Serviced Apartment Summit Europe: Travel Buyer Forum review

This year’s Serviced Apartment Summit Europe featured the new half-day Travel Buyer Forum with a series of discussions and debates on the use of serviced apartments in corporate programmes. Molly Dyson reports

The event – hosted at the Park Plaza Victoria – kicked off with a breakfast debate session featuring representatives from a TMC, a serviced apartment agency and a distribution company.

Session chair Mark Harris from the Travel Intelligence Network started the discussion with a figure from this year’s Global Serviced Apartment Industry Report (GSAIR), which shows just over 50 per cent of corporates use an agency or TMC to book serviced apartments.

The TMC representative said their company uses a mixture of direct channels and agencies, but says corporates doing their own booking usually have to be looking for serviced apartments already to use a specialist agent.

Meanwhile, the agency representative commented that those who use agencies don’t do so because they don’t want to book direct, but rather because they find value in the data provided by agencies. They said buyers ‘don’t want to know’ how much they could save by booking direct with the supplier if it means they’ll lose the value they get out of data.

It was also pointed out by panellists that serviced apartment distribution is still fragmented because operators face the challenge of potential extensions to stays – more so than hotels.

The TMC said the GDSs help providers sell the last few room nights in a week if they get Monday to Thursday bookings, but that this increases room rates because it costs properties more in cleaning and check-in than the usual extended stay.

Whose beds are they sleeping in?
The next buyer session of the day focused on transparency in the serviced apartment industry when it comes to who owns the property when a corporate books a room.

An agency representative pointed out a lack of clarity when providers sell their partners’ content through their website but don’t make the branding difference obvious. They said this can have an impact on a company’s duty of care obligations because the buyer can’t guarantee the quality or security procedures of the property.

A buyer in the audience said they depend on their agencies to act on their behalf to source content in areas where they don’t have preferred suppliers and ensure the standards are on par with the brands they trust.

The agency then turned the conversation to provider/agency hybrids, saying they should have to be honest with buyers if their content comes from other suppliers.

Another buyer commented that corporates share some of the responsibility in that aspect, saying buyers have to effectively communicate their needs in terms of safety and security so agencies or suppliers can ensure they meet their standards.

A representative from a serviced apartment provider said the industry has to do more to reassure corporate buyers. “The size of the company doesn’t matter; if something happens the manager wants to know why and that their travellers will be looked after,” they said.

They also went on to point out that buyers put a lot of trust in agencies and providers, and that their agent will often be the first point of contact for travellers if a situation arises. “Our obligation to the guest is the same whether it’s our property or not. It’s our transaction, so we have to stand by it.”

A buyer then said that travellers often have expectations if they book with a particular brand, whether it’s a hotel or a serviced apartment. If the traveller’s expectations aren’t met, the buyer has leverage to go back to their supplier to find out what happened, but the lines are often blurred if a provider isn’t transparent about who owns/operates the property.

Another buyer said the problem is only exacerbated by a lack of continuity in booking experience and technology, pointing out that clunky apps and websites make it difficult for travellers to get an accurate idea of what they’re booking.

The guest experience
Next up, a panel made up of executive assistants and an agency discussed the importance of the guest experience and what it should look like.

One EA said their company includes serviced apartments in their policy because not all travellers utilise hotel amenities and would rather have the larger rooms provided by apartments for longer stays.

However, the other assistant pointed out that many serviced apartment suppliers don’t offer loyalty schemes and provide a limited service in terms of a front desk.

Both agreed that they haven’t come across a serviced apartment that can compare to the 24/7 service of a hotel, but one said that often doesn’t matter to their company’s travellers.

The agency said it really comes down to the individual traveller, saying some desire a high-touch environment where they can get a response to their request straight away, while others would prefer to be left alone and given the ability to find the information they need on their own.

When asked about duty of care, the EA in favour of serviced apartments admitted that they do prefer traditional hotels when sending travellers to cities they’ve never visited because it means they will have access to on-site help 24/7.

And when it comes to cost, both assistants agreed that sometimes location is more important. But one said their company will often turn to serviced apartments for last-minute bookings because they found properties were less likely to increase prices for one-day lead times than hotels.

Technology cause a point of contention among the panellists, with the agency saying bespoke apps worked for providing standard information during short stays but that more complicated requests require human agents. They claimed this was the reason some suppliers don’t invest in developing guest apps.

The EAs countered that both business travellers and their assistants are very busy during trips and often don’t have time to seek help from an agent and wait for a reply. Both agreed that apps and technology such as chatbots can make a difference when it comes to the guest experience, with one buyer in the audience saying they don’t want to see leakage in their programme because a provider doesn’t have an app.

Friend or foe
BBT editor Matt Parsons then took the floor to quiz a buyer about serviced apartments versus long-term rentals such as Airbnb.

Parsons pointed out that the number of companies allowing the use of Airbnb in their programmes increased from 250 in 2015 to 2,500 in 2017.

That didn’t sway the buyer, however, who said their policy – which isn’t mandated – strongly advises travellers against Airbnb on the basis of safety and security.

“That’s not to say we’ll never work with them, but at the moment it’s too risky,” they said.

The buyer commented that the policy strongly recommends serviced apartments for longer stays because they offer a more secure experience and can often provide better value for money, especially as the company is reviewing travellers’ allowance during their stay.

When asked the repercussions for booking an Airbnb property, the buyer said they often pick up these bookings when they are expensed and find out why the traveller went off policy. They also said there is a long process involved in getting those expenses approved.

The topic then moved on to whether the company’s executives follow policy when it comes to booking accommodation. The buyer said their policy is the same for every employee regardless of rank and that upper management was very good at sticking to the recommended, cost-conscious options because they understand that they have to lead by example.

Parsons asked if anyone in the audience knew of a TMC that works with Airbnb and all buyers said their chosen TMC does not. One buyer said it comes down to the issue of a lack of consistency in standards and the high risk of unknown factors interfering with a traveller’s experience.

Serviced apartments 2025
Lastly, a panel representing serviced apartment providers, technology specialists, buyers and TMCs discussed the future of the industry, with a strong focus on technology.

It was pointed out that many of the conversations surrounding mobile booking and apps happened long ago in the hotel industry. Why is the serviced apartment industry so behind the times?

The TMC representative said a big part of the problem lies in fragmentation of distribution, with GDSs ‘struggling’ to accommodate the longer booking periods and variation in content seen in serviced apartments.

However, each panellist agreed that the industry is making progress and that technology will prevail by 2025, with mobile booking and chatbots set to be used more widely across the world.

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