Insiders Say Hotels Must Stop The Covid Cuts Now – It’s Immoral (And Bad For Business)

Some hotels have been practicing shrinkflation, giving you less for the same or more money.

Jeff Bezos says the biggest mistake businesses make is not focusing most on what customers want. However Marriott’s CEO – who says workers make too much money and guests need to have more sympathy for hotel ownership groupssays his chain needs to balance “the expectations of our guests..and the financial realities that our owners and franchisees face” which means “hotels might have a different way of doing business going forward” with brand standards modified to “consider franchisee feedback and..focus on reducing costs” with moves like “elimination of daily housekeeping at certain properties.”

Two hoteliers and hospitality consultants are pushing back, making the case that the hotel industry is living a big lie (paywall). They’re charging pre-pandemic rates, still marketing themselves as full service products, but keeping Covid Cuts in place. And that needs to change. Their basic argument,

  • Hotels that asked guests to sacrifice service due to the pandemic should return that loyalty after the pandemic, delivering the product that guests sacrificed for.

  • Hotels that used to be luxury, but no longer offer luxury services, should no longer claim to be luxury. Offer the product and business model you want, but be honest about it.

  • Quit claiming your cutbacks are due to Covid safety when everyone knows that’s a lie.

[U]sing the pandemic as an excuse to justify long-term changes to the public. There is no question about the effect this pandemic has had on all industries. For two years now, guests have graciously accepted limited services because they knew what we were fighting against. Now, as we slowly return to normality, don’t we owe them the same promise and product that made them loyal to us?

Our two other concerns are asking the customer to change their expectations to accommodate our business needs, rather than re-positioning our product and maintaining pre-pre pandemic room rates while offering far less in exchange, thus not rolling the savings from costs associated with reduced operations to the guest.

If we choose to limit our services because we find it is a better model for the business, we must re-align our positioning to fit our new offering. If a luxury hotel that charged $300 a night for a room with daily housekeeping services and in-room amenities pivots to limited housekeeping with no mini-bar or in-room dining, should it not downgrade it’s positioning to a mid-level or limited-service hotel?

U.S. hotel average daily room rates are up nearly 12% against 2019. Scott Mayerowitz declares this will be “Sold Out Summer.” So maybe hotels can get away with this for awhile.

However hotels need to differentiate themselves from each other and from home rentals. They do this by offering service, convenience and luxury. Otherwise they cede the market to their biggest rival. I had a younger traveler not used to luxury stays comment to me on a recent experience at the Park Hyatt in Paris. She said she felt important staying there interacting with staff especially the concierges. Hotels need their next generation of customers, and not to turn off the ones they have.

The authors conclude, “we fundamentally disagree with the premise held by some industry insiders that guests must accept a lesser product as the new normal without a shift in cost.”

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. Are large hotels still blocking off substantial numbers of rooms from inventory due to staffing shortages (thus inflating the rate of remaining rooms)?

  2. The Park Hyatt (or St Regis or Waldorf or whatever) will get back to pre pandemic service levels soon enough. The biggest permanent cutbacks in service will be at the generic Marriott, Sheraton, Hilton, Hyatt Regency, etc. Why? Because even pre-pandemic, those properties were not earning higher rates than the comparable Courtyard, Hilton Garden Inn, Hyatt Place, etc. So in a way the customer helped to choose a lower touch service model. That said the hotels chains created this issue by undercutting themselves.

  3. 100+ nights a year for 20 years guy here. Here’s the thing, I’ve now become used to no housekeeping. I never even think about it and I’m surprised when it happens and I’m generally always in 4-star properties. They’re programming the new normal and I’m sad to say it’s working.

  4. Outside the US I’ve had great experiences, even in Asia, where service is 99% of pre-covid and prices are still lower than 2019 or at least competitive.

    This has been a US phenomenon in my experience. But the solution is simple. 3 star hotels are still pretty much what they were. Hyatt Place. Courtyard. Hampton Inn. All the same as pre-pandemic and perfectly comfortable.

    So until the full service hotels in the US offer full service, why bother?? They’ll get the hint eventually.

  5. In addition hotels are adding shameful fees for services that were included before. Recently in Colorado a Hampton Inn and a Residence inn charged extra for parking in lots that are not gated. Does corporate care that their franchisees are changing what their brand represents? Would McDonalds care if a customer was charged extra for special sauce?

