By: Elizabeth Olson

Published: August 2, 2010 (New York Times)

 The rewards points given by the big hotel chains have worked out well for business travelers like Michael Burden, a commercial real estate consultant, who uses the points for a family trip or vacation.

“It’s not the sole motivation, but as a family man with young children, a goal is to accumulate enough points to spend with them,” he said. But the down side, he said, is that a room at a chain hotel in one city can feel pretty much like a room at the same chain in another city. “There are times when you can forget where you are.”

That is exactly the sentiment that motivated Jeff Low, who formerly worked for the travel Web site Expedia, and e-commerce veterans of Amazon, Microsoft and Zillow to start a network of independent hotels that gives out points and serves as a counter to the points giants like Marriott, Hilton and Hyatt.

The service, called Stash Hotel Rewards, started in May and has signed up 79 hotels in 63 cities, including Boston, Chicago, Los Angeles, New York, San Francisco, Seattle and Washington. The hotels include boutiques, spas and resorts and are all properties with ratings of three stars and above.

The ratings, Stash’s Web site says, are based on its own assessment of the hotel’s service, amenities, reputation and location. They are also patterned, Mr. Low said, on those of large travel sites like Travelocity and Expedia.

Members of the network include the Hotel Griffon, on the Embarcadero in San Francisco; the Little Palm Island Resort on Little Torch Key, Fla.; and the Sunset Marquis hotel in West Hollywood.

“Travelers said they often felt forced to make a frustrating trade-off,” said Mr. Low, the chief executive of Stash Rewards. “An independent hotel offers a more memorable, personalized guest experience, rather than the same bland room and identical bed in the big-box hotel just to earn points.”

Independent hotels have long sought ways to compete more effectively with their larger brethren, but stark differences in hotel type — properties can range from individual motels at the side of a highway to luxury getaways — hindered efforts. Then, the economic downturn made the need to attract more business more pressing.

At independents, overall occupancy dropped 8.9 percent last year, according to figures from Smith Travel Research. Rates also dropped 9.5 percent for the 22,600 independent hotels last year. Through June of this year, occupancy was up 3.4 percent, but rates were down 1.1 percent, according to the travel industry figures.

The figures were similar so far this year for the top 234 highest end independent hotels, where occupancy rose 4.2 percent, and rates dipped nearly 1 percent.

Banding together in a loyalty points system also became more feasible as computer technology became more affordable.

Having a rewards system is important, said Jan Freitag, vice president for global development at Smith Travel Research.

“All the chains have rewards programs, and they are in an arms race over points,” Mr. Freitag said. “Independent hotels can now say that we’ve got what you’re looking for, and there’s also something in it for you, the traveler.”

Points drive business, said Yogi Hutsen, chief executive for the Coastal Hotel Group, who signed up his hotels for Stash Rewards. “Not giving points has been a drawback for independent hotels. We can now compete head to head.”

The independent hotel points network, operated from Palo Alto, Calif., awards five points for every dollar a customer spends. Points are earned immediately and do not expire. The system has no blackout periods or category restrictions, and travelers sign up free, Mr. Low said.

Under the Stash Rewards system, each hotel sets the price for its room based on availability. A hotel in Florida, for example, would charge more for a room in the peak winter season than in the summer — and a guest member would have to cash in more points to secure a room during high seasons.

The new network charges independent hotels less to obtain guest business than online booking sites, according to independent hotel operators.

Independent hotels pay such sites around 25 percent of the gross amount of the booking, said Eric Horodas, chief executive of Greystone Hotels, which owns and operates independent hotels in San Francisco, Palo Alto, Los Angeles and San Diego. In contrast, Stash Rewards said it charged an average of 7 percent of the room revenue each guest member accumulated.

Online booking sites “have a gigantic market,” Mr. Horodas said. “But I think this independent effort will grow, and the cost of capturing customers will come at a significantly lower cost.”

Mr. Low said he hoped to sign up 200 or more upscale properties by next year.

“We think we’ll soon achieve scale in the U.S. that matches some of the big chains,” Mr. Low said. Those include Hyatt, which has 240 properties, and Starwood, with 500 properties in the United States.

