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Room with a (long-term) View: ​When to book extended-stay

November 30, 2018


By Scott Brennan
Chief Growth Officer, RoomIt by CWT

Home sweet home: Extended-stay properties offer home comfort and lower ADR

Extended-stay properties are sprouting up with increased regularity. It feels as if sharing economy and apartment properties receive daily attention, and traveler demand appears to be keeping pace. Travel buyers have certainly taken notice too, as 94% believe they will have to allow more flexibility, or maintain current levels of flexibility for extended-stays and for alternative lodgings.

Only about 10% of business travel bookings are for stays longer than 5 days, a trend that has remained relatively stagnant for years. So why the growing interest?

Here are 5 reasons extended-stays and apartments may be worth considering regardless of a traveler’s length of stay.

  1. Increased availability

    For one thing, extended-stay and apartment content can improve availability. If a traveler is booking accommodations in a city experiencing sell-out conditions, the allowance of additional lodging types can only increase the chance to stay within budget. This is also true for travelers going to markets with fewer hotel options.

    Since location remains the highest determinate of why business travelers book particular accommodations, interest in non-traditional accommodation types in major markets is growing as well.

    For example, Chicago has a high concentration of traditional hotels in its downtown areas, yet major companies, such as McDonalds and Google, have opened offices in newer, trendy neighborhoods. If a traveler wants to stay nearby and the limited traditional hotel inventory is sold out, some travelers would rather book alternative accommodations in these neighborhoods than suffer a longer commute to the meeting from a hotel farther afield.

  2. Reduced average daily rate

    If you have a goal of reducing travel costs, the average daily rate (ADR) of extended-stays may be worth investigating. In 2017, lower-tier extended-stay properties had a $69 ADR in the US. Compare this with the overall US ADR in 2017 of $126.72. Interestingly many of these properties don't have a minimum night stay.

  3. Improved traveler satisfaction

    89% of travelers surveyed by extended Stay America said they would rather cook in a hotel kitchen as opposed to eating out if given the chance. For some, eating in provides more ease and comfort when away from friends and family.

    92% of travelers in the same survey felt home cooked meals are healthier than eating out. This should come as no surprise. What it means for travel managers, however, is if they have a goal of improving traveler satisfaction, providing healthy travel options is pivotal. Therefore, allowing and promoting the benefits of extended-stay accommodations can go a long way in making travelers happy.

  4. Reduced out-of-pocket costs

    Staying within per diem limits and understanding what can be expensed brings anxiety to many business travelers. Companies often set blanket per diems that may not appropriately account for disparate cost of living among cities, which means travelers may end up paying for some of their meals out of pocket. Simply having access to a full kitchen gives travelers more opportunity to stay within spending limits.

  5. Less out-of-program bookings

    Empowering travelers with a variety of choice is vital in the pursuit of greater hotel program compliance. Travel programs that restrict alternative lodgings or extended-stay bookings are often working against travelers who willingly go outside corporate channels in search of these properties. Why do travelers do this?

    Whether a traveler is on a contract, training or even relocating, it may be difficult for them to find a property that is available for the entirety of their lengthy stay. When booking, travelers need to hope that one night out of their entire stay at a traditional hotel isn’t sold-out, otherwise that hotel will be completely unavailable. This can push travelers outside your booking tools in search of accommodations that tend to take bookings for extended periods of time. If your policy is more restrictive, it may be time to readdress this topic considering the fact that 60% of travelers are untracked when they book direct.

Greater flexibility in extended-stay accommodations seem to be on the horizon. Major hotel brands are entering the alternative lodging space and increasing their extended stay brand footprints. It’s important to familiarize yourself with their benefits and equip your travelers with the right tools for finding and booking these properties.


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