Analysis
consciousness of Millennials with the opening in St Martin’s Lane in central London of the first of a new sub-brand called Hub by Premier Inn. Rooms will typically be half the size of a traditional Premier room – and priced lower as result – but will maximise space with savvy design. In addition, Hub will also offer a smartphone app enabling guests to pre-set in-room functions, including lighting and temperature ready for when they arrive.
In the US, Intercontinental Hotels
Group’s (IHG) take on the Gen Y market is its new ‘wellness’ mid- market brand called Even, with the first hotels opening this spring in the
The major chains are engaging in a race to develop new brands appealing specifically to this demographic
US. The hotel’s holistic-approach starts at check-in when guests will reportedly be directed to a ‘wellness island’ to complete the formalities, with staff offering them either a cool or heated hand towel, and a cup of water with a slice or lemon or lime.
CHANGING DEMOGRAPHIC Hoteliers, of course, have been aware of the changing market demographics for some time. The stylish urban brand, Aloft, was launched in 2008 by Starwood to meet the demands of the new generation, although it has focused growth in the US and Asia-Pacific rather than Europe so far. The second UK Aloft hotel (the first is at Excel in London) is due to open in Liverpool this autumn. IHG also repositioned its midmarket
Hotel Indigo brand in the late 2000s to attract the new young demographic, (new hotels are planned for Manchester and Cardiff to add to the eight already opened in the UK). And Hilton has found that a focus on good design and value-for-money has made its Doubletree by Hilton mid-market chain appealing to Millennials. Yet the impact of the new generation on hotels goes deeper than just new brands: the way hotels are perceived, planned and utilised is changing as well. Hotel lobbies, such as in the newer Doubletree hotels, are being remodelled to provide more casual places for those wanting to work, eat or simply network with colleagues or
contacts. Hoteliers now think lobbies should become the heart of the hotel and not simply a place to pass through – something that surveys suggest appeals to the younger generation, which wants to relax and/or work in a public space rather than be isolated in a room.
This trend, of course, is forcing the pace of free wifi in hotel public spaces as well as in rooms – something the Millennials see as a non-negotiable part of hotel life rather than a special privilege. More gadgets also influence room design (more conveniently located charging sockets are needed, for example) while mobile room
check-in via smartphones is already on the way. Marriott, for example, is linking mobile check-in to its frequent guest scheme later this year.
A GOOD INVESTMENT The Millennials’ fondness for their smartphones and tablets is not only being felt in the hotel industry but among airlines. At its most obvious, the pressure to relax restrictions on the use of phones and tablets on aircraft has been led by a generation who believe such curbs do not make sense.
The younger generation wants to relax in a public space rather than be isolated in a room
But there is also a clear impact ahead on airline distribution. A recent IATA report, The Future Of Airline Distribution, emphasises the “substantial business opportunity” the Millennial/Gen Y passengers represent, “as they have a lifetime of buying airline tickets ahead of them”. And by 2020, according to a Boston Consulting Group study, Millennials will become the largest single group buying business flights in the US with a 46 per cent share (up from 35 per cent in 2013), overtaking Gen X (currently 38 per cent) and Baby Boomers (25 per cent). Yet, perhaps surprisingly, one of the key aspects of flying that is a high priority for Millennials (according to the Expedia/Egencia survey) is airline loyalty programmes. Over half were influenced by these compared with around three out of every ten for those aged between 46 and 65. This again reinforces one of the underlying trends among this younger group: that value-for-money is very important.
NEGATIVE ASPECTS But is all the focus on Millennials justified? Some travel managers/buyers contacted for this article suggested that focusing on this younger group might indeed be excessively fashion- led. “They will eventually grow up and become real business travellers,” said one, somewhat sarcastically. Others admitted that there were perhaps potential adverse implications of Millennials’ behaviour, although
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