Reasons for the Popularity of Micro-Hotels - Coursework Example

Micro-hotels Table of Contents Reasons for the popularity of micro-hotels 4 Differences between micro-hotels and traditional hotels 6 Micro-hotels affect today’s hospitality industry 7 Trends for micro-hotels 9 References 12 (2011). Sleepbox: new airport micro-hotels offer travelers rest by the hour. Skyscanner. Retrieved from http://www.skyscanner.net/news/sleepbox-new-airport-micro-hotels offer-travellers-rest-hour 12 Adler, A. (2009). Micro-Hotels Offer NYC Visitors Cheap, Chic Digs. Npr. Retrieved from http://www.npr.org/templates/story/story.php?storyId=102800216 12 Hume, T. & Macguire, E. (2012). Airports tiniest hotels: Sleeping in a box. CNN. Retrieved from http://edition.cnn.com/2012/06/19/travel/airport-microhotels/ 12 Muther, C. (2014). A tight squeeze in New York’s stylish micro-hotels. The Boston Globe. Retrieved from http://www.bostonglobe.com/lifestyle/travel/2014/08/16/tight-squeeze new-york-rooms-get-smaller-and-more-stylish/EPttfB1zsagUF76XCWrckN/story.html# 12 Ross, C. (2014). Yotel plans micro hotel for Boston. The Boston Globe. Retrieved from http://www.bostonglobe.com/business/2014/06/03/yotel-plans-micro-hotel-for boston/jJIHuyDyItofknxrYEEx8L/story.html 12 Sorensen, A. (2014). New York City’s Pod Hotel Revolution: The Glamour of Staying Small. New York.com Retrieved from http://www.newyork.com/articles/hotels/new-york-citys pod-hotel-revolution-the-glamour-of-staying-small-32824/ 12 13 13 Introduction A micro-hotel is a hotel with a space conscious floor plan. Such hotels have small rooms with basic amenities. The type of hotels has been on the rise especially in the past few years. Unlike motels that had similar features with unique out of town locations, micro-hotels are like any other and compete for the mainstream hospitality industry. Some micro hotels enjoy prime locations and offer a variety of services. In fact, the growing trend in the industry is that micro hotels boast of prime locations and pride themselves in offering luxury services just like any other five star hotels. The most distinguishing feature of micro-hotels therefore is the small room sizes coupled with the availability of the essential amenities within the space (Muther, 2014). Among the leading global brands of micro-hotels are Yotel, Nepcabs, Sleepbox and minute suites among many others. The above are brands just like any other and therefore engage in intense competition as they strive to grow their market shares. The development of micro-hotels is an avid portrayal of the adaptability of the hospitality industry. The unique type of hotels survives on a substantial market niche that requires a unique set of services from such facilities. The hotels main objective is to provide their customers with sleeping space. They do this by maximizing on the space. However, in order to retain a competitive advantage over the many similar hotels, various micro-hotels have begun expanding the nature of their services and products. Such companies as Yotel pride themselves in the provision of high quality services. The small rooms have warm showers and free Wi-Fi among other vital amenities that enhance the comfort and luxury of a hotel. Micro-hotels are relatively new concept in the hospitality industry. This makes it difficult to determine their position in the industry. However, the rapid nature of their expansion shows that they responded to a need in the society. Yotel for example introduced a new strategy to the business by opening a number of its outlets at some of the leading airports in the world. This way, the micro-hotel taps on a market comprising of travelers seeking to rest as they await their flights. In order to meet the demand of such group of customers, the group of micro-hotels formulated an hourly basis form of payment that enables a customer to rent a room for a couple of hours. Reasons for the popularity of micro-hotels Micro-hotels have become increasingly popular in the modern society owing to a number of factors key among which is their relatively low prices (Adler, 2009). The fact that micro-hotels have smaller rooms and offer fewer services than conventional hotels do makes the cost for their services lower. The low cost coupled with the convenience the facilities offer their customers is responsible for the spontaneous popularity of the hotels. Millions of travelers continue searching for cheaper and convenient hotels that offer tailored services and micro-hotels are always the most favorable in such cases (Hume & Macguire, 2012). This way, the hotels became popular in social networking sites and with the numerous travel agencies who offer travel advice through their own platforms. Furthermore, the growing popularity of micro-hotels globally made the market increasingly lucrative. Numerous investors have therefore sought to constrict