Chapter 1-1. Overview of the Hotel Industry
Summary
TLDRThis script offers an in-depth introduction to the hospitality industry, encompassing lodging, transportation, food services, and event planning. It highlights the importance of guest experience, safety, cleanliness, and service. The lodging industry's characteristics, including perishability and labor intensity, are discussed. The classification of hotels by size, market segments, location, and ownership is explored, with examples of major hotel companies like Marriott International and Hilton, emphasizing their diverse brand portfolios and global presence.
Takeaways
- π¨ The hospitality industry is a broad service sector encompassing lodging, transportation, food and beverage, event planning, theme parks, and cruise lines, all aiming to provide enjoyable experiences to customers.
- ποΈ Hospitality is defined as the relationship between a guest and a host, characterized by the host's goodwill in receiving guests, which can include receptions, entertainment, and generous reception.
- π° The term 'hotel' originates from French words for noblemen's residences or large official buildings and is an establishment offering sleeping and living accommodations to travelers.
- π Lodging industry characteristics include a focus on safety, cleanliness, and services, aiming to make guests feel at home with a sense of security and care.
- β³ The industry is characterized by perishability, meaning if rooms or food aren't sold on a given day, they are lost, necessitating daily availability and readiness.
- π The industry is labor-intensive, often involving repetitive tasks such as housekeeping and front desk operations, yet it remains dynamic due to the variety of guests encountered.
- π’ Hotels can be classified by size, ranging from small (under 115 rooms) to large (over 600 rooms), with mid-size hotels falling in between.
- π― Market segments classify hotels into categories like economy, mid-scale, upper mid-scale, upscale, upper upscale, and luxury, with brands like Ritz Carlton and Four Seasons representing the luxury segment.
- π Hotels can also be classified by target markets, such as business hotels near business districts, resort hotels chosen for vacations, and extended stay hotels designed for longer stays with additional amenities.
- π Geographic location is another way to classify hotels, with distinctions made between suburban, metropolitan, and other areas, as well as global regions like Americas, Europe, Middle East, Africa, and Asia Pacific.
- π€ Hotel ownership and affiliations can be independent, part of a franchise agreement, under a management contract, or part of membership groups, each with its advantages and challenges.
Q & A
What is the hospitality industry?
-The hospitality industry is a broad category within the service industry that includes lodging operations such as hotels, transportation services like airlines or trains, food and beverage operations such as restaurants and bars, event planning for corporate events or weddings, theme parks, and cruise lines.
What is the primary goal of the hospitality industry?
-The primary goal of the hospitality industry is to provide customers with enjoyable experiences, which can range from a good meal to a relaxing spa visit or a comfortable night's rest away from home.
What does the term 'hospitality' refer to in the context of the industry?
-In the context of the industry, hospitality refers to the relationship between a guest and a host, where the host receives the guests with goodwill, including receptions or entertainment for visitors or strangers.
What is the origin of the word 'hotel'?
-The word 'hotel' comes from the French word for the noblemen's residences, townhomes, or large official buildings.
What are the key characteristics of the lodging industry?
-The key characteristics of the lodging industry include emphasis on safety, cleanliness, and services, providing guests with a sense of being at home while away from home.
What is the term used to describe the nature of service industry products?
-The term 'perishability' is used to describe the nature of service industry products, which means if the product, such as a hotel room or a meal, is not sold at that moment, it disappears and cannot be sold later.
How is the hospitality industry characterized in terms of labor?
-The hospitality industry is characterized as labor-intensive, which often results in high turnover rates.
What are the four main ways to classify hotels?
-Hotels can be classified by size, level of service or market segments, locations, and ownerships and affiliations.
What does STR stand for and how does it classify hotel segments?
-STR stands for Travel Research, and it classifies hotel segments into six categories: economy or budget, mid-scale, upper mid-scale, upscale, upper upscale, and luxury.
What are the different types of hotel target markets mentioned in the script?
