By Brian Jewell
Continuing recovery in the U.S. economy, coupled with a rebound in leisure travel spending, has spelled good news for the hotel industry this year. For many hotels, group tour bookings represent a significant portion of business. And although hotels report that group business is on the rise again, it is coming in different forms than what was typical a decade ago.
Recent statistics from Smith Travel Research indicate that the hotel business is enjoying a rebound. During May, the industry’s occupancy rate rose 4.5 percent over last year’s, to a total of 61.5 percent. The average daily rate rose 4 percent to $101.54, and revenue per available room rose 8.8 percent.
In the group tourism sector, business seems to be on the uptick as well. But some hoteliers report that today’s bookings look different than those of the past.
“Our group business is rising,” said Don Haggett of Lafayette Hotels, a company that operates 27 properties in Maine, New Hampshire and Michigan. “We’ve picked up a lot of new companies. Some of my old standbys have reduced numbers, but they’re making up for it by doing more tours. And some companies are way ahead — we’re seeing a big increase in business from overseas.”
Carlson Hotels Worldwide, an international company that includes brands such as Radisson and Country Inn and Suites, markets aggressively to tour groups. Lynn Myerson, Carlson’s director of leisure sales, sees group growth coming from various new directions.
“I think hotels now perceive leisure business as a more stable segment,” she said. “The overall demand is encouraging. There are new opportunities in emerging markets, such as Brazil and China. And I see an increase year over year for incentive groups and inquiries from high-end agencies and tour operators.”
A new demographic
Part of the picture for hotel chains today is a changing demographic as baby boomers begin bringing their travel habits onto tour buses.
“I think the trend now for the motorcoach tours is that you’re going to see families travel a little bit on the buses,” Haggett said. “It’s grandparents with their kids.”
The new demographics bring a demand for types of properties that haven’t always appealed to traditional tour groups.
“Baby boomers are becoming grandparents, and so there are more multigenerational vacations,” Myerson said. “They’re looking for destinations and hotels that meet the needs of grandparents and grandchildren. Radisson is opening many more resorts worldwide, so resort destinations are at the top of their minds.”
Resort activities also earn high marks in Hershey, Pa., where Hershey Entertainment and Resorts packages hotel properties with amusement parks and other attractions. Though room rates are prohibitively high for most tours during the busy summer travel season, groups take advantage of the Hershey properties throughout the spring and fall shoulder seasons, as well as during the holidays.
“We have some really attractive one- and two-night packages,” said Luke Kracke, group tourism manager for Hershey Entertainment and Resorts. “Packaging is a key. We don’t want to hide the overnight price, but group tours understand the concept of the package.”