Sustainability initiatives are no longer something that travel companies provide simply to attract more business, instead some progressive travel companies are taking the fight to travellers by instead offering them incentives such as discounts in return for making sustainable travel choices.
For example Hotel chain The Hoxton is the latest in a string of travel suppliers to do so with the launch of ‘The Good Rate’, a new initiative designed to reward guests who choose to travel to its hotels by rail. For anyone embarking on a multi-Hoxton trip in Europe and travelling by rail, the chain will take £20/€20 off the stay in each location, while guests in the US will receive $20 off for travelling to one Hoxton by train.
Meanwhile IHG has for some time now been among several hotel groups that offer restaurant points to guests each time they opt out of a room clean, through its Greener Stay programme.
Clearly though there can be sound business objectives associated with such actions and smart travel companies can use these programs as a means to boost sales & marketing efforts. But how can the industry get onboard with this? Is this just something for travel service suppliers to consider or can B2B distributors and tech providers join in? Are there drawbacks? We asked a range of travel industry experts to find out more.
Siew Hoon Yeoh, founder of travel technology community WebinTravel, thinks the trend is here to stay, and increasingly, travellers will demand sustainable practices from hotels. “In the meantime, it is good for them to be recognised and incentivised. Several hotels in Asia are starting to do this. Ascott has implemented GoGreen in its Discover ASR mobile app, which rewards them with points when they opt to skip room cleaning. Thailand’s Kata Thani Group offers discount vouchers for f&b in-hotel for similar practices. Sukosol Hotels, Thailand, has a special category of rooms called “Hong Pak Rak Loke” ห้องพักรักษ์โลก – which means ‘guest room that loves and protects the earth’ – in two properties, The Sukosol in Bangkok and Siam Bayshore in Pattaya.” Siew Hoon continues “Incentives in exchange for sustainable choices is not entirely new – for example we’ve seen it in other sectors like clean energy and car usage. In travel, it could become more commonplace. Hotels could be in a position to lead this trend as many of them have the flexibility to offer discounts and special offers, particularly to guests who book direct on their website rather than an intermediary.”
Meanwhile Gareth Matthews, Chief Marketing Officer at global travel distribution provider Didatravel says that all hotels should consider this strategy. “It’s a triple win win win tactic for travel suppliers, travellers and the environment. Hotels get extra business from travellers attracted by the discounts while driving their own sustainability goals, travellers get cheaper deals and the satisfaction of having travelled more responsibly, and the environmental impact of travel is reduced. However, there is one challenge though and that is verifying and processing the guest’s claim to have taken the qualifying sustainability measures – there could be people misunderstanding the criteria or even fraud. Thankfully there are automated tools out there for managing this, possibly even as part of the booking process, as you certainly don’t want to be having front-desk staff doing this at check-in.”
Leading hotel revenue management platform BEONx thinks it’s a great idea, but wants to see it taken further. “We need the whole industry to get behind initiatives like this, including to set some standards,” says Chief Marketing & Innovation offices Alex Barros. “At the moment, many travellers want to be sustainable, but not enough to put sustainability over price when booking. If we as an industry can make sustainable options visible more affordable, we might make sustainable choices the norm, and therefore a default for those booking travel in the future. The good news though is that there are travellers out there right now motivated by sustainability when searching for a property and also willing to purchase sustainability related in-destination experiences once at the property – and for them seeing discounts for doing what they were always going to do will attract them even more.
Douglas Quinby, CEO and co-founder at tours, activities and experiences authority Arival, says sustainability has already been a high priority for experience operators, and the drive for sustainability incentives shouldn’t be limited to flights or hotels. “Tour, activity and attraction operators are on the front lines of the intersection among tourism, communities and the environment. Two in three Gen-Z and Millennial travellers are already making choices about what they do, and with whom they do it, based on the impact the activity has on the environment and local community, and they are willing to pay for it. But too many operators underplay their contribution to their destination. Operators must highlight their role local sustainability efforts, supporting local merchants and enabling visitors to make a positive contribution to the community.”
As a final thought, Morgann Lesne from travel investment bank Cambon Partners points out that “already the financial markets in effect offer discounts to companies that meet sustainability criteria, particularly on the debt financing side there are investors with such criteria prepared to offer better terms – but also when it comes to equity fund raising there are many funds out there with very similar mandates and this limits their choices. If you can demonstrate that your business is also obliging its customers to act responsibly in other spheres, well that will push your investment further up the priority list for sure”.