Total guest nights in August 2010 continue to flat-line compared with August 2009 by dropping less than 0.1 percent. August just squeaks-in to join May as the only month that has recorded a comparable guest night decrease so far this year.
On the positive side, with the last of the winter month's guest night results now in, it is pleasing that overall trade has not lived up to the worst of gloomy predictions. On the less-than-positive side, domestic guest nights continue to soften and the motel sector continues to bleed market share.
In the battle of the two islands, the North Island recorded a 1 percent increase in guest nights while the South Island achieved a 1 percent decrease in August 2010 compared to August 2009.
Nine out of the 12 regions recorded less guest nights in August 2010 than in August 2009. The regions showing the largest decreases were:
- Taranaki/Manawatu-Wanganui, down 12 percent
- Waikato, down 9 percent
- Wellington, down 7 percent.
- Auckland, up 11 percent
- Bay of Plenty, up 6 percent
- Otago, up 2 percent.
Disappointingly domestic guest nights decreased by 1 percent in August 2010 compared with August 2009.
In spite of a relatively soft month, hotels have again managed to solidify their market share by being the only sector to record an increase in guest nights compared with August 2009, up by an impressive 7 percent.
The three other accommodation types in the survey all recorded decreases in August 2010:
- Motels, down 5 percent
- Backpackers, down 3 percent
- Holiday parks, down 6 percent.
So the question remains unanswered. Why is the motel sector rapidly losing market share?
To underline their dominance, hotels had the largest ever share of total guest nights in August 2010. Over recent years, hotels have increasingly had the largest share of monthly total guest nights and this would appear to be at the expense of the motel sector.
It would be an easy knee jerk reaction to assume that the hotel sector is merely gaining market share by discounting tariff. While we agree that many more hotels seem to be competing head-to-head with motels by dropping tariff, we do not believe that this is the complete answer as to why the motel sector is under performing.
Now that the insidious enviro debate has been sidelined by Qualmark, the motel industry needs to urgently look in the mirror and critique the acumen of its operators, service levels and quality.
Source: Click HERE