-The different types of hotel target markets mentioned include business hotels, resort hotels, conference hotels, boutique hotels, extended stay hotels, bed and breakfast hotels, and casinos.
What is the largest hotel company in the world according to the script?
-According to the script, Marriott International is the largest hotel company in the world.
What are the benefits and pitfalls of being an independent hotel?
-The benefits of being an independent hotel include running the hotel with minimum costs without paying franchise fees. The pitfalls include difficulty in promoting the hotel to the market due to lack of a well-known brand name.
What are the types of agreements or affiliations that a hotel can have?
-A hotel can have a franchise agreement, a management contract, or be part of a membership group. Each has its own benefits and responsibilities, such as brand recognition, operational support, and fees.
What are some examples of major hotel companies mentioned in the script?
-Some examples of major hotel companies mentioned include Marriott International, Hilton, InterContinental Hotels Group (IHG), Accor Hotels, and Wyndham.
Outlines
π¨ Overview of the Hospitality Industry
The hospitality industry is a diverse sector within the service industry that encompasses lodging, transportation, food and beverage operations, event planning, and theme parks or cruise lines. It aims to provide customers with enjoyable experiences, emphasizing the importance of guest care. The script introduces the concept of hospitality as a relationship between a guest and a host, highlighting the need for goodwill and generous reception. Hotels, as part of this industry, are establishments offering sleeping and living accommodations to travelers, with a focus on safety, cleanliness, and services to make guests feel at home. The lodging industry's characteristics include perishability, where unsold services like rooms or meals are lost, and labor intensity, which contributes to high turnover rates.
π Classification of Hotels Based on Size and Market Segments
Hotels can be categorized by size, ranging from small hotels with under 115 rooms to large hotels with over 600 rooms. Additionally, market segments defined by STR include economy, mid-scale, upper mid-scale, upscale, upper upscale, and luxury. The script lists examples of hotel brands for each segment, such as Ritz Carlton for luxury and Motel 6 for economy. It also discusses hotel rating systems like AAA's diamond ratings and the star system from Forbes. The paragraph further elaborates on different target markets for hotels, such as business, resort, extended stay, bed and breakfast, and casino hotels, each with unique features and services tailored to their clientele.
π Hotel Classification by Location and Ownership
Geographical location plays a significant role in hotel classification, with distinctions made between American areas, Europe, the Middle East and Africa, and the Asia Pacific region. The script also touches on the classification of hotels by ownership and affiliations, including independent hotels, franchise agreements, management contracts, and membership groups. Independent hotels have the freedom to operate without brand restrictions but face challenges in market promotion. Franchise agreements and management contracts offer brand recognition and operational support at the cost of fees. Membership groups, such as Best Western, provide collective marketing benefits for independent hotels.
π’ Major Hotel Companies and Their Brand Portfolios
The script introduces some of the largest hotel companies in the world, such as Marriott International, which has a diverse portfolio of 30 brands and over 7,000 properties. It also mentions other major players like Hilton, Hyatt, IHG, Accor, and Wyndham, each with their own range of brands catering to different market segments from luxury to budget. The companies' brand portfolios are described, showcasing their presence across various service levels, from premium and luxury to mid-scale and budget options. The paragraph highlights the global reach and influence of these companies in the hospitality industry.
π Revenue and Market Presence of Leading Hotel Chains
The final paragraph focuses on the financial success and market dominance of leading hotel chains, particularly Marriott, which is noted for its significant sales revenue. The script emphasizes the importance of understanding the different business models and strategies employed by these companies to maintain their competitive edge in the global hospitality market. It also underscores the growth and expansion of these hotel chains, reflecting the dynamic nature of the industry and the continuous demand for diverse hospitality services.
Mindmap
Keywords
π‘Hospitality Industry
π‘Lodging Industry
π‘Perishability
π‘Labor Intensive
π‘Market Segments
π‘Extended Stay Hotels
π‘Bed and Breakfast (B&B)
π‘Casino Hotels
π‘Hotel Classification by Size
π‘Ownership and Affiliations
π‘Hotel Companies
Highlights
The hospitality industry is a broad service sector encompassing lodging, transportation, food and beverage operations, event planning, theme parks, and cruise lines.