  6. COVID is now every business’s new excuse to offer crappier services and crappier products for far higher prices to line the folks at the top’s pockets even though they have more money than generations of their children could ever spend. Why are you so outraged that hotels are doing the same? It’s just business as usual in the same greed driven society and economy we have lived in since the world’s wealthiest bankers set it all up back at the turn of the century. Why does any of this surprise you now? After all, most of you are the ones screwing everyone else over trying to pretend you are living the high life with the occasional upgrade that those of us who pay our way in life bare the cost for. Look up the term “hypocrite” and see if you see some familiar concepts.

  7. Wait until midterm election season rolls around. COVID rules that benefit one party over another are going to come back in full force.

  8. Stayed this week at Golden Nugget in Vegas. Rates were $250-400 for the rooms we all booked, plus a resort fee on top. They had a policy that if you wanted housekeeping you had to request it by noon the day before. So if you check in for two nights on Friday at 3pm you have already missed the cutoff for Saturday service. I am not stupid, I realize this saves them a ton of money I am sure, but it is also exceptionally unfriendly to your customers who you also keep telling me you are trying to please and want to let know if you let me down. Guess what, you did.

  9. @Brian: I am in the same catagory as you regarding stays/revenue. I, too, agree I am becoming accepting of most of the cutbacks. But to be honest, they don’t bother me because I didn’t need or appreciate many of them when available. Housekeeping: I am very comfortable with every other day. The one change I don’t like are the F&B credits rather than free breakfast. My normal travel day was fuel up, grab a coffee at lunch, then a healthy dinner preferably at a local restaurant.

  10. In one Doubletree in Dallas they left me a pile of linens over my 5 day stay and told me to make my bed.In addition they gave me large plastic bags to throw away trash and used towels into the hallways which always is an attractive sight till they pick it up.
    The toilet seat was falling off and slid if you sat on it.Other than that good stay and cookie and the restaurant was open and actually pretty good for a 15 dollar buffet and they made omelettes to order.
    The upside? they didn’t ask me to mop floors in the public area or scrub toilets lol
    It’s not as pleasant or as much fun as it was in past years and there are a number of hotels I stopped staying in that serve no breakfast ,absurdly limited offerings cereal and toast ,the restaurant is closed or sh*t on a shingle is instead the new fine dining standard.

  11. The biggest problem is how much of a sheep the American traveler, the American media, and American policymakers are in terms of corporate welfare and allowing cutbacks and devaluations to stick. We were sheep with baggage fees, sheep with basic economy, sheep with destination fees or resort fees, and now sheep with these general cutbacks where you pay about the same and get less. Even among the circles Gary works in, they coddle these executives in things like the Freddy awards, and really don’t hold their feet to the fire on how they screw their customers and enrich there shareholders. The media and the competition should have a field day with this Marriott guy trying to brainwash devaluations. There should be more articles that the travel industry is pumping out garbage and people should not take it.

  12. The hotel lack of service issue is ridiculous. But, as usual, what can the consumer do about it? Hotels don’t care if we’re happy or not, they know we have to sleep somewhere. I remember a Hilton in San Francisco at the beginning of the virus nightmare. They shut off the ice machines. A recent stay at a Hampton Inn in Florida proved the housekeeping point … the floor of our room was filthy. I don’t need clean sheets and towels every day, but I do expect to be able to get a bucket of ice and be able to walk around my room without shoes on. Ludicrous. Seems like management has just set up a checklist of services they can abandon without any regard for the guests. Front desk staff must be attending classes on how to ‘shrug and say oh well’ when asked about problems. We are seeing the nasty side of capitalism when it comes to the travel world.

  13. “Insiders Say Hotels Must Stop The Covid Cuts Now – It’s Immoral (And Bad For Business)” Like huge hotel chains care about morality … their rooms are full of annoyed guests. Nobody will do anything about it, they’re too busy calculating the month’s revenue. And why should they care about their guests, the money coming in is about the same as it always was, and expenses are WAY down. It’s the American way!!