micro-hotels in strategic locations. This way, the unique type of hotels became popular within a short duration. Micro-hotels have succeeded in building desirable reputation through the quality of services and the convenience they offer. Micro-hotels offer luxury services and convenient locations in numerous cities throughout the world (Ozy Editors, 2014). Furthermore, the cost of the high quality services is lower in micro hotels than in the traditional hotels. Such factors enhance the creation and spread of the desirable reputation about the hotels a feature that enhances their popularity. A number of the hotels are located in such strategic locations as airports among many others. The large population in such locations do not only increase demand for the services of the hotels but also increase their reputation regionally. Yotel, a brand of micro-hotel, has developed successful outlets in various airports around Europe including in Heathrow, Gatwick and Amsterdam (Tyler, 2009). Such strategic location is among the basic factors responsible for the popularity of the facilities in the modern society. The managements of the micro-hotels just as those of any other business continue to carry out extensive marketing for their products and services. The managers run a number of extensive adverts on the conventional media such as televisions through radios. The micro-hotels have functional websites and have interactive handles on the various social networking sites. The managements use the media to advertise the hotels thereby enhancing the popularity of the hotels. Furthermore, the managements of the micro-hotels continue to employ radical marketing strategies in their attempt to grow their market shares. Key among such strategies is the formation of chain structure. Numerous brands of micro-hotels strive to form franchises in various countries. As explained earlier, Yotel has outlets in Amsterdam and London among other countries. Such is an effective strategy that does not only enhance the profitability of the respective businesses but also increases the popularity of the unique types of hotels. The uniqueness of micro-hotels position them competitively against the traditional hotels a feature that enhances the spread of their popularity. Yotel for example employs a unique payment per hourly billing structure that makes the hotel appropriate given the equally unique demands of its target customers. The per hourly basis makes it possible for travelers at the airports to rent rooms, which they use for a number of hours as they await their flights to different destinations. Such unique services coupled with the strategic location of the hotels make the micro hotel popular with seasoned travelers. Additionally, micro hotels are popular among the middle class and business people who travel extensively throughout the world. The hotels offer high quality and all-inclusive services most of which they tailor to the specifications of their customers. The provision of such good services at lower costs makes the hotels popular among the middle class. Differences between micro-hotels and traditional hotels Micro-hotels are different from the traditional hotels. Among the differences is in the room sizes. As explained earlier, micro-hotels have smaller rooms, which comprise of the basic amenities. Traditional hotels have large rooms fitted with a number of both basic and auxiliary services. While a micro-hotel may have rooms fitted with a basic overhead shower, traditional hotels have comfortable rooms fitted with bath tabs and cable televisions among other services. The difference in the sizes of rooms between the two types of hotels is a fundamental factor, which helps differentiate a micro hotel from any traditional hotel. A micro-hotel targets customers who seek the sleeping services. Micro-hotels offer such conveniences without indulging in many other auxiliary services. The nature and quality of services also differ in the two types of hotels. Traditional hotels offer comprehensive and all-inclusive services given the fact that they target a large customer bases. Traditional hotels for example target those on holidays while some target those on business trips. The two classes of customers require unique types of services. A traditional hotel strives to meet the demands and expectations of the above and many other categories of customers. Micro-hotels on the other hand are facilities that people seek for convenience. They target people who want a secure and comfortable space to rest of spend a night. This influences the nature of their services and amenities. While most micro-hotels strive to enhance the luxury of their services, traditional hotels have a larger base of services and products than micro-hotels do. Additionally, traditional hotels are larger businesses than micro-hotels are. Most hotel brands are