Hospitality involves the relationship between a guest and a host, characterized by goodwill and generous reception.
A hotel is an establishment providing sleeping and living accommodations to travelers, emphasizing safety, cleanliness, and service.
The lodging industry is characterized by perishability, requiring daily room availability and maximizing occupancy.
The service industry, including lodging, is labor-intensive, often facing high turnover rates.
Hotels can be classified by size, ranging from small hotels with under 115 rooms to large hotels with over 600 rooms.
Market segments classify hotels into economy, mid-scale, upper mid-scale, upscale, upper upscale, and luxury categories.
Hotel brands like Ritz Carlton, Four Seasons, and St. Regis are recognized as high-rated luxury segments.
Target markets for hotels include business, resort, conference, budget, extended stay, and bed and breakfast.
Geographical locations influence hotel classifications, with distinctions made between urban, suburban, and rural areas.
Ownership and affiliations categorize hotels as independent, franchised, under a management contract, or part of a membership group.
Independent hotels have the freedom to operate without brand restrictions but may struggle with market promotion.
Franchise agreements allow hotels to use a famous brand name but require franchise fees.
Management contracts provide operational support and ensure efficiency but involve contract fees.
Major hotel companies like Marriott International, Hilton, IHG, and Accor have diverse brand portfolios catering to various market segments.
Marriott International is the largest hotel company globally, with 30 brands and over 7,000 properties.
Hotel companies like Wyndham and Choice Hotels focus on mid-scale, budget, and economy brands.
The transcript provides a comprehensive overview of the hotel industry, its classifications, and major players.
Transcripts
[Music]
hello everyone welcome to chapter one
overview of the hotel industry
so what is the hospital industry
hospitality industry is a
broad category of fields within a
service industry
that includes
lodging operations such as hotel
transportation services such as
airlines or trains or food and beverage
operations
such as restaurant and bar
event plannings
planning for
corporate events or weddings
or theme parks such as disney or cruise
lines such as cruise ships
the hospital industry provides customers
with enjoyable experiences whether
that enjoyment comes from eating a good
meal
relaxing in a luxurious spa or getting a
good night's rest away from home
making sure each individual guest
is taken care of is such a paramount
[Music]
advice hotel operations
the first we're going to think about
what
hospitality means
hospitality is the relationship between
a guest and host
wherein the host
receives the guests with some amount of
goodwill
including such as like receptions or
entertainment of cast visitors or even
strangers so
in a dictionary term a hospital is the
uncourtier sincere and
generous reception of guests a hotel is
part of the hospitality
businesses
which
comes from the french word hotel
for the noblemen's residents townhomes
or large official buildings
hotel is an established establishment
that provides away from home sleeping
and living accommodations to
friendships travelers for daily
enumerations or even
grief travelers
family and so on
lodging industry
characteristics includes
the emphasis on safety cleanings and
services
think about
your guests
is staying your hotel away from home but
they want to feel like they're in the
home
so it should provide them with a sense
of safety
cleanness and
service as well
and our field not only the lodging
industry whether it's a service industry
in general
it's impossible to separate
manufacturing your products and selling
your products so we do both things at
the same time we make the food and then
provide that food to the guests at the
same time
the perishability is also
a key terms when it comes to
lodging in the serious characteristics
because if you don't sell to your
products such as your room or the papers
in the restaurant today
or at this moment it just disappears so
the hotels have to make sure that
the rooms are available every day
the guests to
increase or even maximize their
readiness
our industry also has some sort of
repetitiveness characteristics
when it comes to housekeeping
they clean the same room every day
when it comes to front desk their job is
somewhat liquidity
the restaurant is also some other period
whether
serving the food or culling the dishes
but
what makes our industries different is
that your guests are not
seen
so even though your work is about
repetitive
but it makes you feel like you're
in the like a live environment because
you meet
different people every day
it's hard to deny that our industry
