NEW YORK— With new survey statistics showing Americans more comfortable traveling today than just one month ago, lodging industry executives are scrambling to find ways to get heads in beds. While price slashing may seem like a good way to go about motivating consumers to travel, industry executives warn that this route may backfire. Many said that by doing so, not only will consumers expect lower pricing moving forward, but the practice of price slashing— to the point where prices are below the cost of delivery— could send some hotels into the poor house in a matter of week and/or months. Marilyn Carlson Nelson, CEO of Carlson Cos., called the practice of price slashing a “death wish” at a recent meeting of travel executives, noting that while it will be giving those who are traveling a “deal,” it is not likely to bring new business among those who do not wish to take to the road. Statistics from a new survey conducted by Yesawich, Pepperdine & Brown revealed last week that the slowed economy was as much of a concern regarding travel spending among Americans as fear of terror attacks. This said, a certain responsibility has been placed on the travel industry to provide value-added packages to consumers, thus benefiting both travelers and hotels (who aim to reap some profit, however small). John Russell, chairman of the AH&LA said recently he believes that providing meaningful consumer incentives will help the industry get back on track. So take a look at the types of promotions in the marketplace today, and ask yourself if you can do better by banding together with other components of the travel industry— whether it’s a car rental agency, or a golf operator. If a deal is to truly be “value added,” it must speak to the consumer. Don’t depend on hotel leaders lobbying on Capitol Hill for legislative policies that could “save” the travel industry. While hotel executives and other travel leaders are working hard to get relief in the form of legislative action, new laws alone will not make the difference— and it won’t stimulate Americans to travel. We have the power to do that and should start exercising that power. In fact, according to a recent YP&B survey, most Americans are receptive to travel incentives. YP&B data suggests that almost 60% of those who said they would cancel or take fewer trips because of the terrorist events also stated that attractive promotional offers from the airlines would influence their decision to travel once again. Similarly, in an online study conducted by Travelocity.com, which included responses from more than 2,000 Travelocity.com members who are leisure and/or business travelers, about 43% of respondents said they plan to travel this Thanksgiving compared to nearly 43% who said they traveled last year— an encouraging statistic. Some experts believe there may even be somewhat of a silver lining in the clouds. More people than usual are expected to travel this Thanksgiving because the holiday has a special significance, as Americans look to spend time with family and friends in this time of crisis. So don’t slash prices to fill your hotel rooms, when things are just starting to look up for the lodging industry. Reports of near normal occupancy levels at hotels in varying locations are becoming more common with each passing day. Remember, we are a stronger, more agile industry than 10 years ago. Those of us who have been around for more than a decade have learned valuable lessons from past down cycles. We have made changes and adapted to a slowing economy in past months and, if we think and act smart, we can do the same for the current, albeit, more extreme, situation.
