Study: At upscale hotels, guest acquisition costs are devouring room revenue growth
Guest acquisition costs are escalating at the same clip as room revenue growth, according to a new, multi-year study of upscale and luxury hotels in North America.
If other hotel industry costs, such as labor and interest rates, also begin to rise sharply, the industry could face some severe erosion in margins.
The white paper analyzed the financial results of 104 boutique and luxury hotels that are affiliated with national brands in the US and Canada between 2009 and 2012.
Since the 2008 market crash, room revenue growth at the studied upscale and luxury hotels recovered 23%.