How to Manage an Airport Hotel and Maximize Its Revenue?

Airport hotels are a category of properties that you'll find in every city, no matter where you are in the world.

Located close to the airport, these properties are often preferred by business travelers, people in transit, and even leisure travelers looking to explore the city within a short period of time.

While most hoteliers running these properties rely on the location to get sales, there are other factors that could help maximize revenue.

Let's dig deeper into this discussion But before we proceed, let's just make sure we're on the same page about airport hotels, their location, and unique revenue management strategies compared to other types of hotel properties.

What are Airport Hotels?

Airport hotels are easy to find, as their name clearly states which airport they are closest to. Usually, these properties offer free transportation to the airport, since most of their business depends on this specific location. If a hotel has the term 'airport' in its name, a guest usually considers the property to be within a 15-minute drive of the departure or arrival area.

Why are Airport Hotels unique?

Once again, the unique selling point here is the location. Since these properties offer the advantage of staying close to the airport, they are ideal for guests with early or late flights, or who have a layover.

However, airport hotels can lure in guests with some other offerings, such as free breakfast, shuttle service, etc. Since most people with early or late flights prefer to stay close to the airport, some properties can even offer food for the way, where special catering inclusions come into the picture.

Considering everything, it's still the location that attracts most guests, and that's why airport hotels have this unique advantage over other properties in the city, no matter how good they might be.

What type of guests stay in Airport Hotels?

Like all other stay options, we can find many different types of guests at an airport hotel, and all of them have different needs. Hence, it's crucial to identify different sets of audiences, which could be targeted with special deals, offers, and services.

The Business Travellers

First and foremost, there are business travelers. A lot of big companies have training sessions, national and international hubs, and meetings, which require regular travel arrangements for employees.

Business travelers don't ask for much: just a comfortable chair, a work desk, stable Wi-Fi, and a bed to relax in after a long day of business meetings.

• Innovative Strategies for Business Travelers: To attract business travelers, airport hotels should provide convenient amenities like high-speed Wi-Fi and well-equipped workspaces. Flexible check-in and check-out procedures can also enhance the overall business traveler experience.
• Recent Developments: Many airport hotels now offer smart office solutions, custom keyboard layouts, and ergonomic chairs to make workspaces more productive.

The Leisure Travellers

The other category is leisure guests and families, who either have a layover or the flight got delayed. Other leisure travelers want a hassle-free and convenient trip without having to rush and commute. These travelers want a comfortable bed for a good night's sleep, maybe a small snack bar, and a restaurant serving local or international delicacies.

• Amenities for Leisure Travelers: Leisure travelers seeking comfort and convenience may enjoy amenities such as snack bars, local cuisine restaurants, and comfortable beds for a good night’s rest. These amenities can be tailored to meet the diverse needs of leisure guests.
• Pricing Strategies: To attract leisure travelers, hotels can offer competitive pricing for shorter stays or day-use rates, which can help fill vacant rooms during the day.

The Crew

Last but not least, the airline crew forms a major share of guests staying at an airport hotel. It is vital for an airport property to be in the 'good books' of different airlines, so they can reach out for accommodation options for the crew.

• Strategies for Attracting Airline Crews: Establishing good relationships with airlines and offering discounted rates and flexible booking options can attract airline crews. Personalized services tailored to meet their diverse needs can also be beneficial.
• Benefits: Fostering these relationships helps the hotel increase its occupancy rates during periods when flights are disrupted or delayed, generating additional revenue due to the high demand for last-minute bookings.

How to maximize revenue of an Airport Hotel?

Flexibility is the best way to drive revenue in an airport hotel. Walk-ins and last-minute bookings are quite common, and hence, the team on property needs to be prepared for anything.

It is best to create a separate special rate for walk-ins and delayed flights and not offer them the same as what’s online. Also, by creating a separate rate, you can track the results better. These walk-ins and last-minute bookings shouldn't be sold cheaper than the daily rate.

The daily rate should depend on flight schedules: when there are more flights coming in and leaving, prices should be higher to achieve maximum revenue. Since this will depend on the location and season, it's best to conduct your own market research and price accordingly.

Furthermore, establishing good relationships with local businesses is very beneficial. Make sure to explore the area, especially business hubs around the hotel and contact the companies. They could be interested in setting up a special rate (10% discount for example) depending on how much business they will be bringing you.

There can be additional revenue sources from ancillary revenue such as special mid-day menus for guests, who are staying only during the day. This could also be extended to room service and room amenities. You could even have different plans for Wi-Fi, depending on the speed and amount of data required.

In case the property has meeting rooms, those could be rented out as well to business travelers who would love to utilize them for business engagements.

Lastly, the airport shuttle or any transport service can be charged to gain some additional revenue. However, since this could harm the hotel's rapport with guests, it's best to use this as a last resort (instead it would be recommended to sell the room at a higher price).

How to price aircrews successfully?

Going back to aircrews, they usually take up more than 10 rooms. Hence, they're considered one of the biggest sources of revenue for airport hotels. Depending on the size and location, you could give them group rates. One way is that more rooms the airline books, the deeper the discount gets. This is ideal for hotels located further from the airport and/or hotels with a large number of rooms.

The second option is that more rooms the airline books, the higher the price gets. This incentivizes the airline to book less rooms, and the remaining bookings can be picked for walk-ins at a premium charge. This is quite beneficial for hotels very close to the airport or smaller properties that can't afford to book all the rooms for a single booking.

Either way, airlines and their business are crucial for an airport hotel. Hence, having some rooms allotted for the airline crew is kind of necessary.

What are the most important attributes of an Airport Hotel?

Airport Hotels are area-specific but travelers coming to stay there all want the same things: flexible check-in and check-out times. No one wants to miss their flight or leave/arrive at an inconvenient time. In the rush, it's better to make things easier for them with technology.

Similarly, having a transportation service is crucial. Most travelers like to get into a vehicle by the hotel and get dropped off at the airport. They don’t want to have to call a taxi and wait for it to arrive. As an airport property, offering transportation is a must-have.

Conclusion

Maximizing revenue at an airport hotel involves understanding the unique characteristics of these properties, catering to diverse guest needs, and employing advanced pricing and operational strategies. By focusing on flexibility in pricing and booking, leveraging local businesses, and exploring ancillary revenue streams, airport hotels can maintain high occupancy rates and generate substantial revenue despite the potential disruptions from flight cancellations and delays.

At HotelMinder, we offer hands-on advisory and project management services to help hoteliers maximize their business performance. Our expertise includes creating revenue management strategies tailored to different types of hotel properties, including airport hotels. For more information or to discuss how to enhance your revenue management strategies, contact us today.

Next up in: Revenue Management