Skift Travel News Blog

A lot of hotel guests are dissatisfied with customer service and costs, according to study released on Wednesday by JD Power, a market research firm.

A survey of 34,407 hotel guests for stays between May 2021 and May 2022 found a higher level of complaints than the previous comparable period.

Many consumers appear to be irritated about costs and fees, room cleanliness, and staffing. The results come against a backdrop of a hotel sector struggling to handle the post-pandemic surge in demand during a labor crisis.

Key takeaways involve the interplay of cost and quality in consumers’ minds:

• “The single biggest factor driving this year’s 8-point decline in overall satisfaction is hotel cost and fees.”
• Guest satisfaction with budget and “upper-midscale” properties fell 11 points, the largest decline in years.
• “Another factor driving the decline is satisfaction with guest rooms, which suggests that hotel guests are feeling like they are paying more, but not getting more in return.”
• “While hotels still get relatively high satisfaction scores for guest room cleanliness, scores for décor and furnishings, in-room amenities and quality of bathrooms decline from a year ago.”

Much of the attention regarding the euro’s historic fall has focused on Americans getting cheaper vacations in Europe — and the converse for EU residents — but the euro’s reaching parity with the U.S. dollar obviously has business consequences too — and Booking Holdings will likely have to deal with a material adverse impact.

In a research note Wednesday, Jake Fuller of BTIG wrote that he expects an “11 point headwind” to Booking’s growth in bookings in second quarter results and through the rest of 2022 because of volatility in the euro and British pound.

BTIG estimated that Booking Holdings generates about 55 percent of its bookings in Europe. The company doesn’t break out the percentage. “Within Europe, we assume an 85-15 split between the euro and British pound,” the note said.

Booking Holdings’ exposure to the euro “is likely material, should impact the 3Q guide, and does not appear to be reflected in consensus numbers for the year,” the research note added.

Geography has played a major role in how various online travel agencies fared during the pandemic.

Expedia Group benefited throughout much of the pandemic when the U.S. domestic travel market boomed, particularly for stays in vacation rentals.

On the other hand, Booking Holdings suffered because Europe was slower to rid itself of lockdowns than the U.S., and now Booking has to cope with the euro falling to a low it hasn’t seen in two decades.

From a variety of reports, Booking Holdings appeared to be gaining market share in June, but the euro crisis could blunt some of the progress.

Accor’s board said on Tuesday the company wants to simplify its organizational structure to create two business units. The move, which raises questions about possible divestitures, has been sent to employee representative bodies for their approval.

The two business units would be an “economy, midscale, and premium” division for 4,816 hotels representing brands such as ibis, Novotel, Mercure, Swissôtel, Mövenpick, and Pullman. It will have four regional headquarters based in Paris, Sao Paulo, Singapore, and Shanghai.

Another division would be for “luxury and lifestyle.” It would get four brand collections that together have 488 hotels: Raffles & Orient Express, Fairmont, Sofitel & MGallery, and Ennismore.

“By evolving from a generalist to a multi-specialist model, our aim is to further improve Accor’s appeal in the eyes of talents, owners, partners, and investors,” Sébastien Bazin, the group’s chairman and CEO, said in a statement that didn’t mention any cost savings.

Cue the inevitable questions about whether this planned restructuring makes it easier for Accor to spin off a part of its company to an acquiring investor.

“We would also expect this makes a break-up more likely longer-term, where different owners may be different in the varying merits of the two divisions,” wrote the research analysts at Bernstein in a flash note to clients.

Analysts at Bernstein also note: “It makes sense that the two divisions will have different long-term models (franchise vs managed), different target owners (“mom & pop” vs sovereign wealth funds), and different customers (international vs domestic).”

Pity the executives at Swissôtel, though. They must be asking themselves, “Why aren’t we luxurious enough?”

In a move that was no surprise, the board also endorsed the renewal of the contract of Bazin as the group’s chairman and CEO.

Aimbridge Hospitality, the largest U.S. company dedicated to running hotels on its own and on behalf of owners, said on Wednesday it had signed an exclusive contract with Amadeus, the Madrid-based travel tech giant, to provide business intelligence tools across its organization.

“The market conditions we face as a business today continue to evolve at a more rapid pace than we’ve previously experienced,” said Andrew Rubinacci, EVP Commercial & Revenue Strategy, Aimbridge Hospitality, in a statement. “Having access to our portfolio performance enables us to make more effective revenue decisions down to the individual property level and aid in strategic decision making.”

Aimbridge has more than 1,500 hotels across the U.S. and in 23 countries and will use Amadeus’s software to monitor performance, enhance forecasts, and track market shifts. It will use Amadeus’s tools, which include Demand360, Agency360, and RevenueStrategy360. Some of these tools were first acquired by Amadeus through its acquisition of TravelClick several years ago. Amadeus has since refined and integrated the software.