Andy Horrow, an independent marketing consultant from Chicago, who was among the 1,000 people who signed up the first week for the Stash Hotel Rewards program, said in previous jobs he had little choice in hotels because his employers often had deals for corporate rooms.

But business travelers making their own choices, he said, “want to be comfortable, but not the kind of grandma’s quilt comfort, but something hip and young at heart.”

“There are a lot of amazing hotels out there that I want to try,” he said. He also said he saw a beach resort in Naples, Fla., listed on the Stash Rewards Web site, where he would one day take his family with the points he was accumulating.

A version of this article appeared in print on August 3, 2010, on page B4 of the New York edition.

The hotel and lodging industry is making great strides in reducing its environmental footprint. Now it is customary for hotels to offer guests a linen reuse option. Seattle hotels are saving 20-30 percent on waste disposal costs by implementing commercial compost collection programs. Many of the recent, major hospitality industry conferences and quarterly meetings have incorporated issues of sustainability and resource conservation. More and more hotels are responding to the effect climate change concerns are having on travel. Yet, significant opportunities still exist for hotels and lodging companies to save money and save resources.

The following comprehensive list of best practices is meant to inform those looking to achieve more sustainable business practices and enhance their understanding of sustainability in relationship to the hospitality industry and has been compiled from a variety of sources.

 

Kitchen/Restaurant

“The Library Bistro at the Alexis Hotel was able to recycle and compost 85-90% of their waste, saving us about $6500 per year.” Carilyn Platt, Kimpton Hotel Group

- Save 20-30 percent on your business’ waste bills by starting a commercial composting program and donating food to local meal programs.

- Purchase appliances rated efficient by the U.S. government’s Energy Star program.

- Hot food holding cabinets that have earned the Energy Star are 60 percent more energy efficient than standard models. Fryers that have earned the Energy Star are up to 25 percent more energy efficient than standard models. Steam cookers with the Energy Star offer shorter cook times, higher production rate and reduced heat loss due to better insulation and more efficient steam delivery.

Food Steamers

Receive a $1,500 rebate to replace an inefficient food steamer with a new efficient steamer. The rebate, combined with utility savings, should reduce the payback period to two years or less. Spray Heads Replace pre-rinse dishwashing spray heads with more efficient models. A single spray head can use well over $1,000 in water and energy each year. Installing a high efficiency spray head can cut this cost by 40% or more. Every minute you use an efficient head, you save over a gallon of water. Over the course of a year, this can translate into $200 to $900 of cost savings, depending on usage levels and utility rates.

Commercial Dishwasher

A model such as an ENERGY STAR commercial dishwasher can save your hotel an average of $850/year on energy bills and more than $200/year and 52,000 gallons/year from using less water. These models use 25% less water and energy than standard commercial dishwashers. Use a dishwashing system that incorporates a water reuse option.

Commercial Ice Machine

On average, switching to an ENERGY STAR unit can save about 1160 kWh annually, or an average of $100/year on utility bills. In addition to energy savings, a new ice machine will consume less water, the equivalent to saving an additional $10/year and 2700 gallons/ year. Commercial Refrigerator and Freezer You can reduce spending on your existing machine by reducing energy costs and water usage. Buying a unit that meets ENERGY STAR criteria can lead to energy savings of as much as 35% with a 1.3 year payback. By purchasing commercial solid door refrigerators and freezers, buyers can expect to save $170 annually per refrigerator and $120 per freezer. Replacing all existing commercial solid door refrigerators and freezers in the U.S. with ENERGY STAR labeled models would result in savings of almost $250 million per year, or roughly 25% of the energy consumed by models currently on the market – the equivalent of eliminating the emissions from 475,000 cars.

Laundry – Commercial Clothes Washer

When you replace your existing washer with an energy-efficient commercial washer, such as an ENERGY STAR product, your hotel could reduce spending by about $1,200 per washer from your utility bills over 10 years.

- Water reuse and ozone systems can qualify for rebates of up to 50%.

Guest Rooms

- Install energy management systems in guestrooms, meeting rooms and other public spaces.

- Turn off coffee makers, hair dryers and other appliances or personal electronics while guestrooms are unoccupied.

