eHotelier Newsletter

Travel in 2002 is a far different activity than it was this time last year. The Index of Leading Economic Indicators reported that activities are up for the fourth straight month. The good news is many of the changes that have occurred are going to result, according to our research, in a domestic travel boom, which will greatly benefit bed & breakfasts, country inns, small lodges and boutique hotels.

And though it would be easy to succumb to dire predictions by the media,
travelers are saying something entirely different. People do not want
to give up travel, one of the brightest features of the North American lifestyle. North Americans are resilient, USA Today surveyed more than 2,600 active travelers in the USA and Canada and 62% said they were more likely this year to travel within North America. And while it is true that some travel habits have changed, it is up to the travel industry to accommodate these changes.

By sector:

Leisure Travel

On the leisure travel front, the changes have been even more profound. Inn members of BBIG International report an increasingly last minute aspect to bookings in this new environment. Price Waterhouse Cooper's research indicates that the factors affecting holiday occupancy had more to do with the economy and air travel inconveniences than it did with safety.

It seems people are delaying leisure travel until the stress driven urge for a break becomes too great to deny. The Conde Nast poll found that 84% of respondents travel to get away and relieve stress. Most people are simply working too hard to forgo occasional short trips, which according to the Travel Industry Association of America (TIA) is the preferred trip type. They then are opting for a drive-to trip on a last
minute basis. Road trips are in, (AAA Travel Barometer). The
preferred mode of transportation continues to be the automobile (Leisure Travel Tracking Poll).

John and Joan, a working couple, e-mail each other:
Gee, honey it's been a long time since we had a break......
Yes, too long. Don't you have Friday off this week?
I do. Remember that little inn up in the Poconos we read about? The one Ashley and Jim fell in love with when they stayed there?
Wow, that sounds good and I think I can burn the midnight oil 'til Thursday and get Friday off too -I'll check and see if they have a room for us.
Mmmm sounds great. See you at home.
And so it goes.

The statistics speak for themselves:

· Almost 85% of Americans plan to take at least two leisure trips in the next 12 months. (Frommer's)

· Blizzard Internet Marketing has noted a sharp increase in the first quarter of 2002 of unique visitors to their 1,200 client B&B sites.

· Forty percent of weekend travelers report they are taking more day trips and/or weekend trips today than five years ago. (TIA)

· And interest in trips lasting more than one week seems to be declining
- 43% of weekend travelers claim they are taking fewer long trips than they did five years ago. (TIA)

· Vacation.com surveyed 30,000 reservations and determined 33% were domestic trips, 29% were Caribbean and 12% were Mexico.

· Leisure trips are more regional and vacations are typically shorter in duration according to Research Information Services.

Although the media is reporting that the travel industry has suffered a tremendous setback, the facts prove differently. Travelers are refusing to stay at home, and that is very good news for the domestic hospitality industry as a whole.

Cruise Travel

According to a Boston Globe article: In the weeks after Sept. 11, cruise lines faced the same phenomenon, as did the rest of the tourism
business: sweeping cancellations by nervous customers. But the cruise industry's ambitious plans - to launch 15 new ships with thousands of berths over the coming year - made things even worse. In response, the cruise lines did what they do best: They slashed prices.

People stopped being scared at about $399, joked Mike Driscoll, editor of Cruise Week, an independent newsletter that tracks ships big and small.

In the months following the attacks, that $399 could purchase a weeklong Caribbean cruise. Folks looking for a shorter getaway could sail for three nights for as little as $149. The $399 and $149, called leaders in the sales business, bought an inside cabin with bunk beds. A bigger room, with a balcony or view of the sea, might be a couple hundred dollars more, per person. Still, the fall prices were as low as they had been in decades.

The strategy worked, and the big ships are again sailing at nearly full capacity. As customers head back to the sea in droves, setting aside any nagging worries about traveling in a floating American city, prices have climbed back up. In some cases, they are at pre-September levels.

