As a frequent flyer living in Toronto, the city’s Pearson International Airport is a routine commute. One of the newer additions to the vicinity’s landscape has been the Alt Hotel logo brightly illuminated atop his modest rectangular rise. Passing this structure on my return drive home via the airport expressway is a constant reminder of this emerging brand and my thoughts on how the hospitality industry will segue from the prowess of baby boomer businesspeople to the millennial traveler.
The Alt Hotel brand is part of a new niche that also includes such soon-to-be-household names as CitizenM, easyHotel and Yotel. Catering almost exclusively to the aptly dubbed “no-frills chic” audience, these brands focus on delivering minimalist product with several nearly universally appealing services, and all for a very competitive rate.
These no-frills brands appear to have sharpened their allure around the few top-of-mind features that matter to young, independent travelers — comfortable beds, quiet rooms, good lighting, a small workspace and free Wi-Fi. Everything else is extraneous. The rapid proliferation of these newer brands within an overall forecast that we’ve long considered stagnant proves there is indeed a market for these stripped-back accommodations, and less really is more.
There are other doodads these hotels incorporate to better differentiate their brands within the budget caste. Limited, multipurpose, ergonomic furniture keeps the small guestrooms from inducing claustrophobia. Self check-in and checkout are mainstays, further expediting mobility. Additional services are regularly 24-hour offerings, such as the common-area lounges and cafés with their rolling fresh food selections or a gym. Lastly, drip pricing is a familiar practice; start with only the most elemental features to qualify as a “night’s stay,” then trickle in everything else a la carte.
Understanding the modern traveler
Young travelers — a key demographic for Alt Hotels — have manifold choices to select precisely where they will stay. Oftentimes, given income constraints, price is the key determinant, and with inexhaustible online resources, it isn’t hard to be scrupulous. By eliminating features to substantially lower the price tag, these hotels streamline the decision on two fronts to further motivate bookings: cheaper rates are easily apparent in any cross-comparison, and fewer features simplify this mental balancing act.
Apart from being self-sufficient, Internet-savvy researchers, this cluster also spends far less physical time in their rooms (an exception being crunch-time computer work). Much like their smartphones, laptops and tablets, these travelers truly are mobile. With 3G/4G services and public Wi-Fi carriers aplenty, the modern traveler has everything they need to stay out and about until the eyelids cave.
The entire conceit of the capsule hotel is that the guestroom — or guest-closet, as might be more appropriate — is designed for sleep and not lavish vacationing, entertaining, introspective soul-seeking or pampered rejuvenation. You sleep, you wake, you get ready and then you hit the road. In Tokyo, where capsule hotels have long made their mark, it isn’t uncommon for a weary worker burning the midnight oil to rent such a room instead of journeying all the way home. Capsule hotels are typically far closer to the office, and for the convenience of purging the commute times, they are well worth the price.
More notes on the no-frills chic success story
To state the obvious, the binding force of all these progressions is the Internet. It’s an essential service, and obtaining it for free is a cardinal demand of the modern traveler, both for business and leisure. These contemporary brands thrive in large part from their simplicity — one easy bill that includes Wi-Fi with no surcharges.
The modern traveler doesn’t care about your rationale for charging for Wi-Fi; all they see is a big, separate bill for Internet connectivity, and it frustrates them — sometimes enough to deter a return visit. Not offering free Wi-Fi is a great tactic for disenfranchising the next generation of consumers. No-frills means no hassle. And this straightforward approach translates to many other important considerations — too much clutter in the rooms, in-room amenities that add cost and aren’t vital and property services that are habitually underutilized.
Mind you, we are talking economy class, and consumer behavior changes dramatically as we move up the stratosphere. No-frills chic hotels get by primarily on their price and the services they deem as indispensable, therein drawing a certain type of traveler — commuters, layovers, transient workers, young urban tourists, backpackers and anyone who just needs a quick snooze. For this archetype of traveler, hotels are commodities with situational convenience and competitive rate trumping loyalty to any one particular chain. Luxury is a different ball game.
No-frills chic is not without its drawbacks. Self check-in and checkout are fundamental points of human interaction from guest to staff. Psychologically speaking, their absence removes a critical point of “brand imprinting” on the consumer as well as an opportunity to promote amenities, alleviate concerns or garner feedback. The sparse décor also operates in much the same way; nothing in the clinical furnishings elicits a strong emotional response. Ditto for the stark lobbies; grand first impressions aren’t likely, nor are they a company priority. Contextually, these are all conscious tradeoffs to keep prices down and fit the needs of their target market.
Now think of your hotel
So, what’s your core appeal? What’s your primary demographic? Really narrow it down. If it’s harried business travelers and sightseeing tourists between the ages of 18 and 30, you’re in for an uphill battle, as these no-frills chic abodes have already plucked prime real estate and packed each location with enough sardine-sized rooms so that the low-cost, high-occupancy model is actually viable. However, there are dozens of other theaters of war yearning for a revamp that better appeals to the modern traveler.