Here Come the Kid$

By Bonnie Knutson Professor, The School of Hospitality Business/MSU | July 17, 2016

When most of us were youngsters, the notion of children having much say in what our parents did, what they bought, or where the family stayed when it went on vacation was in the realm of comedian Rodney Dangerfield. They got no respect. Now, kids are – or should be – on virtually every brand's radar screen. Overall social and cultural trends have bolstered kids' monetary muscle. Consider the dramatic rise in their purchase power.

Back in the 1960s, children influenced about $5 billion in family purchases. These were the days of children being seen but not heard. Their primary tool of influence was what my parents called "nagging." We called it wearing them down. By the 1980s, parents began to involve their children more in family decisions so their influence power jumped to more than $50 billion. Today, try going out to grab a bite to eat or deciding whether to go to a theme park, dude ranch or stay in a historic hotel in a big city without talking with your kids and you' can be doomed to a really bumpy vacation.

Today's family is an inclusive family, with parents empowering and encouraging their kids to be involved in decisions across the board. If hotels have not yet realized the potential of this market trend, business sure has. Companies spend more than $1.2 Trillion (That's with a "T"!) annually marketing to children because they represent a dynamic retail market, influencing an estimated $500 billion in total retail spending. Marketing to children has evolved from the initial days of "secret decoder rings" and Cracker Jack toys. Today, kids are considered to be customers in their own right. Ask Disney. Ask Noggin.com.

Ask McDonald's, Nike, or True Jeans. They represent an important demographic to marketers because they have their own money, they influence what their parents do, where they go, where they stay, and what they buy. Plus they are the adult consumers of the future. Trends such as smaller family size, multi-generational families, dual incomes and postponing having children until later in life mean that parents (and grandparents alike) have more disposable income and are willing to spend more for and on their kids. Add to this the role guilt can play because parents are time-stressed and you have a potential gold mine for your hotel. Sound familiar?

YouGov research found that children are "active decision makers in family economies" across a lot of decisions – including travel. They also found that young children can hold as much persuasive power as teens. From a young age, children's preferences influence where the family goes and where the family stays 87% of the time. And this is true across geographic markets too. No matter where you live in Europe or the U.S., for instance, the vast majority of parents give their children some say in deciding where they want to go on a trip, whether for a weekend getaway or a more traditional family vacation.

Interestingly, in the U.S. about 71% of parents say they ask for their kids' input, but this jumps to 94% internationally. So just where are your guests coming from? Parents view kids' input as a way to ensure that their children get more out of the family's travel experiences. And it's also a way to reduce the nagging quotient too. As Brian Sharples, HomeAway CEO, quipped, "The whole family is now invested in the experience, with kids bringing their own travel preferences to the table." Parents are listening. So are hotels, resorts, spas, cruise ships, Airbnbs, and Bed & Breakfasts. Are you?

Choose a Social Network!

The social network you are looking for is not available.

Close
Coming up in May 2019...

Eco-Friendly Practices: Corporate Social Responsibility

The hotel industry has undertaken a long-term effort to build more responsible and socially conscious businesses. What began with small efforts to reduce waste - such as paperless checkouts and refillable soap dispensers - has evolved into an international movement toward implementing sustainable development practices. In addition to establishing themselves as good corporate citizens, adopting eco-friendly practices is sound business for hotels. According to a recent report from Deloitte, 95% of business travelers believe the hotel industry should be undertaking “green” initiatives, and Millennials are twice as likely to support brands with strong management of environmental and social issues. Given these conclusions, hotels are continuing to innovate in the areas of environmental sustainability. For example, one leading hotel chain has designed special elevators that collect kinetic energy from the moving lift and in the process, they have reduced their energy consumption by 50%  over conventional elevators. Also, they installed an advanced air conditioning system which employs a magnetic mechanical system that makes them more energy efficient. Other hotels are installing Intelligent Building Systems which monitor and control temperatures in rooms, common areas and swimming pools, as well as ventilation and cold water systems. Some hotels are installing Electric Vehicle charging stations, planting rooftop gardens, implementing stringent recycling programs, and insisting on the use of biodegradable materials. Another trend is the creation of Green Teams within a hotel's operation that are tasked to implement earth-friendly practices and manage budgets for green projects. Some hotels have even gone so far as to curtail or eliminate room service, believing that keeping the kitchen open 24/7 isn't terribly sustainable. The May issue of the Hotel Business Review will document what some hotels are doing to integrate sustainable practices into their operations and how they are benefiting from them.