Family Travel

Summer promises to bring an onslaught of family vacations because of the number of families who have children in the prime family travel years of 4 -16.

Maura White, president of Gobabies.com, a web site for parents who travel with small children, says, We see a continued high interest in
families wanting to take fun, quick getaways. The TIA found that 35%
of Americans say they've taken their children with them during weekend travel.

A survey released by Hilton Hotels Corporation and Yankelovich Partners earlier this year found that 72 percent of the general public want to invest more time in personal relationships. The study also revealed that eight out of 10 people (81 percent) view vacations as one of the best ways to rekindle a romance, while more than two-thirds (69 percent) believe vacations are a prime source of quality time for families.

Already National Parks are preparing for record crowds as Americans load the kids up in the car for an old-fashioned road trip. In addition, the National Park Service along with the National Register of Historic Places is introducing families to America's cultural heritage. The Register has created themed Travel Itineraries with maps and visitor information for 20 different heritage tours. As patriotism increases, national monuments, battlefields and historic sites are rebounding faster than other destinations. (Wall Street Journal 10/19/01)

There have been no major changes in travel plans over the next six months for households nationwide. Six in ten households still intend to take a leisure or vacation trip in the next six months. (Leisure Travel Tracking Poll - Marketing Workshop, Norcross GA) This will benefit many lodging and tourism businesses, especially family lodges and camps, cabins by the river, kid friendly inns and small resorts in most every area.

Small Lodging

The winners during these precarious times appear to be small lodgings as people search out the regional and personal to enrich their vacations. The primary market orientation of bed and breakfasts/country inns is leisure travelers according to Research Information Services.

The Wall Street Journal article found that Podunkville is suddenly looking good. More travelers are seeking seclusion over big-city hot spots. Fortunately, 80% of bed and breakfasts/country inns are located in villages or rural areas. Most are located within a few hours' drive of a major metropolitan area. Therefore, these inns are already accustomed to accommodating short, regional trips taken from major urban areas.

Spas, especially those within a 3-hour drive of major cities, are also booming, as travelers seek more R&R. (Wall Street Journal 10/19/01)

Robert Mandelbaum, Director of Research Information Services for the Hospitality Research Group conducted a study of the Bed & Breakfast/Country Inns industry. He found that the biggest declines in travel during 2001 have occurred in the commercial and group demand segments … and this represents only a small portion (20 percent) of all guests staying at inns. This compares to 54.1% for the average US hotel.

Travel Now

So the nation and the travel industry is on the road to recovery. And things are looking up for the first time in a while. A new Bear Stearns report from January 28, 2002 states More than four months after the terrorist attacks of September 11, the U.S. lodging industry has begun to show slow signs of stabilizing and, even, significant recovery.

The biggest change that is noted throughout the industry is travelers wanting discounts. Travelocity and Orbitz are expected to have double digit growth this year, mostly because of packages offering special rates.

Jennifer Rubell of Rubell Hotels said her luxury boutique hotel collection is finding that People are having a great time in Miami and with so many global cultural events happening here, we are having a great season. But she continued, value is very, very important to travelers now.

David Whitaker from the Greater Miami Convention and Visitors Bureau said in a USA Today article that travelers are more likely to expect discounts because they know they're available. To survive in an increasingly competitive world, even warm-weather havens need to sell more than sun.

The travel industry is continually changing. The segments of the industry that remain strong are those that have adapted to the times and the weak segments are those that stay in the past. As a whole, the travel industry is moving and growing and will meet this challenge as it has many others throughout history.

The one thing that won't change is that people will continue to travel, as attested too in the Conde Nast poll. 78% of respondents said that travel is their ultimate passion, and nothing will stop them from traveling; 73% said that they will not put off their ultimate dream vacation; and 70% stated that travel is as important or more important to them than prior to September 11th. All of these people will need a place to sleep, to eat and to rejuvenate. And the properties that know how to market themselves to meet the needs of the traveling public, will be the ones that thrive.