- Use dispensers for amenities instead of single-use disposable bottles.

- Implement a linen and towel reuse program.

- Repair leaky taps and toilets. Implement a preventive maintenance program to catch leaks. Toilet and Urinal Incentives Receive $80 or $120 toward the cost of each low-flow tank or flush valve fixture installed from the FlushStar list.

Seattle Public Utilities also offers free tank toilets to business located in Seattle and Saving Water Partnership areas. There is no limit on quantity. Install faucet aerators in kitchen and bathroom sinks Inexpensive and simple to install, low-flow faucet aerators can reduce your business’ water consumption as much as 50% and reduce your energy cost of heating the water also by as much as 50%. Plumbing You can save as much as 45-60% in energy costs by getting rid of your existing traditional storage tank water heater, and instead using a tankless water heater. Additionally, investing in a tankless water heater could enable you to receive a federal energy tax credit.

Office

- In the office, use both sides of paper when making copies. Make discarded paper into message pads.

- Encourage your suppliers to use less waste. Buy only from those that do so.

- Buy recycled paper goods with a high percentage of post-consumer content for use in guestrooms, kitchen, housekeeping and other areas of the hotel. If possible, purchase goods that are easily biodegradable.

- Implement a recycling program for cans, bottles, cooking oil, phone books, plastic containers, computers, printer/toner cartridges, cardboard, newspaper, plastic and other items. Place recycling containers throughout the hotel, including the guestrooms.

- Shut down office equipment such as photocopiers and computer monitors when not in use.

Meetings

- Offer Carbon Offset programs for your guests and your hotel operations

Green Meeting Packages can include:

- A recycling program

- A linen/towel reuse option that is communicated to guests

- Easy access to public transportation or shuttle services

- Bulk dispensers or reusable containers for beverages, food and condiments

- Reusable plates, glasses, utensils, serving utensils, napkins and tablecloths

- Paperless check-in & check-out for guests

- Use of recycled or recyclable products

- Food sources from local growers or a policy to consider the growing practices of farmers who provide the food

- A policy to use biobased or biodegradable products, including biobased cafeteriaware

Cleaning & Maintenance

- Use green housekeeping practices which include the use of non-toxic cleaning fluids. White vinegar, baking soda, borax, hydrogen peroxide and rubbing alcohol are alternatives. Soda water can be used to clean windows and mirrors. Several companies also offer green cleaning products.

- Reuse condensate – Seattle hotels and hospitals with large heating and hot water requirements may have the opportunity to reuse condensate from steam heat at their facilities. These reclaim systems redirect steam condensate to alternative uses within the facility such as laundry.

- Occupancy sensors, which turn lighting, heating and cooling units on or off based on whether or not a person is present in a room, can reduce energy costs by as much as 50%.

- When purchasing paper towels, toilet paper, etc., look for products that include recycled paper content.

Heating and Cooling

- Improperly maintained air handlers can waste up to 32 percent of the energy they consume. Check HVAC controls for proper calibration.

- Check all electrical systems for loose connections or poor motor conditions. Without proper preventive maintenance, these systems typically generate a 5 to 10 percent energy loss.

- Purchase renewable energy from your local utility.

- Retrofit property with high-efficiency condensing boilers, high-efficiency centrifugal chillers, and low-flow showerheads.

- Install demand-based ventilation systems controls, DDC controls and dry-bulb economizers on air handling units, and VSD’s on room fan coil unit supply fans.

- Light Commercial Heating & Cooling: By using ENERGY STAR® qualified light commercial HVAC equipment, your hotel may use 7-10% less energy than the existing standard equipment.

- Save approximately $3-4 per square foot over the life of the equipment. For example, a 12,000 square foot building using an ENERGY STAR qualified HVAC product could save $36,000 to $48,000.

Lighting

- Switch to CFL light bulbs: Fluorescent bulbs consume approximately 25% of the electricity that an incandescent bulb uses to produce the same amount of light. Fluorescent bulbs last anywhere from 4 to 15 times longer than incandescent bulbs.

- CFLs generate 74% less heat than incandescent bulbs, therefore requiring less air conditioning to cool the same amount of space. Use efficient T5 and T8 fluorescent lamps.

