The Andaz Singapore is taking a page from airline Basic Economy fares, offering a new ‘room only’ rate as first noted by Singaporean blogger Milelion. When you think of room only, you may assume that it simply excludes breakfast or other inclusions. In this case they mean it literally: you can stay in the room, but have no access to the hotel’s gym or pool.
The rate is available on third party site Klook.
Room Only Package: Kindly note that this package is only entitled to a 1-Night Stay in a King Bed / Twin Bed Room with in-room minibar, once per stay and all day refreshments at Sunroom on Level 25. This package does not include Breakfast, Swimming Pool Access and Gym Access.
I don’t think I’ve ever seen anything like this before from a full service hotel, though invite reader experiences. The gym here is accessed by key card and pool use currently needs to be reserved so access control may not be a challenge for the property.
This is a way to offer lower rates on third party websites than through Hyatt’s channels best rate guarantee doesn’t apply since you aren’t booking the same room under the same terms, these restrictive terms aren’t available through Hyatt.
There’s further explanation of the ‘room only rate’ as “due to the swimming pool and gym access being fully booked” but the hotel is selling other rates without this exclusion. Currently due to social distancing requirements the hotel takes advance reservations at the pool within 72 hours – and, as Milelion notes, their online booking system shows plenty of availability within that window.
These rates may be useful to a hotel along a certain margin, but it would be a very bad idea to make them commonplace.
- The economics don’t actually make sense. Once the hotel invests in a gym and a pool or similar facilities, the marginal cost of allowing access to additional guests is very very low. There are fixed costs to offer these amneities, but it doesn’t cost much to make them available to an additional room. So the profit-maximizing strategy, once they’re available, is to bundle them rather than unbundle them (like your cable bill).
- They erode a hotel’s competitive advantage over Airbnb. Hotels need to double down on what makes them unique and play to their strengths, otherwise just book an unserviced apartment. By the way for the same reason hotels need to bring back daily housekeeping quickly, rather than delaying this for cost saving reasons which will be tempting.
It’s unwise for a hotel whose product differentiation is based on service to follow the airline model mocked 33 years ago by Alaska Airlines, back when airlines seemed full service in comparison to today.
We’ll be watching the future of this rate with interest.