is about labor intensive
that's why
the logic industry has
issues with high term level rates
[Music]
now we are going to
classify hotels by four categories
by size of the hotels by the level of
service in other words market segments
by locations and by
ownerships and affiliations
you can classify the hotel based on the
size of its hotels
when it comes to
small size of hotel usually room under
the hotel that has room under 115
is considered
the small size of hotels
the hotel that has over 115
to
600
it's somewhat in the middle of between
like middle size or medium size
or just normal size of breakdowns
the usually the hotels that had
room over 600 rooms
uh it's considered a large size of
hotels but here on the right side you
can see the average number of rooms per
repairs
in the united states
[Music]
you can also classify the hotel by
market segments so this segment which
includes six categories
is
defined by str which is travel research
they
have classified the voters by
six segments including economy or budget
mid scale upper mid scale upscale
upward upscale or
the luxury
so luxury segments
include brands such as woods carton
four seasons or dolph australia
or saint regis
up pop scales like such a westin
renaissance were hired
upscales
mario 3
upper mid scale
holiday inn la moda
miss skills like some of the best in
best westerns or queensland economy or
projects project hotels mostly like a
motel segment
econo large motel 6 or micro pail super
8
so this is the chart indicating uh
highest rated luxury hotel brands in
north america as of may 19th
as you can see the rich carton is
the brand that is higher rated luxury
brand hotel
in america
other companies such as
triple diamonds
or
orbs
they also provide
a hotel rating
systems
based on their definitions so
great they use the diamond to
find hotel segments from basic
luxury the start system from folks also
have five stars
from economy
to village
you also classify the hotel by target
markets
the business hotel which is just mainly
located near the business district of
that regions
focused primarily on business people
and
this obviously is the largest will
hotels reserved hotels are open chosen
as destinations or vacation spots
obviously for your
uh the vacations
also features
recreational facilities or activities
and even
breathtaking sceneries
like i said
the lizard hotel targets leader
travelers
extended stay hotel is designed for
travelers who stay five nights or longer
which provides online atmospheres
differences between normal hotel and
extensive hotel is that in the extended
state hotel
it provides additional
equipment
or facilities
or amenities
such as
kitchens
in the room or
like refrigerators in the rooms
or
laundry rooms in the hotels
[Music]
or extended
provisional
meals
and the amenities
one more thing is that
a bed and breakfast hotel
so simply
the accommodations facilities that
provides bad breakfast
simply we call it bnbs
most of only offer lodging and limited
food service which is breakfast room
rates tend to be lower than the first
service hotel because they are providing
uh limited services
or even you have casinos featuring
gambling facilities las vegas is one of
the
great examples in asia macau is one of
great examples too
you can also classify the hotel by
locations
this is the americans map right you can
see uh the pacific area mountaineer west
north adventure west centre or even new
england south athletes so on
when it comes to the world
you can divide
this world based on four areas which is
american areas
and europe
mid-east and africa
and asia pacific
so based on the locations
the suburban area has most
uh hotels in that area
because that has lots of lizards
or
motors for
the rotary
peoples and so on
and over and areas and small metro also
has
um hotels
as well
you can also classify the hotel
by ownership and affiliations
independent hotel is
the hotel that is independently on
denver
this
type of hotel doesn't allow any other
proprietors
to use its name or brands
overtime italian loving is one of the
examples that you can think about
as independent repairs has lots of
benefits
you know
you can run your hotel with minimum
amount of
costs
you don't have to pay for
franchise fees or amazement fees
however
as independent hotel one of the biggest
pitfalls is that it's really hard to
promote your hotels to
the markets
[Music]
the other one is the franchise agreement
you just
borrow
some famous hotel brands
name to your hotels
this is a formal license of different
source flow
targets on the branding a little or even
no involvement in the operations
obviously it's easy to
promote your hotel because people know
their brand's name
but at the same time you have to pay for
defensive speed
the management contract is a service
contract which means by the contract
which comes with arrangement of all
functions such as
