| After briefly examining the global context of | | | | -BERLIN HOLIDAY APARTMENTS - EXAMPLE OF |
| travelling trends and accommodation, the article | | | | NICHE STYLE BUDGET ACCOMMODATION IN |
| will focus on growth in economy accommodation. | | | | BERLIN- |
| Taking Berlin as a case study, it will highlight | | | | Indeed, niche style accommodation such as |
| different types of economy accommodation, | | | | branded budget boutique hotels and holiday |
| which could be part of key growth areas in 2009. | | | | apartments have become increasingly popular |
| The article does not offer ultimate solutions or | | | | since the 1990's. These types of accommodation |
| remedies to guard against the impact of the | | | | are not only very much in vogue and a more |
| recession, but it is does hint at certain safeguards | | | | stylish spacious alternative to that of a hotel or |
| which can be undertaken. This text is aimed at | | | | hostel, but also great value for money. The |
| accommodation providers and tourist operators, | | | | holiday apartment is an alternative option to a |
| who may not be aware or have the time to sift | | | | hotel for a family looking for flexible, spacious |
| through some of the more recent tourism | | | | accommodation, giving them the option of say |
| statistics. It offers a general, brief overview and a | | | | preparing their own lunch or evening meal and |
| subjective interpretation of the key Tourism | | | | thereby increasing their spending money. For the |
| trends from 2008 in relation to Accommodation | | | | business traveller the vacation rental is also a |
| lifestyle & budget Travel. | | | | good option. Berlin, for example, is a city that |
| - IMPACT OF RECESSION ON EUROPEAN | | | | attracts business people associated with the |
| BUDGET TRAVEL AND ACCOMMODATION - | | | | entertainment/media sector rather than say |
| We are in the midst of a global recession. The US | | | | investment bankers. This category of traveller is |
| was hit first followed by parts of Europe. | | | | more likely to be attracted to good value stylish |
| According to UNWTO, The World Tourism | | | | Berlin holiday apartments. Equally, the |
| Organisation who compiled data from the first 8 | | | | contemporary holiday apartment, is attractive to |
| months of 2008, published in October 2008, the | | | | the type of couples who would have been used |
| statistics showed a sharp slowdown in growth of | | | | to spending money on say a boutique Berlin hotel. |
| international arrivals in recent months and the IPK | | | | The boutique style holiday apartment is a great |
| (World Travel monitor company) pointed to a | | | | alternative as it offers them the charm and |
| possible decline of 0 - 2% in 2009. There is | | | | design flair that they are looking for at a price |
| however one region that is still booming, the | | | | that does not tear the purse strings away. |
| Middle East, where tourism growth in 2008 was | | | | Guests looking to stay in a stylish Berlin holiday |
| up 17%. We could all relocate our travel | | | | apartment, studio size, for example, could book |
| businesses there, but for those of us that are | | | | through Be-My-Guest and pay 60 Euros per night |
| operating out of Europe and wanting to stay put, | | | | (based on 2 sharing) |
| being aware of possible implications of the | | | | Other niche style budget Berlin accommodation, to |
| downturn and recent travel trends, is important in | | | | look out for in 2009 are guest rooms, bed and |
| making forecasts and decisions for the future. | | | | breakfasts and 'pensions', the latter of which is |
| There is no doubt that travelling trends are fickle | | | | the name for B&B's on the Continent. In |
| and hard to form long-term forecasts from, but | | | | Berlin the amount of visitors staying in boarding |
| they are not only useful indicators, but sometimes | | | | houses rose 20% from 2007 (Visit Berlin |
| have a major impact on the holiday | | | | statistics). I think especially more British holiday |
| accommodation industry itself. We know that | | | | makers would revel in the opportunity in staying in |
| luxury travel has declined, British Airways suffered | | | | a room in Berlin, especially in a Berliner Bed & |
| a 9% decline of its long haul flights and this could | | | | Breakfast, or an Inn Berlin. This type of |
| be interpreted as an indicator that luxury | | | | accommodation as well as the Berlin vacation flat, |
| accommodation may well also be hit. Indeed, if | | | | that I have outlined above, would appeal to the |
| Mariott International (owner of the Ritz Carlton | | | | culturally curious traveller who wants to |
| hotel group) could be taken as a barometer, its | | | | experience the real Berlin and get a feel for the |
| third quarter profit in 2008 fell by 28% (The Wall | | | | neighbourhood, as a local would. Furthermore, if |
| Street Journal digital network). If the prediction of | | | | you are staying in a guest room you would also |
| Niel Pedersens, Managing Director of the | | | | have a chance to chat with the host and |
| Supranational Hotels, is right, he foresees that "in | | | | appreciate the insider tips that may otherwise |
| 2009 hotel revenues will typically drop 20% with | | | | have been missed from a guide book or the |
| five star market hardest hit" | | | | standard hotel reception information. A typical |
| (PricewaterhouseCooper). All of this points to | | | | room in Berlin through Be-My-Guest would set |
| 2009 being a very challenging year for high end | | | | you back around 40 euros (based on 2 sharing) |
| travel & accommodation. It is within this | | | | - OTHER EUROPEAN TRAVELLING TRENDS TO |
| context that it maybe important for the luxury | | | | LOOK OUT FOR IN 2009 - |
| hotel & the entire holiday accommodation | | | | Other travelling trends can also provide the travel |
| sector to re-think ways of strengthening and | | | | industry with indicators as to which areas to |
| sustaining areas of their profitable business. The | | | | consolidate. The UNWTO report mentioned that |
