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How Hotels Can Engage Gen X and Millennial Guests

August 20, 2014 | in Business, News

Gallup's latest hospitality study reveals the preferences of the up-and-coming generations of guests, who could reshape the industry

Offering amenities that please

Given the industry’s propensity to layer on new products and services that often increase costs for guests, study participants were asked which services they would eliminate to save money — and which they would significantly improve and pay much more for. Members of each generation were unanimous in strongly agreeing to shutter the hotel retail shop and strongly agreed with significantly improving comfortable beds. On the flip side, Millennials and Generation Xers strongly agreed with significantly improving Internet connectivity, while Baby Boomers and Traditionalists strongly agreed with significantly improving hotel employees’ responsiveness.

Engaging guests through their well-being

Though there were slight differences among generations about what drove repeat bookings and what customized services to keep or eliminate, customers’ well-being emerged as a significant driver for engagement across every segment. Yet among all hotel guests studied, just 21% strongly agreed that the hotel they most frequently visit takes care of their well-being. This signifies an enormous missed opportunity for hoteliers. Among guests who strongly agreed that their hotel takes care of their well-being, 79% were fully engaged, compared with 20% who were indifferent and just 1% who were actively disengaged.

Here are some insights hotel brands should consider as they make room to grow:

• Target Gen Xers to build brand loyalty and grow market share. Though Generation X is far smaller than the Millennial cohort, Gen Xers report spending far more money with lower levels of brand attachment than Millennials spend. Gen Xers value reliable services when deciding to return to a hotel, and like Millennials, they place high importance on Internet connectivity.

• Be cautious about assuming that social media and hotel rankings will stimulate revenue. When it comes to selecting a hotel for the first time, social media and industry rankings are at the bottom of the list for all generations. Recommendations from friends have a strong influence on Baby Boomers and Generation Xers, while online guest reviews have the most influence with Millennials.

• Challenge legacy products and services that add cost but not value. In-room bar, valet parking, and bathrobes are considered the least important offerings across all generations. Unlike older generations, Gen Xers and Millennials don’t place value on guest room clocks and radios.

• Reduce price sensitivity and increase loyalty by providing guests with a sense of well-being. This study indicates that guests value a worry-free experience, and they appreciate when hotels anticipate their most important needs. A hotel’s ability to solve problems was highly important for all generations when deciding to return to a hotel. Customers have always anticipated a clean room, a comfortable bed, and responsive employees from a hotel. They still want these things while traveling — along with a reliable Internet connection for their mobile devices.

About the Survey

Results of this study are based on a Gallup Panel Web and mail study completed by 13,515 national adults, aged 18 and older, conducted Dec. 23, 2013 – Jan. 28, 2014. The Gallup Panel is a probability-based longitudinal panel of U.S. adults that are selected using random-digit-dial (RDD) phone interviews that cover landlines and cellphones. Address-based sampling methods are also used to recruit panel members. The Gallup Panel is not an opt-in panel, and members are not given incentives for participating.

The sample for this study was weighted to be demographically representative of the U.S. adult population, using 2012 Current Population Survey figures. For results based on this sample, one can say that the maximum margin of sampling error is +/- 1 percentage points, at the 95% confidence level. Margins of error are higher for subsamples. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error and bias into the findings of public opinion polls.

Source: http://businessjournal.gallup.com/content/173537/hotels-engage-gen-millennial-guests.aspx

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