Anne Thornley-Brown, President
Executive Oasis International
For this blog entry, I’ve decided to take a totally different approach and share some good news headlines. The AIG effect is fading. The luxury corporate travel market finally seems to be recovering.
Part of the reason for this is that luxury hotels are now providing very attractive packaging and pricing for corporate meetings or adding value at existing price points. Consider these recent stories:
Trend #3Extreme Price Sensitivity, with Hotels once again competing for Meetings Business with Aggressive Package Pricing.
The recession and the AIG effect caused many traditional hotels to turn to midsized corporate meetings to fill their rooms. Although not an uncommon strategy for hotels in a recession, the severe business climate of 2009 helped re-educate traditional hotels on the merits of aggressive meeting package pricing with its high perceived value.
Companies are finding that they can stay at luxury 5 star properties in the USA, Canada, the Caribbean, Asia, and the Middle East for the same price as a 4 or 5 star hotel.
While dealt the hardest blow during the economic meltdown, luxury hotels are not down for the count. For an increasing number of buyers, the unprecedented value now offered by top properties is just too good to ignore.
There are signs that luxury hotels have been able to cut into the business that might otherwise have gone to a hotels in a lower-tier category. Greg Champion, chief operating officer for Benchmark Hospitality, which operates hotels primarily in the four-star category, is among those feeling the heat from the top tier.
“It’s now more competitive between properties than it’s ever been,” he says. “We’re now competing head-to-head with five-star properties. Everyone talks about the AIG Effect, but there are a lot of planners out there who say, ‘If I can stay at a five-star for the same price as a three- or four-star, why wouldn’t I do that?’”
If luxury hotels are seeing a rise in meetings business, it’s safe to say that a big motivator is the smorgasbord of value-adds on the table, everything from rate discounts to packages offering reduced attrition, free breakfasts, spa discounts, suite upgrades and more.
This CNBC Interview with the CEO of Ritz-Carlton echoes similar themes:
3. Upmarket all-inclusives
Money is still a major issue for people — even at the luxury end — so we’re looking for value more than ever: upscale packages are desirable as there aren’t any hidden costs or room service extras above and beyond what you’ve already shelled out.
4. Eco luxe
Hotels are starting to become more and self-sufficient wherever they can and travelers are considering the environmental credentials of a hotel more — this is constantly on the increase so hotels going the extra mile to lower carbon emissions.
A recent survey of high-end retailers revealed that 81 percent of Virtuoso travel retailers’ future bookings were up compared to this time last year. Eighty percent say sales are up over the last three months, while 55 percent say revenues are higher than this time last year.
So what business is increasing? Over half stated that leisure and corporate travel bookings are expected to rebound in the next six months.
Trella del Mare, Ain Al Shockna, Egypt
Luxury hotel chains around the world from Toronto to Dubai are seeking to increase capacity in the luxury sector for what they feel will be a market on the upswing.
Canadian hoteliers are actually now projecting a shortfall in the luxury hotel sector:
It is only a matter of time that pricing will rise to pre-recession levels. Savvy companies are making their plans for the rest of 2010, 2011, and even 2012 to lock in these favourable rates and offerings.
Executive Oasis International specializes in:
- team building retreats, business simulations, and executive retreats to help companies succeed even in the midst of turbulence
- incentive travel to reward corporate teams and express appreciation to clients
- luxury corporate events to promote your products/services and reward your team
We work with a number of luxury properties that currently have favourable pricing and packages for meetings, incentives and retreats.
As long as there is some flexibility in your dates, at some properties, groups of 20 – 40 people can have exclusive use of the resort for the entire duration of their stay.
Please contact us for details.
- Canadian Hoteliers see Gap in Luxury
- The vision of Dubai from a tourism expert
- 2010 Corporate Travel Index: Int’l Per Diems Show Oil Cities Ascendance
- Top 10 travel trends in 2010
Seems that great minds think alike.
I just saw this: