The main research question that was studied in the article “Do airport hotels continue to be a growth opportunity, and which airports present the best opportunities?” by Joni Smith was to assess how hotels depend on the local airport to generate demand for their service. There was also a secondary hypothesis investigated studying the link between the premiums charged at average and peak travel times.
The methodology used to address the research questions were questionnaires given to the hotels in the areas of the airports asking for information about occupancy percentages, room rates, and vicinity in relation to the terminals, and other hotel earnings from guests, such as food and beverage sales. Airports were questioned about the number of passengers, number of flights, and original departure and destination sites. This quantitative approach to the study was both appropriate and effective in gaining the information necessary for the research in question.
There were numerous and various findings to the study. One of the more critical findings was that at peak travel periods people will pay a premium for hotel rooms and will pay additional money to have rooms that are located conveniently to the terminals. Even hotels that are slightly closer to the terminals and have slightly better access to the airport can command higher price points. Premium price points will be paid by travelers that are staying at hotels that adjoin the terminals. An additional aspect of this finding is that the busier the airport, the more true this pricing information is. The busier the airports around the world were found to be, in particular in Europe, the more relevant this particular this information appeared to be.
Another fact reported in the article is some of the largest hotel companies were founded by airline companies. Some examples include Pan Am’s InterContinental, Air France’s Le Meridien, and Scandinavian Airline’s Rezidor. These particular hotel chains cater to the airport locations and the air traveler. As such, they build upscale hotels close to the terminals, and expect premium pay, which they have been receiving by travelers willing to pay for the convenience.
Travelers to Europe from the United States are critical to the airport hotel market as they rely on branded hotels for their quality and trust. This is one of the leading reasons that fueled the growth of hotel room growth at the bustling, major airports in Europe. With the economy fluctuating since 9/11, some travelers are unwilling to spend as much money on their lodging as they had in the past and are also trying to trim their travel expenses. As such, there has been an increase in the amount of travelers using secondary city airports. Another part of this increase is due to business travelers also using lower cost carriers to cut expenses. With this influx of travel to smaller airports it will have to be seen how the impact is felt by the major airport vicinity hotels.
If I were conducting the study, there are several things that I would do differently than Smith did in this study. It appeared to be that the main area of focus of this study was on hotels in the European market. It would have been beneficial to have some comparison to hotels and their vicinity to major airports and terminals in the United States, Asian, and Middle Eastern markets as well. This would have enabled the reader to compare the spending patterns of travelers in different regions of the world. Although it may have been impossible to do, it would have been beneficial to have the information available about whether or not people were traveling for business or pleasure incorporated into the data given.
It would be interesting to be able to see if people are more stringent or generous with their own money when traveling and if tis changes when they are traveling abroad from their home country. By following this data for a number of years it could be compared to information about the economy about the home country and how its currency is doing when compared to the foreign country to which one is traveling (Smith, 2004).
The main contribution of this study is the information provided that people are willing to pay a premium to stay in a hotel near or attached to an airport terminal. The closer the hotel is to the terminal, the more it can charge per night and the higher its rate of occupancy at the larger European airports.
Smith, J. (2004). Do airport hotels continue to be a growth opportunity, and which airports present the best opportunities? Journal of Retail and Leisure Property 4(1), 9-17.