- Properly dispose of fluorescents. They contain a small amount of mercury. Several companies offer safe return container programs.

Green Building/LEED EB

“I believe LEED for Existing Buildings: O&M is a better fit for the hotel industry,” says Marc Heisterkamp, manager, LEED, Corporate & Investment Real Estate for USGBC.

The U.S. Green Building Council (USGBC) has made revisions to its Leadership in energy and Environmental Design (LEED) for Existing Buildings Rating System. Now called LEED for Existing Buildings: Operations & Maintenance (O&M), the system is a better fit for hotels and is attracting the interest of many of the leading hotel companies.

LEED for Existing Buildings: O&M performance standards address issues such as site maintenance, water conservation, indoor air quality, energy saving programs, recycling facilities and programs, purchasing practices, and green cleaning. The standards help provide direction for property managers and operators to cut operation costs and increase efficiency.

Grounds/Landscaping

- Collect rainwater and use it for lawn and landscaping irrigation.

- Use native shrubs and plants, they require less water. Mulching can prevent up to 70 percent of evaporative loss.

- Detect and repair all leaks in your irrigation systems. Make sure the sprinklers are watering the landscaping only – not the street or sidewalk. Water your landscape at night or during the coolest part of the day and install moisture sensors to reduce unnecessary watering.

 Automatic Irrigation Systems – Receive rebates to upgrade irrigation systems components with water saving devices such as controllers/clocks that automatically adjust watering schedules with real-time weather information, rain shut-off devices, and technologies that detect leaks and improve the distribution uniformity of sprinkler-heads. For sprinkler rebates and watering tips, please go to www.savingwater.org. For watering calculators and real-time weather information, please go to www.iwms.org.

Establish a Plan and Promote Success

Conduct a carbon footprint

Operating costs, regulatory uncertainty, shareholder resolutions and consumer expectations are some of the many factors motivating companies to directly confront the climate challenge. Conducting a carbon footprint or greenhouse gas (GHG) inventory is the best way to identify and address carbon emissions. A GHG inventory involves taking stock of all the emissions the organization is responsible for – those that are directly produced (e.g. travel in a company-owned vehicle) and those that are indirectly produced (e.g. employee commute travel). In addition to identifying ways to reduce emissions, hotel operators can partner with a carbon offset organization to offer your guests the option of offsetting their travel. Climate-friendly practices can result in significant cost-savings through increased efficiency and process improvements. With over 60 members, the Seattle Climate Partnership offers assistance and benefits to help employers reduce emissions, improve efficiencies, and successfully compete in a changing environment.

- Put together a written resource conservation plan. Key components should include increased recycling and waste management, water conservation, stormwater management, green building strategies and recycled content, non-toxic supply purchasing. The plan should also include staff involvement and education, facility audits, financial analysis, integrated building upgrades, equipment purchasing, new construction and preventive maintenance.

Sales and Marketing

- Set aside a portion of your room inventory for EcoRooms, PURE rooms, Allergy Friendly Rooms or other similar green room programs that enable you to market your hotel as environmentally friendly.

- Enter awards programs that recognize environmental achievements. Participate in state or national green lodging certification programs. Prominently display membership plaques at the front desk.

- Publish an online booklet that tells your green story and make it available to meeting planners, guests and the media. Create an electronic newsletter to keep your loyal guests and staff up to speed on your green initiatives. Attend green industry events to help get the word out about your hotel. Offer yourself as a potential speaker or panelist for such an event.

- Partner with a carbon offset organization and offer your guests the option of offsetting their travel as well as organizations that plan large meetings at your hotel.

