Corona Daily 062: Your Next Stay at a *****Star Hotel

With coronavirus retreating and the sun shining, American families are rushing out holidaying. At the beginning of April, over ten million travelers passed through airport security at American airports. People are heading south in particular, to warm weather and lax covid protocols. Hotels in Tampa and Phoenix are almost at full occupancy.

Hotels, including the luxury hotels, are planning a new post-pandemic business model. Pandemic taught them certain things about guest expectations. The new strategy is to improve profits by employing fewer workers. Two big areas are daily room cleaning and breakfast spreads.

In most hotels, whether earmarked for quarantine or not, staff was instructed to minimize their interaction with the hotel guests. Coronavirus-era government health guidelines said, “Guest rooms occupied by the same customer over multiple days should not be cleaned daily, unless requested.” The American hotel association would love to retain them post-pandemic.

If room cleaning were to happen on alternate days instead of every day, the hotel can employ half the housekeeping staff, instantly boosting profit margins. USA conducted a national survey in August 2020 asking frequent travelers a few questions. 86% said they were happy with suspending daily housekeeping. 85% were happy using technology to reduce direct contact with hotel staff. 77% were happy with temporary closing of swimming pool, gym etc. Hotel owners have concluded, perhaps wrongly, that these services are not critical. If customers could live without them during the pandemic, why not later?

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Different options are considered. Frequency will be reduced. An extreme suggestion is to offer it only between check-out and check-in. If you stay for seven days, you will have a clean room on arrival. It will be cleaned only seven days later when you leave. (In USSR times, I have lived in Soviet hotels, where this was common practice. I never thought it would one day become best practice for American hotels).

Marriot hotels would like to move to “opt-in” as opposed to “opt-out” housekeeping services. The default is absence of housekeeping. If you want it, ask for it, and pay for it. The day is not far when you will need to tick the box for “room cleaning” and pay extra when booking a hotel room. (Like food on a domestic flight).

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Breakfast is the other thing that may become a casualty. In the pandemic, hotels sent packed boxes to the rooms, and guests were happy to eat in their rooms. (The word happy is used by the hotel owners). Why spread a table every morning with cornflakes, fruit, juices, cakes, egg dishes, meat slices, cheese and grapes? In a bed and breakfast model, the guests tend to eat more and damage the hotel’s profitability.

Breakfast is another item that may become an opt-in.  

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Marriott, the world’s largest hotel chain has installed “contactless arrival kiosks” at its hotels in New York, Louisiana and Miami. Convenience stores have been replaced by giant vending machines. These contact-free innovations are for the benefit of the guests and their health.

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In America, employment in the hotel industry is still down more than 25%, with more than 500,000 jobs lost in the pandemic. The labour union “Unite Here” estimates that the loss of the practice of daily room cleaning would lose 181,000 cleaning jobs, 39% of all cleaning jobs. They would never come back.

Hilton’s CEO Chris Nassetta said he is focused on reducing labour costs at the chain’s 6,400 hotels. “The work we are doing right now in every one of our brands is about making them higher margin businesses and creating more labour efficiencies. (genteelism for job cuts). When we get out of the crisis, those businesses will be higher margin and require less labour than they did pre-covid.”

The Hilton share price rose by 20% after his speech. CEO Nassetta’s pay package went up from $21 million (2019) to $56 million (2020).

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If you ask me, book an Airbnb the next time you want to book a hotel. You have to clean the place yourself, but that is no longer a shortcoming, is it?

Ravi