From the author:

My love of travel has in many ways defined my life and broadened my horizons. My ongoing mission is to promote boutique lodging worldwide and sustainable travel and tourism as a tool for international understanding and peace. ~ Pamela Lanier

Forbes.com Report by Christina Valhouli

What makes a good hotel bar? Like a good cocktail, it should be one part hospitality, one part service and one part comfort.

Mix all three together and you get a place where out-of-towners can feel comfortable enough to spend a quiet evening alone or where guests can entertain clients or friends. If visitors from Green Bay or Paris are in New York for a night or two and don't know the city well, the hotel bar becomes their de facto retreat, a place where they can feel at home.

However, a good hotel bar becomes popular with locals as well, and problems can arise. In recent years, hoteliers like Ian Schrager and Starwood's W chain have opened hip hotels whose bars quickly became trendy nightspots. For the guest who wants to party like, if not actually with, a rock star, these places are fine, assuming you aren't there to have an important conversation, can get a table and don't mind getting attitude from the staff.

The bars that we have chosen, then, are intended to appeal to a wide range of readers who, even if they are in New York for business, want to include a little pleasure as well.

To read our full list of the Best & Worst Hotel Bars, click on the icons below.

BEST

WORST

From Root Beer Stand to Leading Global Brand, Marriott Marks Diamond Anniversary

Marriott International, Inc. (NYSE: MAR), the company that began as a nine-seat root beer stand in 1927 and today is synonymous with hotels and hospitality in 65 countries worldwide, will celebrate its 75th year in business during 2002. To mark its diamond anniversary, the company said it expects to open its 2,500th hotel, surpass 17 million members in its Marriott Rewards loyalty program, and exceed $ 20 billion in systemwide sales.

"Our 75th birthday is a time to pause and reflect -- a time to thank each and every one of our employees and guests who have made this milestone possible. Great companies are nothing more than great people and loyal customers," said J. W. "Bill" Marriott, Jr., chairman and CEO. "But it's also a time to focus on our future. The lodging and travel industries offer tremendous opportunity over the long-term, and we're ready for the next 75 years."

From those modest beginnings in the spring of 1927 in Washington, D.C., J. Willard and Alice Sheets Marriott gave birth to what has become the leading global hospitality company with more than 2,400 hotels, nearly 450,000 rooms, and more than 140,000 employees. Widely recognized as a world-class consumer brand, Marriott's portfolio of 18 individual brands includes Ritz-Carlton; Marriott; Renaissance; Courtyard; Residence Inn; Fairfield Inn; Ramada; TownePlace Suites and SpringHill Suites. In addition to its hotel brands, the company operates vacation ownership resorts under the Marriott Vacation Club International, Horizons, The Ritz-Carlton Club and Marriott Grand Residence Club brands; corporate housing through Marriott Executive Apartments and Marriott ExecuStay brands, and senior living communities under the Marriott Independent Full-Service, Brighton Gardens and Maple Ridge brands.

"In the past decade, our U.S. lodging market share has grown from around 4.5 percent to nearly 8 percent, and presently our brands account for about a fifth of all hotel construction in the country," Mr. Marriott said. "Looking ahead, our growth prospects remain terrific-particularly internationally where we only have 1 percent of the market. Nearly one-quarter of the hotel rooms in our development pipeline are outside the United States."

While Marriott is primarily known today for its hotels, the initial 1927 root beer stand first expanded into a regional chain of restaurants called Hot Shoppes. Well-known to many East-Coasters, Hot Shoppes pioneered curbside service and was the originator of the Mighty Mo "double hamburger" sandwich. As Hot Shoppes thrived, J. Willard and Alice also launched other businesses. In 1937, they introduced the concept of airline catering by providing passengers with box lunches at Washington D.C.'s old Hoover Field. With Hot Shoppes widely expanded in the 1950's, the Marriotts decided to try their hand at the hotel business, and in 1957 opened the Marriott Twin Bridges Motor Hotel, just outside Washington, D.C., in Arlington, Va.

