Torres Consulting

Hotels: How going green can be monetized

From cards placed on top of the bed suggesting not to change the bed sheets daily, to the ones in the bathroom asking to reconsider washing all towels daily, hotels have, for a number of years, tried to get guests used to consider the impact of those services.

These are all initiatives left for the guest to decide. But there are other measures adopted by Hotel operators and owners: low flow showerheads, the removal of bathtubs from rooms, or a/c units that only work when there is someone in the room. All in the name of the environment….or to increase profitability (leave it up to you to pick the most relevant reason). And yes, there is a bit of “greenwashing” there too sometimes.

Another good example that comes to mind is what Starwood (now part of Marriott), has been offering for a number of years: the possibility of foregoing the room being serviced, thus saving resources for both the Hotel and the planet, in exchange of getting points on the loyalty card program, or credit at the F&B outlets of that particular property during your stay.

Other companies (IHG, Provenance), apply similar policies with rewards ranging from 250 points, to 10US$ in credit. Or go the extra mile, with rewards that include planting a tree, or donating that voucher’s value to a local charity.

The latest ones I’ve come across this week follow this trend, but with a twist:

-The first one, presented by SuitePad, is an app where the guest can opt-out of the room being serviced, and in exchange go for the usual credit voucher, but other options include discounts at the different hotel venues (SPA included). This way, it might end up working as a cross-selling strategy too. Same policy as above, but adapted to the 21st century.

-The other one comes from a trial by Oaky, where guests can opt-out of the service before arrival via their web. That way, the Hotel knows in advance, which helps them in terms of Hosekeeping manpower.

The next level in this field will be to upsell guests into a higher category room which will not be serviced, at a discounted price.

So, say an Ocean view room costs 50$ extra, and the Hotel has plenty available. The Front Desk could offer that room for 40$ in exchange of not having it serviced by Housekeeping.  Obviously, the key is how it’s phrased, emphasizing the added value of saved resources, etc… The hotel makes sure the room remains occupied, with the same (or more) profit that if it was sold at the full price with HK servicing it.

But there can be another twist to that one. What about charging more for rooms that are 100% eco-friendly? Recyclable amenities, local products, special linen, different set of towels, no bottled water,  utilizing only green-energy…would guests be willing to pay more for that?

That is what 1Hotels is doing: reclaimed materials, F&B products locally sourced, everything themed around well being and environment…and all at exclusive hotels with high rates.

And as that concept is working well (5 open, 5 on the pipeline). They have launched another brand, TreeHouse, which has debuted in London recently. Lower rates than 1Hotels (still on the average London £200-300/night/basic room), but the same “eco-approach”.

Most industries will need to adhere more and more to eco-friendly policies in the coming years. If done just to tick the box, it might just represent an investment or cost. But there are ways to monetize it, and guests are willing to take advantage of it, or even pay for it.

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Pablo Torres

Pablo Torres

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