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Luxury Travel Segment: How to Reach Affluent Americans

In a time where “Affluenza” is a legitimate defense in court, many luxury travel brands are focusing on wealthy consumers to maximize profits. However, “luxury” doesn’t mean the same things that it did only ten years ago. Big brand names and indulgent spending on status items are no longer examples of luxury goods; instead, high quality and unique products or experiences now define luxury. A study conducted by Ipsos Connect and sponsored by Martini Media found that affluent Americans are more likely to spend their money on vacations than on material possessions.

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Average Hotel Room Size is Shrinking

According to a November 2015 article published on Road Warrior Voices, the average size of hotel rooms today is about 330 square feet, but new hotel brands are constructing rooms only a little over half that size. This has decreased since the 1990s where the average hotel room size was over 350 square feet. Marriot’s Moxy Hotels are now building rooms about 183 square feet in size and the new brand Yotel’s rooms are only 170 square feet on average.

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Hoteliers Need to Improve Brand Intimacy With Guests

In their 2015 Report on Brand Intimacy, MBLM found the travel industry to be lacking in intimate brand relationships with their guests. The report studied nine different industries: travel, automotive, retail, health & beauty, tech & telecom, entertainment, financial services, consumer packaged goods, and apparel. Of these industries, the travel industry was ranked last in brand relationships.

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Major Effect of Airbnb on the Hotel Industry

AirBnb has quickly become a threat to hotels as travelers choose to book with independent hosts on the website rather than with traditional hotels. While every hotelier is aware of the threat and stiff competition that is Airbnb, do you know the quantifiable impact the vacation rental site actually has on the industry as a whole? Recently, the Hotel Association commissioned a report by HVS Consulting & Valuation on the financial effect of Airbnb on the hotel industry. The report focused on the effects of Airbnb in New York City, so results may vary in different areas.

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How to Stay Up to Date with SEO Best Practices for Hotels

There is no question that search engine optimization (SEO) is critical when trying to rank highly on Search Engine Results Pages (SERPs). Higher rankings on Google, Yahoo! or Bing result in more organic traffic flowing to your site, which is an important source of traffic. According to Hotel News Now, at least 30-35% of hotel website revenue is generated from organic SEO listings. While SEO best practices are well documented, they change frequently; Google, the largest and most used search engine, changes their algorithm determining which listings appear at the top of SERPs at least 500 times a year.

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Rich Media on SERPs Results in More SEO Traffic

When optimizing your webpage to appear in the first few results on a SERP (search engine results page), the ultimate goal is to increase traffic to your site. After all, it’s not very useful if you’re the top result, but no one clicks on your listing. There are many ways to increase your ranking such as creating pay-per-click campaigns and using best SEO practices. A study of 300 people conducted by Blue Nile found that the presence of rich media on SERPs increased the number of clicks the listing received.

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Guests Frustrated by Hidden Resort Fees

Have you ever gotten all the way to the end of the booking process only to be slapped with additional fees you weren’t planning on? There might be a mandatory resort fee that helps the hotel pay for certain activities and amenities such as pool and fitness center access. These fees were not initially stated when you did your research, and therefore, the actual price of the room is higher than expected. The extra fees likely frustrated you and potentially forced you to abandon the booking.

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Luxury Hotels See Growth in 2015

Last October, Bain & Company issued the Altagamma 2015 Worldwide Markets Monitor Report stating that the luxury sector reached $1 trillion in retail sales in 2015. This is a total overall growth rate of 5% from 2014. Of the luxury sector, the hotel industry saw one of the highest growth rates (7%) from 2014-2015. In addition, fine dining establishments, which are often found in luxury hotels, are also experiencing growth.

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The Future of TripAdvisor Instant Booking

TripAdvisor’s Instant Booking feature works similarly to the Book on Google product. Much like the cost-per-click model employed by search engines, hotels bid to be in the top results so their logo and website are linked to the TripAdvisor profile. However, some hotels offer inventory via TripAdvisor through the Instant Booking feature. In the screen shot below, you can see that one of the top results for the Omni Los Angeles at California Plaza is a TripAdvisor result.

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Independent Hotels Rely on OTAs

Independent accommodation providers are smaller than the well-known hotel chains they compete with and therefore, rely more heavily on OTAs to capture bookings. These independent inns, bed and breakfasts, hotels, resorts, and motels only comprise 30% of the lodging market, yet generated over $68 billion in room revenues last year, according to a study done by Phocuswright.

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