Over the years, Marriott has developed one of the most highly acclaimed frequent guest programs in the travel industry-Marriott Rewards. With 16 million members, it is the largest program of it kind and recently received its fifth consecutive award as "Best Hotel Rewards Program in the World" from Business Traveler magazine. Also, Marriott's "Spirit to Serve Our Communities" community relations and employee volunteer program and "Pathways to Independence" welfare-to-work program have been recognized by government officials and social organizations as among the best in the private sector.

The 2001 American Customer Service Index (ACSI), a customer survey conducted by the University of Michigan Business School's National Quality Research Center, rated Marriott "best in customer satisfaction." Marriott was also named "2001 Best Domestic Hotel Chain" by Business Traveler magazine, "Best Business Hotel Group" by Business TravelWorld Awards-United Kingdom, and "Best Worldwide Hotel Group" by Irish Travel Trade Awards.

In recognition of the company's long-standing commitment to culture and diversity, Fortune magazine named Marriott "Most Admired Company" in the lodging industry in 2002 and the "50th Most Admired Company" overall; one of the "100 Best Companies to Work For" in 2002; and one of the "Top 50 Companies for Minorities" in 2001 (its most recent minority ranking). Working Mother magazine named Marriott one of the "100 Best Companies for Working Mothers" in its most recent 2001 rankings, and the company is the 2002 winner of the Catalyst Award for advancing women's leadership in the workplace. In its latest rankings, LatinaStyle magazine named Marriott one of the "50 Best Companies for Latinas to Work For in the U.S."

After months of staying home, business travelers are being wooed by hotels and airlines in the biggest marketing blitz since before Sept. 11.

Airlines and hotel chains say they're seeing early, encouraging signs of a travel recovery six months after the attacks. Marketers are spending serious money — and offering unusual incentives — to get travelers' attention as the closely watched spring season begins.

The heavy volume of travel marketing now "is atypical" for spring, says Jerry Dow, United's director of marketing communications. "All of us have waited for the appropriate time. We're all looking at different sets of data, but it's all telling us that travelers seem to be willing to get back out there."

Marriott's new campaign features coaches Mike Ditka, Jon Gruden, Lou Holtz and Phil Jackson "coaching" business travelers on their trips. The vast majority of Marriott's customers are on business. "The message and method are like nothing we've done before," says Deborah Fell, senior vice president for marketing.

It's the first time Marriott — whose brands include Courtyard, Residence Inn and Fairfield — has used TV to promote a Marriott Rewards offer.

Both Marriott and Hilton also report an uptick in group business from meetings. "The markets where we're seeing strength are New York, Washington, New Orleans and Hawaii," says Marc Grossman, Hilton senior vice president.

Travel in the Washington area got a boost Wednesday when the government said it will allow Reagan National to return to pre-Sept. 11 schedules by April 15. National will have about 180 more flights a day, or 800 total.

MORE CORPORATE FLIERS WILLING TO STAY OVER SATURDAY NIGHT

Airlines put the so-called Saturday night stay requirement on their discount advance- purchase fares for one reason only: They want business travelers to always pay top dollar.

By making a traveler spend a Saturday night on the road to get a cheaper fare, airlines literally bank on the likelihood that even those business travelers who are able to plan trips weeks in advance probably won't do so. On a business trip, who wants to spend an idle extra weekend away from home?

Well, it seems that a growing number of business travelers either want to, or will, stay the weekend, according to a new report from Forrester Research Inc. (news/quote)

The Forrester report, based in part on a scientific poll last July of more than 1,500 business travelers, suggests that about a third of business travelers — a segment that is younger and less likely to be married than the average — are quite willing to spend that weekend on the road.

And increasingly, said Henry Harteveldt, Forrester senior travel analyst, companies are realizing that they can still save money even if they offer to pay for hotel, meals and other extra expenses for that leisure weekend.

