Implementing Energy Reduction Products to Reduce the Bottom Line

By Amy Bair Career Services Analyst, Florida International University's Chaplin School of Hospitality and Tourism Management | January 19, 2014

What is the focus of hospitality? To delight your guests, yes? What is the focus of the typical business owner. Maximize revenue. Nowadays, there is a trend toward being gentler on Mother Earth too. That can cost money and potentially alienate your guests. How does one balance?

Let us imagine that we can have it all. Sustainability. Maximized revenues. Enchanted guests. Does that sound idyllic? Actually, I believe it is possible.

EnergyStar.gov claims on average, hotels spend approximately 6 percent of operating costs on utilities. This equates to around $2196 per available room. " On a more positive note, a 10 percent reduction in energy consumption would have the same financial effect as increasing the average daily room rate (ADR) by $0.62 in limited-service hotels and by $1.35 in full-service hotels."

Hotels have an enormous opportunity here to not only save money but also do good for the environment and keep guests coming back. Some examples:

  • A 126-unit prestigious condominium complex in Hawaii saved $270,000 annually in energy bills with a ROI of 2 years - by simply installing window film.
  • During a 4-week energy savings test, installing occupancy sensor thermostats in a Florida Hampton Inn resulted in a 51% reduction in runtime and 21% reduction in energy costs.
  • The Marriott La Jolla underwent a major energy conservation overhaul. In one year, the improvements "delivered a 12% year to date savings." An annual savings of $200,000 or 27% is expected once the project is complete. From the US Department of Energy Better Buildings site here.

Where to start? Below are some areas you can look at to reduce energy expenditures. Hotels have been known to save up to hundreds of thousands of dollars per year by implementing some of these products. Guest safety and comfort are not compromised either.

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Sales & Marketing: Selling Experiences

There are innumerable strategies that Hotel Sales and Marketing Directors employ to find, engage and entice guests to their property, and those strategies are constantly evolving. A breakthrough technology, pioneering platform, or even a simple algorithm update can cause new trends to emerge and upend the best laid plans. Sales and marketing departments must remain agile so they can adapt to the ever changing digital landscape. As an example, the popularity of virtual reality is on the rise, as 360 interactive technologies become more mainstream. Chatbots and artificial intelligence are also poised to become the next big things, as they take guest personalization to a whole new level. But one sales and marketing trend that is currently resulting in major benefits for hotels is experiential marketing - the effort to deliver an experience to potential guests. Mainly this is accomplished through the creative use of video and images, and by utilizing what has become known as User Generated Content. By sharing actual personal content (videos and pictures) from satisfied guests who have experienced the delights of a property, prospective guests can more easily imagine themselves having the same experience. Similarly, Hotel Generated Content is equally important. Hotels are more than beds and effective video presentations can tell a compelling story - a story about what makes the hotel appealing and unique. A video walk-through of rooms is essential, as are video tours in different areas of a hotel. The goal is to highlight what makes the property exceptional, but also to show real people having real fun - an experience that prospective guests can have too. The June Hotel Business Review will report on some of these issues and strategies, and examine how some sales and marketing professionals are integrating them into their operations.