- Resources: Resource Venture: Hospitality News Construction Energy Water Carbon Offsets Resource Venture Green Lodging News Hospitality Design Magazine Green Hotelier US Green Building Council LEED Reference Guides EnergyStar Electronic Product Environmental Assessment Tool (EPEAT) Saving Water Partnership Travel Green TerraPass Carbonfund.org NativeEnergy Consumers’ Guide to Retail Carbon Offsets Providers

BEST PRACTICE: Corporate Hospitality
Author: Alice Johnson

‘I’ll scratch your back if you scratch mine’ and the politics of something for nothing; Alice Johnson investigates why corporate hospitality is no longer just about champagne and caviar

What exactly springs to mind when considering corporate hospitality ñ fancy a pint? Probably not. However, does simply treating your clients to lunchtime drinks fall under the hospitality umbrella? It may be that the only idea many companies have of corporate hospitality is taking 10 of their most respected clients to dinner or booking a hospitality box at a major sporting event. But there’s more to hospitality than plying clients, prospects and journalists with wine and canapÈs, convincing them of your new business strategies whilst at the same time slowly but surely inebriating them.

So what exactly is corporate hospitality, where has it been and where is it going? According to Sarah Webster, communications director at industry trade body Eventia, hospitality is, ìthe form of face-to-face marketing that assists in enhancing the relationship between an organisation and its current and potential customers through interaction in a non-sales environment.î Hospitality has also been described as ‘free entertainment offered by a company to customers or trading partners… as a way of winning their favour’ (Encarta definition). Hospitality is therefore used to ‘enhance’ already existing relationships as well as win the ‘favour’ of those being treated, whether they are existing or prospective clients, suppliers or the media.

This ‘free entertainment’, it seems, can be anything from treating 10 clients to dinner at a local tandoori, to hosting a champagne reception for 300 prospects; from entertaining 200 clients in a hospitality box at Aintree to arranging a celebrity autograph for a client’s son.

However, corporate hospitality isn’t just a sideline about occasionally promoting your business, your brand, your place in the market; it’s now seen by some as an essential part of a B2B marketing spend, and is sometimes even allocated a separate budget entirely.

Hospitality History
Corporate hospitality has changed vastly over the last 10 to 15 years. Historically, it was typically used to treat clients, giving them VIP status for a day or more, and was traditionally held at spectator sports events such as the Grand National at Aintree race course, international rugby games at Twickenham, the Henley Regatta and the Wimbledon tennis championships. Hospitality budget 10 years ago were often not measured, and were the first thing to be cut when times grew tough for a company.

However, it has evolved since then to meet the needs of a changing market and has become more deliverable in terms of return on interest (ROI). Companies started to apply standard business disciplines to their hospitality packages, have begun to identify what was most likely to appeal to the changing sample of clients and understand how this could be strategically used as part of a marketing plan.

Corporate hospitality has changed greatly since its heyday in the 1980s. Heather Westgate, managing director of marcoms agency TDA, comments: ìNowadays it’s hard to justify spending the money without seeing any specific return ñ things have changed massively since hospitality was just seen as a ‘jolly’.î In this respect, the strategy and sense of using a targeted audience is more than obvious.

Andrew Cook, sales director of events company Unmissable, sees this change of market in the context of the influx of women into senior business decision making rules: ìTwelve years ago Kathleen O’Donovan at BTR was one of the only female finance directors. Now, 20 per cent of FTSE companies are female …corporate hospitality has had to adapt to the change in the target market.î This change has involved moving away from more typically male-dominated spectator sports and has grown to incorporate many different branches of the hospitality tree.

Webster of Eventia sees that hospitality hasn’t necessarily changed as such, but has simply ìbroadened out in relation to the target markets that are also broadening.î This, she says, could mean that she is invited, for example, for a spa day at The Sanctuary, rather than being invited to Henley Regatta ñ an event that, with research, a company would realise she wouldn’t like to attend.

The Use of Hospitality
Hospitality is often utilised as a marketing tool, used by companies to deliver messages to clients, prospects and journalists in informal settings. It can prove an ideal vehicle for strengthening existing relationships, forging new ones or simply as a way of rewarding those clients who continually supply your business with their trade.

