Hoteliers don't plan on eliminating ancillary fees anytime soon, but they say that better communication on the value behind such fees can avoid guest disputes and dissatisfaction.
Resort fees first began at true resorts, said Crown Hospitality Consulting Managing Principal Amanda Chivers during a panel at the recent Hotel Data Conference. But once non-resort hotels caught wind that profits from fees went straight to the bottom line, more wanted in.
However, guests and government officials have recently begun pushing back.
In February, U.S. President Joe Biden said a bill has been written to stop resort fees, through the "Junk Fee Prevention Act."
"We'll ban surprise 'resort fees' that hotels tack on to your bill. These fees can cost you up to $90 a night at hotels that aren't even resorts," he said during a February State of the Union speech.
These fees are typically associated with parking, gym access, pools, pets, room cancellations, room service and cleaning.
Asked if consumers are justified in feeling taken advantage of by fees, Jenna Fishel, senior vice president of commercial strategies at First Hospitality, said "it's in the eyes of the beholder."
"If they feel we have not been very transparent or they don't understand the value, then it's up to them and their perspective to feel that way," she added.
Gopu Menon, executive vice president of distribution at Highgate, said these fees have been around for years.
Transparency on fees is the key to successfully implementing them, the panelists said.
Jason Pirock, head of marketing at Springboard Hospitality, said a guest's journey should be evaluated on how strong the communication is from start to finish.
"That's where a lot of issues have come in the past or where the complaints come from, is that they're ultimately finding it out in the end. The more that we can [make it transparent to them] on the website, in the booking engine, in your transnational emails," he said. "If you set those expectations up front ... I'm not going to say they're going to be happy at the end of the day, but at least they're knowing what they're getting into."
Pirock said there also needs to be quality over quantity when it comes to amenity fees. A lot of times, guests will see that Wi-Fi is included in the fee. However, Pirock believes that Wi-Fi, along with fitness centers, is expected to be included in a guest's stay regardless.
"It's more about quality, what's different, what's unique, what can you give that guest that makes them feel like you're doing something special for them. It could be a guided hike around town — something that's more local to that area or experiential versus just throwing in 10 things that aren't meaningful to them," he added.
Fishel said the booking message online should be the minimum amount of communication. There are additional opportunities when a guest checks in at the front desk to communicate what they will receive during their stay.
Menon said consumers are often aware that what you see isn't what you pay.
"We are all accustomed to not paying what you see ... what you pick up at the shelf is not what you pay at the counter, that's online or offline. Now, what is acceptable? What the consumers are asking is not to abolish these [resort] fees, it's the transparency around how much of the jump is acceptable."
For example, if a price of a guest room online is $200, then at check-out that jumps to $400, "absolutely, that's unacceptable," he said.
"Look at Uber. Have you seen the Uber receipts lately? It's got like 19 things before you pay the final price. So people are used to paying over and above what they see — the question is what is acceptable and what's included in that," he added.
Fishel added that overall, there's likely many hotels in the industry that have the same fees that they did two years ago. One of the most common things she hears is that rates are being based upon what the competitive set is charging.
"One thing I'm really passionate about is, our guest will tell you what they're willing to pay. I think we need to test the elasticity, make some adjustments by season and see where the opportunities are," she said.
In Summary, The Future of Fees
Pirock: "The pros: obviously you have that revenue stream. I think it can be difficult to try to comp that. Where are you going to pick up that revenue if those were removed? The biggest thing we've got to change is ... communication. It has to be throughout the guest journey not just at check-out."
Menon: "Corporate [and groups] don't have a resort or facility fee, so it can be a bargaining chip when it comes to a state of negotiation that this is the rate, how about we knock off the resort fee. But I think we, as an industry, can do better in communicating this better ... customizing it across different brands of hotels. It's a positive revenue stream for not just independent hotels but for brands and franchisees."
Fishel: "The pros: it's a profitable revenue stream. We have to continue to find a way to capture that. The biggest negative is the impact on the guest experience. We do have to remind ourselves that we're in hospitality, they're here for a great experience and we have to make sure we do everything we can to communicate that and not take away from that through the booking journey."