Hotel Management and Consulting: Domestic Overnight Travel Performs well in 2019, Should Motels Use Online Booking Services?

Domestic overnight travel continues to perform well in Australia with about $74.5 billion spent during the year ending March 2019. The number of domestic overnight trips has increased to 109 million with a total of 386 million nights spent while travelling around the country.

However, the average duration of a domestic overnight trip has slightly declined by 0.3% or 3.5 nights and the length of holiday trips has dropped by 2%. Unfortunately, this has been the trend since 1999, according to hotel management and consulting firms.

Holidays continue to be the biggest contributor for domestic overnight travel accounting for 48% of spend. Visiting friends and relatives remains popular as well, accounting for 20%, whilst business travel accounts for 27% of spend, which is relatively high due to commercial accommodation and transport costs.

The bad news is traditional motels now face digital challenges that could threaten their survival. Travellers have changed what they want from short-term accommodation and how they find it. People on business trips are looking at services such as Airbnb. Room rates have not increased substantially, even with inflation and the margin is getting thinner hotel management and consulting firm, Sky Accountants, believe something needs to be done.

Corporate motels don’t feel the impact of online bookings very much but the commissions online booking services charge operators are quite concerning. Motels would need to increase their prices so they can offset the commissions.

According to Airbnb, over 500,000 companies across the world have arranged accommodation through their service and many local and boutique traditional hospitality providers, such as country motels, are increasingly joining their community. Airbnb has injected $69.1 million into regional Victoria in 2015-16 and supported over 600 jobs.

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