With a business fare that doesn't require a Saturday night stay, "you're looking at transcontinental fares of $2,300 from, let's say, San Francisco to New York," Mr. Harteveldt said. "But if you plan your trip in advance, and don't mind staying over the weekend, the fare drops to maybe $458."

This segment of the market partly reflects people who relish the opportunity to combine business and pleasure on the road, Mr. Harteveldt said. "They really look forward to business travel, and they don't mind it if their companies say, stay over a Saturday night," if the company is paying the extra costs, he added.

The Saturday night stay requirement has been a buttress of the airline fare structure for over 20 years. Last August, however, after six months of declining revenue from business travel amid complaints about soaring fares, major airlines suddenly dropped the requirement on a relative handful of selected and highly competitive routes clustered in main hubs.

Industry analysts suggested then that the move to eliminate the Saturday night stay could accelerate. But the airline industry collapsed after Sept. 11; many of those attractive business fares that did not require a Saturday night stay also collapsed. Total losses for the year exceeded $7 billion. In the months after September, with business travel off even more, airlines instead furiously cut leisure fares on certain competitive routes in desperate attempts just to fill airplanes.

Now, with business travel coming back, and with many leisure fares so low, business travelers have been more unhappy than ever about the prices they pay.

Aware of that, airlines have begun to shift attention once again to business travelers as the busy warm- weather travel season approaches. For example, United Airlines said yesterday that it would add about 15 percent more flights from its Chicago hub and cut some fares this summer, in a bid to attract returning business travelers.

"We believe that if we put the schedules in that address what the business flier is looking for, it benefits the leisure flier as well, because they'll have the opportunity to have the same kind of multiplicity of opportunities," said Chris Bowers, United's senior vice president for marketing.

"The business fliers want to go when they want to go," he added. "The business travelers have been telling us since we pulled the schedule down following Sept. 11 that we were thwarting their ability sometimes to be as flexible on the road as they need to be."

This week, United and several competitors also extended special discount fares intended to attract business fliers on highly competitive routes. On many of those special fares, the Saturday night stay requirement has been dropped for the extent of the sale.

The new Forrester research, however, indicates that whatever the future resilience of the hated Saturday night stay, some business travelers have decided that if they can't beat it, they'll join it.

Because some business travelers are buying the advance-purchase fares with the weekend stays, "airlines can no longer easily tell at a glance who's a business traveler and who's a leisure traveler," Mr. Harteveldt said.

"Business travelers have reached the breaking point" with fares, he added. Some of them, he said, now "are taking this opportunity to reinvent themselves from a pricing standpoint."

Susan Black, a business-strategy consultant from Woodcliff Lake, N.J., who travels about 100,000 miles a year on business, is one of them.

"In the past I never entertained Saturday night stay-overs because I try to balance my life with my work," said Ms. Black, who is married and has two children, ages 2 and 4. "But now all of a sudden it's beginning to look a lot more attractive, when you see a round-trip fare that jumps from $200 to $2,000" between the leisure and business rates, she said.

The fare discrepancies "are more pronounced" since September, said Ms. Black, who still has to fly often on short notice and pay the top fare. But whenever possible, when business needs and family itinerary allow it, she now opts for the cheap fare that requires a weekend stay.

"Sometimes I'll take one of my kids, and try to make it a bit of bonding time," she said.

Hong Kong was spared the full effects of September 11, thanks to the China market, says Clara Chong (right), executive director, Hong Kong Tourism Board, in her assessment of Hong Kong’s hospitality industry, post 911.

“Hong Kong has been more fortunate than many destinations in the wake of the September 11 terrorist attacks as we have the huge, and largely unaffected mainland China market at our doorstep.

While other source markets were still in the doldrums, arrivals from the mainland registered nearly 30 percent growth in the fourth quarter of 2001 alone, reaching 4.48 million for the full year.”

