The Importance of Location in The Hospitality Industry

Customers choose hotels that suit their needs best, even if this requires certain compromises. Some customers value location above everything else and are willing to pay that little bit extra; some put a greater emphasis on facilities offered by the hotel itself and place less value on its surrounding amenities; and others may have chosen the hotel specifically to attend nearby events.

“It is elementary…”

If the hospitality industry can identify key customer motives in relation to location, it is possible to use this information to target new audiences.

A hotel may realise that a proportion of its rooms is booked because of its vicinity to a conference centre; this knowledge can be used to target people attending other events at the same conference centre, for example by advertising in collaboration with the conference centre and placing ads in their events brochures. The hotel can adapt its rates and offers based on the inflexibility of dates on the side of the customer. It may also find that despite its location, guests prefer to stay in a competing hotel further away; understanding the motivations behind this will allow the hotel to re-consider it offerings and adapt their services accordingly.

Identifying ‘proto-type’ customers in a range of different areas can be very useful to a hotel chain that is seeking to expand; understanding what a potential location has to offer to the staying guest will allow the hotel to target the ‘right’ audience from the outset – thus achieving higher booking numbers and increased profit margins from the start.

Briefly put, customer insight and location analytics are very useful means for the hospitality industry to understand the importance of location, customer reasoning, and assures with greater certainty a positive outcome to any returns in investment.