Today's Hotelier - February 2018 - 22

PERSPECTIVES
KEY MONEY INCENTIVES

MMAXER/SHUTTERSTOCK.COM

KEY MONEY
INCENTIVES:
TO TAKE
OR PASS?

As developers contend for the most desirable urban real
estate for their new brands, should they consider this tool?
by RAHUL PATEL

T

HREE HUGE TRENDS
surging through the
hospitality industry -
millennials, technology
and the rise of Airbnb -
have spawned a plethora of responses to consumer demands.
Out with the old and in with the new.
Glo, Vib, Tru, Moxy, Cambria, Radisson
Blu, Ascend, Even and Centric are just a
few examples of the litany of new brands
that are storming into the market. They
are all striving to cash in on a rapidly
shifting hospitality landscape where
young, hip, urban-centered travelers
are driving demand.
What is the demand? Technology
and modern lifestyles are diverging
from traditional brands offering wi-fi
and continental breakfast. Consumers

want their hotel to blend with their lifestyle. These new brands, with yoga mats,
rooms without closets, doors opened by
smartphones and so many other new
features are almost unrecognizable to
older travelers, who largely remain loyal
to established legacy brands.
"This revolution in guest-room design
is not due to costs but competition.
According to industry statistics, the
hotel industry has been experiencing
steady growth for 84 months as new
entrants in this sector are introducing innovative brands and designs that
are the combined result of changing
consumer trends, hospitality research
and the 'Airbnb effect,'" CNBC said in
June 2017, citing Guy Langford, leader of
Deloitte's Travel, Hospitality and Leisure
advisory group.

2 2  | FEBRUARY 2018 | TODAYSHOTELIER.COM

And that's the rub for the well-known,
rock-solid brands that have dominated
the industry for so long. The Airbnb
phenomenon, the explosion of internet
connectivity and the millennial generation have rocked the playing field. The
established brands must satisfy their
older customers' demands while scrambling to offer completely new kinds of
experiences to keep up with younger
consumers. And they know they must
do so quickly or risk losing market share.
That pressure to establish a foothold
with millennial travelers before the
opportunity is lost is bringing about the
resurgence of an old industry tool - the
key money incentive.
Traditional power brands such as
InterContinental, Radisson, Wyndham,
Choice and Best Western are all grappling


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Table of Contents for the Digital Edition of Today's Hotelier - February 2018

Letter From the Chairman
Letter From the President & CEO
Government Affairs
CEO View
The Great Extended-Stay Boom
12 Easy Pieces for a Hotel Renovation
Key Money Incentives: To Take or Pass?
How ADA Compliance Laws Affect Your Hotel Website
When Small Businesses Prosper, America Prospers
Hotel Financing Q&A
AAHOA @ Industry Events
Aahoa Founding Members
Aahoa Vendor Partners
Classifieds
Advertiser Index
Today's Hotelier - February 2018 - Intro
Today's Hotelier - February 2018 - cover1
Today's Hotelier - February 2018 - cover2
Today's Hotelier - February 2018 - 3
Today's Hotelier - February 2018 - 4
Today's Hotelier - February 2018 - 5
Today's Hotelier - February 2018 - 6
Today's Hotelier - February 2018 - 7
Today's Hotelier - February 2018 - Letter From the Chairman
Today's Hotelier - February 2018 - 9
Today's Hotelier - February 2018 - Letter From the President & CEO
Today's Hotelier - February 2018 - 11
Today's Hotelier - February 2018 - Government Affairs
Today's Hotelier - February 2018 - CEO View
Today's Hotelier - February 2018 - The Great Extended-Stay Boom
Today's Hotelier - February 2018 - 15
Today's Hotelier - February 2018 - 16
Today's Hotelier - February 2018 - 17
Today's Hotelier - February 2018 - 12 Easy Pieces for a Hotel Renovation
Today's Hotelier - February 2018 - 19
Today's Hotelier - February 2018 - 20
Today's Hotelier - February 2018 - 21
Today's Hotelier - February 2018 - Key Money Incentives: To Take or Pass?
Today's Hotelier - February 2018 - 23
Today's Hotelier - February 2018 - How ADA Compliance Laws Affect Your Hotel Website
Today's Hotelier - February 2018 - 25
Today's Hotelier - February 2018 - When Small Businesses Prosper, America Prospers
Today's Hotelier - February 2018 - Hotel Financing Q&A
Today's Hotelier - February 2018 - AAHOA @ Industry Events
Today's Hotelier - February 2018 - 29
Today's Hotelier - February 2018 - Aahoa Founding Members
Today's Hotelier - February 2018 - 31
Today's Hotelier - February 2018 - Aahoa Vendor Partners
Today's Hotelier - February 2018 - 33
Today's Hotelier - February 2018 - 34
Today's Hotelier - February 2018 - 35
Today's Hotelier - February 2018 - 36
Today's Hotelier - February 2018 - 37
Today's Hotelier - February 2018 - 38
Today's Hotelier - February 2018 - 39
Today's Hotelier - February 2018 - Classifieds
Today's Hotelier - February 2018 - 41
Today's Hotelier - February 2018 - 42
Today's Hotelier - February 2018 - 43
Today's Hotelier - February 2018 - 44
Today's Hotelier - February 2018 - 45
Today's Hotelier - February 2018 - Advertiser Index
Today's Hotelier - February 2018 - cover3
Today's Hotelier - February 2018 - cover4
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