However, all markets, after hitting a low point (3.3 percent decline) in October, made a faster-than-expected recovery in November and December. In December, Hong Kong welcomed its highest-ever number of visitors in a single month – 1.3 million.

“For the full year, arrivals grew 5.1 percent to a record 13.7 million, a far better performance than anyone could have hoped for three months earlier,” said Chong.

In terms of impact on hotels, top tariff hotels were the worst affected and saw occupancy dip further, to as low as 67 percent in September. They recovered to 74 percent for the year, which is still some way below the 82 percent of 2000.

Medium tariff hotels that cater particularly to mainland Chinese and short-haul visitors have continued to perform well, averaging 80 percent occupancy for the year.

Hotels outside the main tourist areas of Central, Wan Chai, Causeway Bay and Tsim Sha Tsui have proved especially popular, achieving over 90 percent occupancy in November and December.

Chong said one effect of this was the growing recognition by hotels of the value of mainland visitors and their rapidly increasing spending power; they are second only to those from The Americas.

“Many larger hotel groups that have not previously considered Mainland China an important target market are now readjusting their strategies.”

Chong said that barring any further serious incidents, “we have confidence that the recovery will continue into 2002 and, indeed, that the industry can bounce back even stronger than before”.

PATA SEEKS TO BOLSTER MIDDLE EAST TIES – TO EXPLORE WAYS TO CAPITALIZE ON THE GROWING TRAVEL FLOWS BETWEEN MIDDLE EAST AND ASIA PACIFIC REGIONS

The Pacific Asia Travel Association (PATA) has extended a special invitation to senior travel and tourism executives in the Middle East region to attend the 51st PATA Annual Conference in New Delhi, April 14-18, 2002, to explore ways to capitalise on the growing travel flows between the two regions.

PATA President and CEO Mr. Peter de Jong last week sent out personal letters to nearly 200 senior executives of travel and tourism companies, hotels, airlines and national tourism organisations in the Middle East inviting them to the April conference to build upon this very promising trend.

"As our Annual Conference is always attended by top executives from the Pacific Asia region, it will be a great opportunity for their counterparts in their Middle East to network, develop contacts and explore future business opportunities," Mr. de Jong said. "PATA research shows a growing interest in travel between the Middle East and the Pacific Asia region. Both have long held relatively small market shares in the total arrivals of countries in both regions and it is now clearly time to build this up."

Mr. de Jong noted that many Middle East airlines such as Emirates, Qatar Airways and Gulf Air are growing their networks in the Pacific Asia region.

There is increased interest in travel from the Arab Gulf region to Australia, New Zealand, India, Singapore, Malaysia, Indonesia and Thailand. At the same time, there is considerable potential for outbound travel from the Pacific Asia region to the United Arab Emirates and other Gulf countries, as well as Jordan, Egypt and Syria.

"The two regions enjoy extensive cultural and historic links," Mr. de Jong said. "It is long overdue for us to capitalise on them."

He said PATA is planning to invest strongly in promoting more outbound travel from the Middle East to the Pacific Asia region in future by producing more research, attending Middle East travel trade shows and organising seminars and workshops.

"We would like to work with our Arab counterparts to see what further opportunities exist for more two-way travel between the two regions. I think having a strong Middle East presence at the Conference will send a strong indication to PATA members of the future potential of this new opportunity."

As a further incentive to the Middle East executives, PATA is offering a special one-time participation package to introduce them to the networking benefits of the Association.

The Conference programme, hotel and airline details, destination information and registration forms are located online at www.pata.org. For more information, please e-mail: conference@pata.th.com. Fax: (66-2) 658-2013.

The 51st PATA Annual Conference is supported by PATA's Premier Partners: MasterCard, National Geographic Traveler, Time Inc. Asia, Interval International, Stone Ground Solutions, CNN and Tesa Entry Systems. PATA's Premier Partners, a select group of companies, are committed to investing in the future of Pacific Asia.