multinational chains with multibillion dollars’ worth of assets in various locations throughout the world. Such companies as Fairmont group of hotels, Hilton hotels and Ritz-Carlton Hotel Company, L.L.C among many other companies that own hotels have invested large amounts of money in creating the businesses. A single hotel is worth billions of dollars owing to the types of amenities and services such hotels offer. Ritz-Carlton Toronto for example has a number of amenities. The hotel has a shopping arcade, conference facilities, eateries and theatres among many others. This differs with the structures of micro-hotels, which are smaller business ventures. The famous Yotel for example is a smaller business compared to any other traditional hotel. Yotel’s rooms are small and lack any extensive investment. Furthermore, the micro-hotel exists a single institution that depends on the airports to get businesses. Micro-hotels affect today’s hospitality industry Micro-hotels typify the future of the hospitality industry. The small hotel structures that feature every amenity in a single space continue to become common in different parts of the world. The managements of the hotels continue to carry out extensive marketing for the businesses with the view to building substantial market shares just as is the case with any other conventional business. The unique type of hotels target the conventional hospitality market a feature that enhances its effects on the industry. Key among such effects just as explained is the fact that they heighten competition the increase in the number and popularity of the hotels in some of the leading tourist destination implies that they heighten the competition in such markets since the traditional hotels must counter the growth of the micro-hotels. As competition in the hospitality industry heightens, micro-hotels continue to show preference for the internet where they carry out extensive marketing and permits for online booking of their rooms with other facilities. Such is a major effect on the industry as several other services providers including hotels and airlines have equally joined the online platform and therefore continue to run their businesses online. Through the online platforms, hotels have created functional websites that permit the management to admit customers. Another equally important advantage of using the online platform is the fact that it globalizes operations. Such micro hotels as Qbic in Amsterdam and London and EasyHotel and Yotel among many others have succeeded in developing global brands that attract customers from different parts of the world. The micro hotels target visitors. Among the most fundamental features of micro hotels is the fact that they avail every possible amenity within the reach of a customer. The small rooms have every possible amenity that enhances the comfort of the customer; the hotels are always convenient to the customers. Such is a major effect in the hospitality industry as every service provider strives to enhance convenience in his or her facilities. Modern day traditional hotels select their locations carefully with the aim of situating their facilities in convenient locations. Additionally, the hotels strive to equip their rooms with the most fundamental amenity. Most hotels have casinos, spa treatments, shopping malls and eateries among other amenities all of which are strategies that enhance the convenience they offer their customers. Micro hotels have increased the need for luxury services in the hospitality industry. The fact that micro-hotels offer small rooms makes them less costly than other conventional hotel rooms. However, the managements of such hotels have found a way of infusing luxury in the small rooms. Sorensen (2014) explains that most of the leading micro-hotels offer excellent luxury services, a feature that makes the hotels a preference to most international travelers. In an attempt to counter this, the conventional hotels continue to revamp their products and services thereby improving the quality of services in the hospitality industry. Currently, every service provider strives to provide high quality services. Most modern hotel rooms have free WiFi, and Jacuzzis among other personalized services. The move towards the upscale luxury in the services is an effect of the rise in the popularity of micro-hotels as the traditional hotels use such strategies coupled with their large room spaces as competitive advantages. Trends for micro-hotels As the fame and demand for micro hotels continue to grow, the facilities have introduced new trends that help position them strategically thus beat the high competition in the hospitality industry. Key among trends is the strategic positioning of the micro hotels. As explained earlier, micro hotels strive to offer immense convenience to their customers. Location enhances the convenience