technical operations
personnel
management accounting surgical marketing
even training
as an owner they don't have to worry
about how to operate the day-to-day
businesses
but again
they have to pay for the mainstream
contract fees
the the management contract
like i just said uh they manage
the daily uh operations of a hotel they
also ensure that hotel is managed
effectively and
efficiently days
sometimes they own their own hotels but
they do not always own the physical
accounts the remington cortex company is
one of the um
example of
management company
[Music]
you can also think about different
groups just
work as
based on membership groups this is a
group of independent hotels that have
banded together for their common goals
so tell us within that group before they
are departing guests or those guests
that they cannot accommodate
to other properties
that refer groups
the best western is one of the examples
of liquor
groups
so
here's the chart
when owners
want to
build
their hotels in their land
they
may have to think about whether they are
going to have chain brands such as
marion here in hyatt
or
just operate hotel and just independent
hotel
if they want to do
main independent hotel
they have to decide whether they want to
operate their business by themselves
or
have a contract web management company
to
let them you know
operate their businesses on behalf of
them
or when it comes to chain hotels
they always have to decide whether they
are going to run the businesses by
themselves
or have the management contract
so you can have the management contract
with
your franchisor
or
amazement companies
[Music]
so you can also lastly classify military
by company and friends so i'm going to
introduce
some of major hotel companies
in america as well as in the world
maria international
is
the biggest total company group
in this world
which is an american multinational
diversified military company
founded by john lillard marion and back
in 1927
currently they have
30 brands
with over 7 000 properties
to sort of the world
this is their brands
in their luxury line
which carton is part of the marriott
the luxury collections sandwiches w jw
marriott and edison i'm sorry edition
is their luxury line premium nine
in other words up up scale or upscale
includes
uh sharon's
westin or libations
renaissance
and so on
select someone in the middle of like mid
scale or upscale
courtyard
four points spring and sweets or
fairfield
longer stay let's
as for extend this day
you can see here resident skin or town
place
or elements
pilton
worldwide
is also american multinational
diversified
hotel
uh company founded by conrad here back
in 1919
they have 15 brands with almost 6 000
properties
that's just the sort of the word
[Music]
it's their brand portfolio um in the
luxury line they have world of australia
conrad or and get canopy
first service
which is upscale or
pop-up scales you can see here
or doubletree or courier
they have all suites
of
lines which is somewhat related to
extend this name
embassy suites or homework suites or
homes
for christmas service it's someone
in the middle of like made it scarce or
upscales
hampton or herton gardens
not their friends
[Music]
hayat is also american-based company
founded by jay pritzker back in 1957
they have 13 brands with
over 700 properties in 54 countries
it's their brand food full year
luxury brand they have uh park ions
uh then they're in their premium brands
grand hyatt and regions
and that is also part of luxury brands
and then they also characterize them as
lifestyles
and then when it comes to modern
east centres they can see a high place
or high heights
ihg group uh it's british multinational
diversified um
hospitality company
founded by juan
tripe in 1946 they have 15 grand
as their friends may see a holiday in
everywhere
intercontinental hotel is their luxury
brands
and accor hotel is a french
multinational diversified hospital merch
group
and founded by poe and gerard back in
1977
they have 15 brands 1 almost 5 000
properties
maybe uh you're right i'm familiar with
fairmont
luxury brands
banyan tree is
the most luxurious wizard they can think
about
full moon is also part of their luxury
line novotel is first service line
avs
is their budget hotel
lines
as well on the software tail there's
also the luxury brands too
windham is american multinational a
diversified hotel company
founded by trammell
crowd company back in 1981.
they have 20 brands with
over 9000 properties
they mostly focus on
mid-scale or
budgets or economy brands
gabada
fertilize super 8 daisy micro town
along with windum choice ontario group
also focus on budget hotel brands
like comfort in
quality sleep in econo lodge
so
maria like i said
it's the biggest total company in this
world you can see sales revenue by
the marriott is
phenomenal
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