Australian tourism has been told it suffers from a perception that it is too laidback.

“It’s time for the Australian tourism industry to be taken seriously,” said Australia’s federal tourism minister, Joe Hockey. “It deserves the same gravitas as other major industries in this country.”

Hockey said tourism’s image as a ‘good time’ industry was holding it back. The minister has the support of several key industry leaders.

“Like Joe Hockey, the supposedly frivolous impression of the industry annoys me greatly,” said Michael Issenberg, managing director Accor Australia/NZ/Japan. “But I think government can lead the way in changing that view by providing support in terms of export marketing, human resources initiatives, favourable taxation policies and fewer punitive taxes.”

Issenberg said tourism was still the first industry to have taxes imposed upon it. “And unfortunately they are rarely lifted, making a struggling industry struggle even further.”

He said the biggest problem was that people usually characterised hotels as luxurious resorts or five-star city hotels. “The reality is that many of these hotels and resorts are struggling, whereas the majority of functional, hard nosed hotels in the ‘economy’ sector are performing strongly, if not glamorously.”

He acknowledged that the industry still had room to move in terms of getting across the ‘hard-nosed’ business edge of tourism and hospitality.

Jon Hutchison, managing director of the Sydney Convention and Visitors Bureau said the issue was ignorance, much of which had always existed in governments as well as communities. “Why is this so? It’s because if you have a whole lot of industries, often competing with each other, it is hard to get an agreed, consistent voice.”

David Shackleton, Starwood’s area managing director, Australia, New Zealand and Fiji, said he believed the tourism industry recognised the need to be constantly proactive and was not resting on its laurels.

“The importance of the tourism industry cannot be underestimated,” said Shackleton. “Further recognition and emphasis by governments and industry towards its development will certainly enhance its value and contribution to the economy.

“The nature of the product we are selling is perceived as a desirable experience which may account for the ‘good time’ perception. However, (tourism) management and businesses face the same issues as other commercial enterprises.”

Leigh Harry, chief executive of the Melbourne Exhibition and Convention Centre, and chairman of the Business Events Council of Australia, said that the tourism industry, as a very significant earner of overseas dollars, should be taken much more seriously. “But it would be fair to say the industry, including the business tourism sector, has not been as good as it should be in proving its own worth.”

HONG KONG HOTELS SECTOR CHALLENGES PRICELINE.COM SAVINGS CLAIM

South China Morning Post - Hutchison-Priceline.com, the Li Ka-shing-controlled online ticketing agency, claims users can save up to 30 per cent in hotels and flight charges through its reservation system, compared with conventional channels.

However, hoteliers and other ticketing agents say the system does not offer any better rates than other travel wholesalers.

They argue that the Priceline model is flawed and, while it has been successful in the United States, it would have little impact on the business of tour operators in Asia, where travellers' behaviour has proved hard to change.

In an invitational trial sent out last week, Hutchison-Priceline invited VIP users to try its "name-your-own-price" model in Hong Kong, which allows consumers to bid for air tickets and hotels in the region. The formal launch is scheduled for next month.

The joint venture is linked to airlines in 41 countries in the US, Europe and Asia except China, and offers hotel rooms in 16 countries, including China.

According to the company's promotional material, "thousands of air tickets and hotel rooms go unsold each day" and Priceline can save up to 30 per cent in average retail prices.

Christoph Oberli, e-commerce manager of Mandarin Oriental, said the group's four-star Excelsior Hotel in Causeway Bay had signed up.

"We will certainly offer our good rate in the period where demand (is) generally low," he said.

"However, our policy is we sell at the same or similar prices to all our channels. So whether someone is from Hutchison-Priceline or not, the price should be more or less the same.

"We prefer to go with our four-star property first because it is a relatively new concept of online reservation."

Shangri-La Asia spokeswoman Julia Record said: "We are looking at it but nothing has been signed.