of the facilities. As such, most investors set up their micro hotels in strategic locations with the latest trend being in airports. Micro hotels in Heathrow airport offer unique services as travelers find convenient and luxurious rooms where they sleep. The micro hotels provide an essential service thereby eliminating a need that had otherwise proven costly. Currently, travelers do not have to worry about the safety of their luggage in case they fall asleep while waiting for their flights. Additionally, travelers can sleep within the precincts of the airports and do not therefore incur additional transport costs as they seek hotel services. Another equally functional trend in the unique industry is the introduction of the pay-by-the-hour billing system. The structure of micro hotels makes the billing strategy effective. Yotel, a famous micro-hotel in Heathrow, Gatwick and Amsterdam, among many other micro-hotels have perfected the art of charging in the per-hour billing since some of their customers seek the rooms for a couple of hours before they board their planes. The unique billing system sets micro-hotels apart from other conventional hotels. Additionally, the billing system makes the hotels more convenient than the other conventional hotels that do not support such systems of billing. Micro hotels tailor their services to fit the unique demands of their customers. Those located in airports for example have a variety of services including an exclusive sleeping space, a room that a traveler hires for hours as they wait for their flights. Micro-hotels just as the other traditional hotels are increasingly creating chains. The formation of chains is a unique trend that offers the hotels an opportunity to market their brands globally. A number of micro-hotels including Yotel continue to open up new outlets in various countries (Ross, 2014). The micro-hotels select their countries of operations carefully often setting shop in some of the leading global destinations. Additionally, they set up outlets in strategic locations in the countries thereby enhancing their competitive advantages. Microtel Inns & Suites is yet another example of a successful global chain of franchises. The chain has a number of outlets in Mexico, Canada, Argentina and Philippines. The creation of chains is an effective marketing strategy that enhances the success of such companies. The structure makes the hotels benefit from referrals besides lowering the marketing costs. Such micro-hotels for example have efficient systems of customer loyalty rewards that enables them build bases of loyal customers throughout the world. Finally, micro hotels continue to collaborate with other service providers in the same industry. Collaborations reduce the cost of marketing thereby enhancing profitability. A number of the hotels have collaborated with various airport authorities in some of the leading cities like London and Amsterdam among others. Other micro-hotels have collaborated with travel agencies. They therefore receive referrals from such institutions. Besides collaborations, micro-hotels continue to diversify their services. Qbic in London and Amsterdam for example pride itself in the provision of high quality conference facilities and meeting venues. By diversifying its services, the hotel is systematically building a brand in the market niche. References (2011). Sleepbox: new airport micro-hotels offer travelers rest by the hour. Skyscanner. Retrieved from http://www.skyscanner.net/news/sleepbox-new-airport-micro-hotels offer-travellers-rest-hour Adler, A. (2009). Micro-Hotels Offer NYC Visitors Cheap, Chic Digs. Npr. Retrieved from http://www.npr.org/templates/story/story.php?storyId=102800216 Hume, T. & Macguire, E. (2012). Airports tiniest hotels: Sleeping in a box. CNN. Retrieved from http://edition.cnn.com/2012/06/19/travel/airport-microhotels/ Muther, C. (2014). A tight squeeze in New York’s stylish micro-hotels. The Boston Globe. Retrieved from http://www.bostonglobe.com/lifestyle/travel/2014/08/16/tight-squeeze new-york-rooms-get-smaller-and-more-stylish/EPttfB1zsagUF76XCWrckN/story.html# Ozy Editors. (2014). On the road: Micro-hotels, rental bathrooms and more. USA Today. Retrieved from http://www.usatoday.com/story/travel/2014/03/01/ozy-roundup-stories airbnb/5923393/ Ross, C. (2014). Yotel plans micro hotel for Boston. The Boston Globe. Retrieved from http://www.bostonglobe.com/business/2014/06/03/yotel-plans-micro-hotel-for boston/jJIHuyDyItofknxrYEEx8L/story.html Sorensen, A. (2014). New York City’s Pod Hotel Revolution: The Glamour of Staying Small. New York.com Retrieved from http://www.newyork.com/articles/hotels/new-york-citys pod-hotel-revolution-the-glamour-of-staying-small-32824/ Tyler, A. (2009). Micro hotels go big. Travel + Leisure.com. Retrieved from http://www.travelandleisure.com/articles/thinking-small Read More