| more luxury and middle range hotel providers | | | | the youth traveller was one of the |
| may not only need to make cuts across the | | | | fastest-growing segments with the the biggest |
| board, for example, but also look at ways of | | | | potential being over 30, for whom the share of |
| holding on to their existing 'loyalty" customers and | | | | youth travellers doubled in the five years from |
| make shrewd selective investment decisions. For | | | | 2002 to 2007. The trend, which is expected to |
| less high end hoteliers, one method may be to | | | | grow, was hinted at showing that youth travel is |
| think about ways of re-branding their economy | | | | more about culture and lifestyle than about the |
| accommodation offers, since it is budget | | | | age of a person. The trend may have had also |
| accommodation that many holiday makers are | | | | had a knock-on effect on economy |
| looking for in hard times. | | | | accommodation. According to the same UNWTO |
| When one looks at the bigger picture, the areas | | | | report, the traditional hostel, which is still by far |
| of growth which may arise in the holiday | | | | the most popular accommodation choice for |
| accommodation industry as a whole, may well | | | | youth travel, saw a slight decline, but the budget |
| have an impact even after the recession is over. | | | | hotel grew two-fold between the years of 2002 - |
| We do know from the recession of 1993, that | | | | 2007. Growth of Bed & Breakfasts and |
| budget hotels' turnover actually continued to grow | | | | self-catering also rose during this period for youth |
| during the recession (PricewaterhouseCooper). | | | | travellers. The report also pointed to a trend in |
| Also, in the slump between 2000-2002 the data | | | | the use of internet for booking holidays. This could |
| extrapolated is that only budget hotels | | | | well be tied to the growth of youth travellers |
| experienced increased growth during this period | | | | who are the most internet savvy of the age |
| (PricewaterhouseCooper). | | | | groups. Indeed the share of on-line bookings, for |
| - ECONOMY ACCOMMODATION IN BERLIN | | | | at least part of a trip, has risen from 19% of |
| QUANTIFIED - | | | | total trips abroad in 2003 to 41% in 2008. |
| Indeed, economy accommodation and budget | | | | Another interesting statistic is that there was a |
| travel are real potential growth areas in 2009. | | | | 4% increase to 19% amongst those saying they |
| Economy accommodation is also the theme for | | | | pay attention to friends and relatives when |
| ITB's 2009 annual tourist industry convention held | | | | gathering information about a trip, with travel |
| in Berlin. As previously mentioned it is the city | | | | trade as a resource beginning to slide. |
| break to Berlin that I am going to use as case | | | | The UNWTO report also highlights the fact that in |
| study for the purposes of this article, with | | | | 2008 sun & holiday travel was one of the |
| particular weight given to guests travelling from | | | | biggest growth areas with business travel also |
| British shores. | | | | faring well, however there was stagnation in the |
| So, how does one classify economy | | | | amount of city breaks being undertaken. This, as |
| accommodation? One could go by average | | | | the ITB report surmised, may have been due to |
| accommodation price per night, as compiled by | | | | the amount of British people cutting back on the |
| the ITB findings from the Pisa report 2009, as a | | | | amount of second short breaks undertaken. The |
| starting point. Since the average expenditure per | | | | reduction may have been due to oil prices having |
| night is 101 Euros, anything dramatically lower than | | | | gone up, the effects of which were either the |
| this figure could be translated as the amount a | | | | reduction of low-cost air-lines or the increase of |
| holiday maker would be prepared to pay for | | | | fares, which coupled with the delays encountered |
| economy accommodation. In Berlin an average | | | | because of new security checks, may have led to |
| four-star hotel double room price is 140 Euros | | | | a stagnation of people undertaking short breaks. |
| (on-line Berlin Time Out guide) whereas a double | | | | Maybe as a result other forms of budget travel |
| room in a Berlin hostel, the traditional economy | | | | transport such as train & car travel increased |
| style accommodation in the Circus Hostel, would | | | | significantly in 2008, which is what the report also |
| cost around 56 Euros, (based on 2 people sharing | | | | indicated. The good news is however that oil |
| a double room). And in a 2 star Berlin hotel such | | | | prices have made a recovery from its high point |
| as the Ibis Hotel, travellers pay up to 75 Euros | | | | last year. |
| per night (based on 2 people sharing a double | | | | In conclusion, according to the information I have |
| room). Typically, a budget boutique Berlin hotel, | | | | gleened, if businesses are firstly aware of the |
| like Arotel, would cost on average approximately | | | | impact of the recession on the tourism industry, |
| 100 Euros (based on 2 people sharing a double | | | | focus on their key areas of strengths and |
| room - price quoted as the average amount per | | | | weaknesses followed by selective investment and |
| night from a 3 day booking from March 13th - | | | | brand re-positioning, there is a good chance that, |
| 16th 2008) | | | | coupled with the help of governmental policies, |
| The traditional style economy accommodation | | | | they will be able to ride out the recession . It |
| such as the youth hostel is the most popular | | | | could be that changes made now may become |
| form of budget accommodation, especially in | | | | the strengths of the future. But of course, it is |
| Berlin. However, other areas to consider for the | | | | important to be equally aware that there are no |
| future growth are more niche style budget | | | | quick fixes in this game. |
| accommodation. | | | | |