  14. All industries adjusted during COVID and are now applying changes to be more efficient and profitable. Accept the fact that NO INDUSTRY (including hotels) will go back to the pre COVID service levels. Also they do need to balance guest experience w profitability. Sure some hotels will reintroduce previous services but many never will and to expect otherwise is insane. For example most mid-upper market Marriotts, Sheratons, Hiltons and certain Hyatt brands realized they lost money on the lounges and it didn’t really differentiate them so they likely will never come back in many markets. I go to Las Vegas a lot and the service changes there are dramatic along with much higher prices and reduced elite gaming program benefits. But you know what – Las Vegas just recorded their 12th straight month with a billion dollar gaming profit and people pack the place.

    As long as hotels get the price point they want there is no incentive for them to add services regardless of the whining of bloggers. BTW the consultants are self serving – they hope to seek services to these hotels around revising their offering so the info in this article isn’t worth much.

    You have 2 options – either pay for what you get or go somewhere else. Many on here may elect to go somewhere else but you are well under 1% of their guests and won’t move the needle so shut up please with all the reminiscing about the good old days!

  15. Hotels are writing their own obituary right now – they’ll save some money now, but if I want no housekeeping, I can get that + a bigger, private space with Airbnb.

  16. I haven’t read the article but the snippets provided in the article use terms that make it sound like there is some sort of moral obligation on the part of hotels here not to use marketing ploys and to extend loyalty. Stuff like “don’t we owe them the same promise . . . .”

    This strikes me as incredibly naive. These are commercial transactions. Hotels will do what they need to do when they need to do it in order to stay competitive, but no more.

    Right now we’re in a part of the cycle where hotels are testing the premise whether decreases in cuts and increases in price will have the long-term impact that they previously assumed was in inherent in loyalty programming. They will be right or they will be wrong. Things will change or they won’t. If they can’t sell rooms, they will adapt. If they can, we will.

  17. @Dwondermeant:
    The DoubleTree by Hilton in Dallas didn’t ask you to mop the floors in the public area or scrub the toilets because you didn’t bring your mop and toilet brush when you checked in.

  18. I agree with Ryan. In the U.S., hotel companies will pitch these cutbacks as enhancements and expect the public to swallow it. Many Americans will believe anything if you say it loudly and long enough.

  19. Hotels wanna cut services and make higher profit? Ok

    But you’re not no longer a Marriott or a Hilton, you’re a bargain basement Super 8.

  20. If you expect something better than 2020 service at 2019 prices and don’t get it, put a review on yelp or tripadvisor that calls the hotel out. That is: If you care (I do, but I see that some others don’t), then help the marketplace sort this out

  21. I agree with Ryan and john. What you are speaking of seems to be a US phenomenon. We just returned from 5 days at the Bangkok Millenium Hilton where service was great. Daily housekeeping, full breakfast in the restaurant for Gold and Diamond Elites. Executive Lounge with a wonderful afternoon tea with wonderful drinks and snacks. And oh, we got upgraded to a full suite as Diamond Elites. More of the same can be said for our stays at the Munich Hilton, Paris Airport Hilton, Frankfurt Airport Hilton, Athens Hilton, Dusseldorf Hilton, and Cologne Hilton. It seems to be the hotel ownership groups in the US who are screwing the public. The hoteliers in Europe and Asia don’t seem to be doing this.

  22. This reminds me of a JUdge Judyism or was it the name of her book? Don’t piss on my leg and tell me it’s raining. Personally I have not had reason to travel in the past couple years due to personal situations not covid related….but when I do choose to travel, my pup comes with me and make it known we do NOT need housekeeping and we’re fine with that. It’s wasteful to change out linens daily and I can clean up after myself. It would be nice though if the hotels would at least put a large bin for trash and one for recyclables on each floor. And let us know where or how fresh linens could be had if we needed that….

  23. @Jim +1 As Gary has noted if hotels want to eliminate housekeeping and other perks that is fine but I will simply go to AirBnB where I get the same level of service but more space. We have already seen this story played out in the airline industry where no service airlines like Spirit and Frontier are making a killing.

    Not a bright move by hotel managers or owners but apparently they do not see the value in providing even minimal perks or value. Big mistake. People have long memories. I know people who stay at the same property every year (or every business trip) regardless of rates because they are treated well.

    The hotels that continue treating customers like crap won’t be on our list for future stays.

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