College Campus Hotels for the 21st Century

An "Old" Hotel Type Gets a New Twist

By Paul Breslin Managing Director, Horwath HTL | December 11, 2016

Co-authored by Oliver Tang, Analyst, Horwath HTL

Generally, any hotel that uses a nearby educational institution as the primary demand generator can be considered a campus hotel; however, the scope of this article focuses on hotels that are directly affiliated with an educational institution, often a college or university.For each campus hotel project, developers should fully understand the school's vision to create a property that not only meets the design requirements and educational purposes, but is also economically sustainable. On the other hand, operators should have appropriate revenue management practice, leverage school's internal resources, and manage student employees with extra emphasis on scheduling and training.

The concept of campus hotels is not a new one. In 1923, the American Hotel Association proposed a "practice hotel" for Cornell's then newly-established hospitality program. For many years, because there are only a limited number of this kind of properties, there has not been significant study on this topic. However, in recent years, the industry has seen increasingly more joint ventures or other types of partnerships between educational institutions and developers all around the country. There are several reasons that contributed to this trend:

  • The boutique lifestyle hotel movement in the hospitality industry requires
    many older campus hotels to be renovated or upgraded.
  • More and more universities and colleges started offering or expanding their
    hospitality programs, and having a hotel can add practical value to these
    programs.

The hospitality industry is becoming more segmented in terms of branding, product offering and affiliated demand generators, and special considerations are required for the development and operation of each type. Corresponding to this need, the industry boasts developers who solely focus on campus hotels. For example, a Chicago based hotel chain, Graduate Hotels, has been developing college-themed hotels since 2014. SMART hotels, a hotel development company based in Cleveland, started their campus hotel specific development service in 2010.

Many educational institutions perceive their campus hotels much more than just a lodging facility; most campus hotels are considered an integral part of the school or program. Schools not only utilize these hotels in the traditional manner, but also use them to provide hands-on working experience for hospitality students. In some cases, the campus hotels have even become the activity and social center of the campus.

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Social Media: Getting Personal

There Social media platforms have revolutionized the hotel industry. Popular sites such as Facebook, Twitter, Pinterest, Instagram, Snapchat, YouTube and Tumblr now account for 2.3 billion active users, and this phenomenon has forever transformed how businesses interact with consumers. Given that social media allows for two-way communication between businesses and consumers, the emphasis of any marketing strategy must be to positively and personally engage the customer, and there are innumerable ways to accomplish that goal. One popular strategy is to encourage hotel guests to create their own personal content - typically videos and photos -which can be shared via their personal social media networks, reaching a sizeable audience. In addition, geo-locational tags and brand hashtags can be embedded in such posts which allow them to be found via metadata searches, substantially enlarging their scope. Influencer marketing is another prevalent social media strategy. Some hotels are paying popular social media stars and bloggers to endorse their brand on social media platforms. These kinds of endorsements generally elicit a strong response because the influencers are perceived as being trustworthy by their followers, and because an influencer's followers are likely to share similar psychographic and demographic traits. Travel review sites have also become vitally important in reputation management. Travelers consistently use social media to express pleasure or frustration about their guest experiences, so it is essential that every review be attended to personally. Assuming the responsibility to address and correct customer service concerns quickly is a way to mitigate complaints and to build brand loyalty. Plus, whether reviews are favorable or unfavorable, they are a vital source of information to managers about a hotel's operational performance.  The February Hotel Business Review will document what some hotels are doing to effectively incorporate social media strategies into their businesses.