Le Meridien Hotels and Resorts, which has 144 hotels in 57 countries, is also in discussion with Hutchison-Priceline.com, according to a spokesman.

Derek Loke, regional director of sales at Meritus Hotels & Resorts, which did not join the programme, said it was not easy to compete with the big tour operators as they could secure very good deals with hotels and airlines.

"As far as I know, it will upset the wholesale partners if they knew hotels to give an unexceptional low offer to a particular agency," he said.

He believed there should not be a significant shift of hotel reservations from traditional channels to the online ticket agency.

Barcelona, Madrid, Lisbon, Vienna and incumbent Geneva are in the running to become home to EIBTM in 2004.

Managing director of Reed Travel Exhibitions, Tom Nutley, said a decision on which of the five cities would win Europe’s biggest incentive and meetings trade show would be decided by the summer.

The main criteria, he said, was availability of hotel inventory of four and five star quality and the airlift. “All five have got the venues.”

At the same time, RTE is also reviewing the dates of the event, which has been held in May since its inception more than 10 years ago.

Nutley said RTE was carrying out a survey among attendees to determine the best timing for the event. “We are reviewing May.”

U.S. CONVENTION BUSINESS PICKS UP ONCE AGAIN; TRADE SHOWS START HOPPING, HOTELS BUZZ AFTER BIG SLUMP

USA Today - The $ 100 billion trade show business, walloped by the recession and travelers' fear of terrorism, is rebounding faster than expected.

Industry leaders say more business people are jetting to trade events and filling hotel rooms again nationwide. Tradeshow Week predicts attendance will return to single-digit growth rates this summer, after falling 20% in the fourth quarter -- the worst drop ever.

"If the recession is over and there are no more airline incidents, we believe we'll see a sharp comeback," says Tradeshow's Michael Hughes.

* Las Vegas abuzz. Shortly after Sept. 11, more than 200 trade shows and meetings were canceled in this famed gambling town. Convention attendance swooned 36% to 165,000 in September. Taxis were easy to find. Asian travelers and gamblers, a big source of revenue, stayed home.

Now Vegas is booming again. Hotel room occupancy -- down to 74% last September -- is climbing back to 80%-plus. The giant Consumer Electronics Show in January booked a record 1 million square feet of exhibitors' space. Asian travelers are back, with Japan Airlines and Singapore Airlines adding new flights this year to Las Vegas. "Things are returning to normal," says spokesman Rob Powers of the Las Vegas Convention and Visitors Authority.

* San Francisco rebounding. The high-tech crash hurt this postcard-pretty city last year, as the number of business travelers in town for meetings fell 25%.

But the city's convention business keeps growing, with major trade shows by Apple Computer, Oracle, IBM and other companies. Hotels also are reporting an upsurge in business travelers booking rooms for small conferences and meetings this year.

"So far, all signs are signaling optimism," says Mark Theis, vice president at the San Francisco Convention and Visitors Bureau.

* Orlando upbeat. The economic gloom and Sept. 11 led to 25% of travelers canceling their trips here last quarter. Today, only 10% of travelers are canceling, and hotels are starting to hire back laid-off workers, says William Peeper, president of the Orlando Convention and Visitors Bureau. "Demand clearly is picking up," he says.

* New York rising. Legions of business travelers are changing their meeting sites to New York in a show of support for the devastated city. Hotel occupancy rates climbed to 60% recently from 30% in September, says Cristyne Nicholas, president of NYC & Company, formerly the New York Convention and Visitors Bureau.

Why such confidence? People no longer fear flying. Corporations are opening their travel coffers. Tourism officials are offering discount travel deals. And, if Federal Reserve Chairman Alan Greenspan is right, the recession is dead.

Newsletter - March 18, 2002

TRAVEL INDUSTRY OUTLOOK, SPRING 2002

BEST

WORST

MORE CORPORATE FLIERS WILLING TO STAY OVER SATURDAY NIGHT