TORONTO — With the summer season fast approaching, hoteliers across the country are cautiously awaiting the return of the traveller. With that in mind, last week, Best Western held its annual Travel Summit in Toronto, hosting a panel of experts, at the Royal Canadian Yacht Club to assess trends in the marketplace and determine what kind of summer hoteliers can expect.
According to Dorothy Dowling, vice-president, marketing, Best Western, “The economy is back. People haven’t gone on a vacation in two years,” she said, pointing out this may be the summer they do so. “Hotel bookings are up by seven per cent but rates are not keeping pace,” she said. Tony Pollard, president of HAC, echoed her sentiments, pointing to statistics that show Canadians are more willing to travel this year but are asking for “more vacation for their money.” While last year’s Travel Intentions Survey, undertaken by HAC, showed Canadians were visiting friends and family, this year’s survey indicates Canadians are more interested in getting back to sightseeing. “This year, they are venturing more,” said Pollard.
Glen MacDonell, director of the AAA, sees the same trend taking hold. “We see great optimism; phones are ringing, and the international market is chugging along,” he said. While the Canadian demand profile is comparable to the U.S., MacDonell pointed out hotel rates in Canada are more depressed. “The U.S. market is seeing a lift in price, so their recovery is different from here.” Pollard noted Canadian rates average between $125 and $127. “That’s insufficient to sustain our operations,” he warned.
While Canadians may be travelling closer to home, despite the positive projections, Pollard says factors such as increasing gas rates, though not presently a hindrance, could become a factor should prices continue to increase. “There is a tipping point,” admitted Dowling, who added “Ninety per cent of our travellers come via cars, from within a 500-mile radius, so it shouldn’t dissuade them from travelling.”
Certainly, other factors that could impact travel this summer include a strong Canadian dollar. But, as Pollard pointed out, “At the end of the day we’re always going to have a travel deficit. The dollar will always have an effect.” He did stress, however, that travel prices serve as a deterrent for both Canadians looking to travel outside the country and for international visitors coming into Canada. “It’s too expensive here,” said Pollard. “Forty per cent of the license plates at the Buffalo airport are from Canada,” he said pointing to the trend of flying to international destinations through American airports.
While Dowling concurred she pointed out that Best Western’s Asian business into North America is up 20 per cent. “That to me is a real opportunity to market to them in a different way.” She pointed to Best Western’s launch of its descriptor strategy as a way to appeal to different consumer profiles. “It helps customers understand what they’re getting,” she said of the new Best Western Plus and Premier designation. “We introduced the program four months ago but already it’s gaining good traction and attracting a lot of interest,” she said. In Canada, the first new Best Western Premier launched in Calgary.
The panellists agreed that, given market conditions, loyalty programs will continue to drive business. “Points are the third currency,” stressed Dowling. “We’ve had 26-per-cent growth in membership,” she added, referring to the company’s loyalty program. “Today’s consumers want to be rewarded for their patronage. We need to maximize value and we do it by providing no blackout periods or point expiration.”