Hotel school students and even professors often forget that tourists, whether travelling for business or leisure, are drawn to destinations in the first instance - not to any particular hotel.
Indeed, the choice of lodging is almost always a secondary consideration when planning a trip.
Looked at from another point of view, a hotel no matter how luxurious and how good the service, will likely be a miserable failure if it's in a location that has nothing to attract visitors.
That's why it's important for hoteliers to work closely with the tourist office or destination management group in charge of promoting the city or resort where the property is located.
Besides demand-drivers like business headquarters, conferences, exhibitions, beaches, mountain resorts and UNESCO World Heritage sites, transport links are also an important consideration. Thus high-speed rail lines, low-cost carrier networks and airport capacity can be important determinants of hotel performance.
Destinations compete for incentive business
Hotel guests can be basically segmented into corporate business travellers, conference-goers and holidaymakers.
Obviously the choice of destination for those on corporate business is pre-determined by the location of the headquarters, subsidiaries, clients and suppliers of the firm.
Meanwhile, the MICE (meetings, incentives, conferences & exhibitions) segment shows more flexibility regarding destination choice. In particular, incentive trips are open to a wide choice of destinations and there is intense competition amongst them to attract business.
Five-star luxury hotels in Switzerland, such as the Victoria-Jungfrau in Interlaken, the Montreux Palace or the Beau-Rivage Palace in Ouchy, have traditionally been active players in this segment. (Incentive trips are at the crossroads between human resources management and tourism and are typically organised by companies to reward key employees (e.g. the best salespeople) and to foster intra-enterprise networking.)
According to the "Trends Watch Report 2016" by Dr Rob Davidson, ibtm world Industry Analyst, the US is the most frequently cited destination for incentive trips and, in 2016, the average per-person spending on incentive trips was US$3’165, which is the highest it's been since 2008 when it stood at US$3’659.
The traveller’s path to purchase
Many travel shoppers in the UK, US and Canada, investigate multiple destinations at the start of the booking process.
In fact, more than half of online travel shoppers in the UK and Canada begin their trip planning with more than one destination in mind, according to an Expedia whitepaper, entitled, "Destination selection during the traveler’s path to purchase", which tracks the travel search habits of leisure travellers.
In the US, however, only about one-third of travellers consider multiple options at the beginning of their online searches.
It can be surmised that the difference in vacation time accounts for this discrepancy, since Americans typically have fewer holidays than the British or the Canadians.
Canadians more adventuresome than Americans
The whitepaper found that travellers tend to research locations worldwide.
Unsurprisingly, due to geographical proximity, UK travel shoppers were the most likely (61%) to search locations in Europe. Interestingly, Canadians evidence a far more adventurous approach to destination selection than Americans, with Europe being their most frequent choice, followed by South America and Asia.
Meanwhile the first choice for Americans is domestic travel.
Only after careful reflection
Selecting a leisure travel destination is a heavily pondered decision, not made on the spur-of-the-moment.
This becomes apparent when looking at the number of visits to travel sites that the average travel booker makes in the seven weeks leading up to the purchase of a hotel stay, air ticket or travel package.
On average, Canadian travellers conduct the most research, registering 161 visits to travel sites during the seven-week period; meanwhile Americans make 140 visits on average and the British 121 travel site visits.
When broken down on a weekly basis, average travel site visits per week range from 17 to 23 across the three markets.
About a third of searches in the three countries are on OTA (online travel agencies) sites, which rank as the most important source of information during the 45 days preceding a travel booking.
For all three markets, travel information sites (such as Tripadvisor.com and Nationalgeographic.com) are the second most important online resource, accounting for between 21% and 26% of site visits.
Accommodation an important criterion
As they move through the booking cycle, travel shoppers refer to different resources for ideas and suggestions as to where to go, but when it comes to taking a final decision, the leading factor for selecting a destination in the three countries is cost.
However, beyond budgetary considerations, travellers from all three markets consider hotel/accommodation options when deciding where to go.
Indeed, 34% of British travellers, 27% of Americans and 29% of Canadians consider hotel/ accommodation options as a key criterion for their destination decision.
Additional factors that travellers take into account include recommendations from family and friends, information about the weather and climate, reviews and ratings, activities, travel time to the destination and available loyalty programmes.
However, these criteria are of lesser importance when making the final decision about where to go.