Why Luxury Hotels Are a Bargain

Good morning from Skift. It’s Friday, December 23, and here’s what you need to know about the business of travel today.

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Episode Notes

Luxury hotel companies got a major boost from a post-pandemic surge in demand this year. But they’re missing out on a lot of revenue by failing to charge well-off travelers higher rates, reports Senior Hospitality Editor Sean O’Neill.

Richard Clarke, managing director at Bernstein Research, said luxury hotels should command higher rates, citing the desire among many luxury consumers to spend more money on experiences. Clarke, who presented at the recent Skift Global Forum East in Dubai, stated that luxury hotel companies haven’t seen their market share rise at the same rate as makers of personal luxury goods and luxury cars.

While O’Neill writes some analysts are worried a recession could hurt luxury hotel performance in the next year, Clarke said he doesn’t believe that will be the case. He described luxury spenders as a separate breed, noting their wealth has increased faster than inflation.

Next, United Airlines launched its first major marketing campaign in a decade earlier this year, an effort that represents a new era in branding for the company, reports Contributor Samantha Shankman.

The campaign — titled Good Leads the Way — sees United address themes like pilot diversity, sustainability, and its efforts to enhance customer service. Sixty employees appeared in more than 50 different pieces of video, digital and social media content. United Chief Communications Officer Josh Earnest said the campaign highlights the work its staff has done to help travelers.

Finally, Hollywood star and environmental activist Edward Norton blasted luxury safari operators at a recent tourism conference for large-scale greenwashing, arguing they’re making superficial sustainability commitments. So what steps are companies in the sector taking to ensure they’re truly running their businesses sustainably? Skift reached out to three prominent figures in South Africa’s luxury safari industry to get their answers, reports Travel Experiences Reporter Selene Brophy.

As Norton asserts luxury tour operators need to be sincere about boosting local communities, Glenn Phillips, CEO of the Lapalala Wilderness Reserve, said sustainable tourism should emphasize improving those communities. His reserve is home to the Lapalala Wilderness School, which provides the children the opportunity to learn about nature conservation and zoology over sponsored three-day training camps.

Meanwhile, Russel Bink, CEO of wildlife reserve Tswalu, said more than half of its guest fees go to its conversation component and outreach programs. Bink asserted his goal is to maintain the lowest ratio of guests to space in a privately protected area in South Africa. But he described conservation and restoration as processes with no end goal.