After all, a business would not be anything without its clients, and the ‘you scratch my back, I’ll scratch yours’ deal is definitely pertinent. Westgate, at TDA, explains: ìThe objective of corporate hospitality is generally to build and cement relationships, so while it will be a social occasion, you do need to plan ahead and take a strategic approach to make sure that both you and your guests benefit.î

In the current economic climate the focus for hospitality is increasingly on generating quantifiable returns from the investment. Cook at Unmissable, concurs: ìSome may view corporate hospitality as a freebie and a big party, but in this economic climate more companies want to see ROI on their hospitality spend by ensuring that their key messages are delivered, they achieve standout from their competitors and gain greater credibility from their clients and staff.î

However, an event that benefits client, prospect and business doesn’t have to involve blatant marketing techniques, or ‘corporate bribery’ as hospitality has sometimes been called. Andrew Colwell, marketing director of LBM, comments: ìCorporate hospitality is definitely part of the strategy from a client-services perspective. It’s not something necessarily used to win new business, it’s a separate entity to develop relationships with existing clients. It’s not necessarily an acquisition tool, but an integrated approach.î

It seems that CH is just as much a way of reinforcing client relations as serving up your company on a plate to prospects. He adds: ìWe don’t use corporate hospitality to win new business, we use it as part of a program to develop existing relationships ñ so a great percentage of those attending corporate hospitality events are existing clients.î

Corporate hospitality is making headway away from its previous champagne and caviar neverending budget days, towards becoming a well-used tool in the marketing industry’s belt.

Getting it Right

So how do you use corporate hospitality successfully? The following tips should prove useful.

1. Understand your objectives

Before selecting an event, or even deciding who to invite, the objectives should be determined, understood and kept in mind throughout. Deciding what you’d like to achieve is paramount. Objectives may include: an increase in sales or motivation, increasing brand awareness, securing new custom or encouraging prospects, encouraging existing customers, or simply saying thank you to loyal customers.

2. Understand and research your audience

Researching the audience (and consequently selecting the function) is vitally important for maximising any kind of return on the organised event. According to Webster of Eventia, ìdoing your homeworkî is the main constituent of gaining anything from the organised hospitality.

3. Choose the right event

An effective hospitality event is one that sticks in the minds of those who attend. Consequently, the heat is on when it comes to sourcing the right place for the right people. Getting it wrong could have drastic consequences for your figures and your reputation; not only dissuading prospects from having anything to do with you, but even discouraging existing clients from continuing an active relationship.

4. Money matters

Hospitality has come a long way ñ from being the first thing to be cut out of a company budget, to being allocated its own budget entirely, as previously mentioned. However, a large budget isn’t necessarily the main constituent of successful hospitality. The effect and impact an event has on a guest is far more important than how much money has been thrown at it ñ a big impact doesn’t necessarily mean big bucks.

5. Spreading the word

Decide what technique you will utilise to invite your selected audience, whether it’s by email, newsletters, word-of-mouth or by posting traditional printed invitations. The way you invite a guest should also be appropriate to the relationship you have with them. For example, if a guest is someone you speak to every week, it may be more appropriate to mention the event during a conversation, rather than simply sending a formal invitation through by mail. The invitation should be seen as the start of the event, so it’s good to make sure the event seems exciting right from the outset. Remember that plenty of notice needs to be given to your audience.

6. Timing is everything

The timing of a hospitality event can prove essential. For instance, holding your event on the same day as several other big industry events is not a great idea. Not only will the chances of your guests actually attending decrease, entering into hospitality ‘wars’ with your competitors could end in the event not being as successful as was first hoped.

It is also wise to consider the general time of year you are to be holding the hospitality. Westgate at TDA, holds hospitality all year round: ìThere are so many parties going on in December that we often organise Christmas events between February and May, when there’s nothing else going on.î Choosing an appropriate time to hold the hospitality can contribute greatly to maximising ROI on the event.

7. Following up

If corporate hospitality is to be used as a specific strategy, it should be followed-up in some way. This could involve gathering feedback from the audience who attended, either informally or by using something as formal as a questionnaire. However, the appropriateness of the technique needs to be considered in relation to how formal or informal the hospitality has been organised throughout.

8. Frequency

Likewise, an event should not just be an annual occasion that proves to be the only contact you have with a client, and hence the only chance of receiving feedback. Westgate, of TDA comments: ìrunning good, regular, transparent reviews with clients is an excellent way to gain feedback, almost on a daily basis ñ you shouldn’t be reliant on a specific event to make sure your clients are happy.î Hospitality, therefore, can be utilised as more of an ongoing review process, rather than a one-off event that needs to be formally measured.