NASHVILLE, Tennessee — From the days of the week they stay to the channels they book in, the lines between leisure and business travelers continue to blur for hoteliers, making pricing and marketing strategies hazier.
Speaking during the "Making Sense of Segmentation" session at the 2023 Hotel Data Conference, Erin Cerrato, regional director of revenue management for McKibbon Hospitality, said her company is now fielding requests for their vacation rentals that would imply guests are business travelers.
"I see a lot of emails from our incoming guests requesting confirmation that we have high-speed internet because they have conference calls that they're going to be taking or for late departures because they have meetings that they need to attend," she said, adding these are signs these are guests blending leisure and business — commonly referred to as bleisure travelers.
Harry Carr, senior vice president of revenue management for Davidson Hospitality's lifestyle division Pivot Hotels, said he's seen similar trends, which extend to how guests book rooms. He added bleisure travelers have led to an uptick in demand for shoulder days, particularly Thursdays.
"The trend is if you can leave on a Thursday night [for a vacation] then work part of the day on Friday, you can start that weekend a little bit earlier," he said. "For us, there's a blend of segmentation and channel. Your typical business traveler may be booking through Expedia because they're more in that leisure mindset."
Jason Pinto, co-founder and chief operating officer of Pace Revenue, said traditional segmentation is almost impossible at this point, and hoteliers must be "dynamic" to adjust to blended travel demand.
"You really can't set segmentation in the start of the year at budget season and never think about it the rest of the year because things are changing," he said.
Cerrato said hoteliers adjusting to the change must not get "stuck looking at past trends" to determine the best strategy as demand shifts.
Carr agreed, adding that hoteliers should have a clear idea of what their top demand generators will be for a full year ahead.
"Are you looking at a certain week where you know there's no citywide conventions and you know schools are back in session and coming up with a plan?" he asked.
Pinto said this is a good chance for revenue managers to lean on their colleagues in marketing, who have more experience with "lookalike modeling" and dynamic customer segmentation, then directing marketing dollars to the best platforms to reach them.
"The advertising world has figured out how to do this dynamically in a really clever way," he said.
Cerrato and Carr said this is an opportunity for hoteliers to take another look at the total costs of acquisition for guests.
Cerrato said it's relatively easy to drive demand through online travel agencies, but the cost often comes from more than just the base commission.
"Once you start deploying any types of promotions or offers, those can stack and quickly add up if you're not fully aware of the implications," she said. "You can easily add in an accelerator then have a mobile offer and all of those are going to stack."
Carr added there are different cost structures for different channels, such as online travel agencies and global distribution systems.
"You still have to look at it holistically," he said. "What is it costing you to get that customer through the door?"