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In June 2022, CNN Nightcap expanded from its original newsletter format to a digital show.

According to the press release announcing the show, the host, “…CNN Business’s Jon Sarlin, interviews newsmakers and expert panelists each Thursday to highlight unique insights and perspectives on where business meets culture.

“Entertaining, informative, and relevant, this weekly series is appointment viewing for the new generation of investors, influencers and curious consumers.”

Not long ago, Scott Keyes, the founder of travel website Going.com (formerly Scott’s Cheap Flights – the site had a name change and new app introduction earlier this year) told Sarlin why eliminating daily housekeeping in hotels may not lead to lower prices for guests.

Here’s the segment (you can fast forward to 9:47, after the ad)

Sarlin starts by reviewing that many hotels, which had decreased or totally stopped daily housekeeping during the pandemic, are now adopting it as a permanent measure. He used Marriott (which uses a tiered system) and Hilton (which uses an “opt in” system, saying it gives guests more “choice and control”) as examples.

After he introduces Keyes, Sarlin asks if he thinks people are aware of the changes in daily housecleanings and what are their reactions to this change.

Keyes said he thinks it comes as a surprise to a lot of travelers (Note from Sharon: remember that most travelers aren’t people who stay at hotels for the combined equivalent of weeks or months per year; most only go on a vacation or two, and, as Keyes said, some are just now traveling since the pandemic). Hotels aren’t advertising, “Hey, we clean less than pre-pandemic!” so when these typical travelers go to a hotel, they’re not expecting to get less service than a few years ago.

Sarlin continued by suggesting that some people choose hotels over Airbnbs because of amenities such as room cleaning. He asked Keyes if he thought it would hurt hotels in the long term.

Keyes replied, “Absolutely.” He said with these sacrifices, hotels were giving up a competitive advantage they had over home stays. At home stays, you get a superior kitchen and usually more space, but you don’t get the daily service that people came to expect from hotels. So people might consider not staying at hotels because they don’t have as much to offer as they did before.

Keyes suggested that hotels were doing something of an ongoing experiment to see how much guests are willing to give up and still stay with them, despite paying the same cost (or usually more) than they did pre-pandemic when they had those services for free. Meanwhile, the hotels are spending less on housekeeping labor and supplies, so their profits continue to rise.

Finally, Sarlin asked if hotel prices were any lower since the pandemic, since they offer fewer amenities such as housekeeping.

Keyes said prices were actually higher. They’re up 8% compared to 1 year ago and up 20% compared to pre-pandemic, with even higher rates in certain markets such as Las Vegas and Miami. He also suggested that hotels would not cut rates, and in the long run, not offering amenities such as housekeeping could hurt hotels.

Also noted – while Keyes was discussing that last bit, they included a chart that showed average hotel occupancy rates since 2019:

• 2019: 65.9%
• 2020: 43.9%
• 2021: 57.5%
• 2022: 62.7%
• 2023: 63.8%

Our take on this

Frankly, I don’t agree with Keyes on several points:

• It’s been 3 years and their own chart shows that occupancy rates are almost as high as they were in 2019. According to Stastista, occupancy rates for hotels have only gone up, at best by 2%, at worst by 0.3% (+/-) since at least 2011. Considering that we’re still pulling out of the pandemic in some respect, that’s pretty much on schedule, same as always.
• Prices are up everywhere. Cars. Housing. Groceries. Toys. Clothes. Energy. No one would expect hotels to lower prices, regardless of whether or not they offer daily housekeeping, because the price of running a hotel, both fixed cost and variable costs, is higher than it was 4 years ago.
• Keyes mentions cutting housekeeping could hurt hotels in the long term. What exactly is “long term?” Guests have already done without, or at least less, for almost 3.5 years now.
  Plus, really…they got used to not having towels replaced and then not having sample-sized shampoos; they either have or will get used to not having daily housekeeping.
• Having a full kitchen in an Airbnb is nice, but really how many people actually utilize it? Besides, the generation that rents Airbnbs the most are Millennials (they’re about 45% of Airbnb’s customers) and it’s thought they choose to stay at homes more than hotels because private homes have more space, more bedrooms, some are equipped with things babies or children might need, such as cribs, high chairs, toys, etc. Hotels have never offered most of those (save for cribs or high chairs, if they offer restaurant or continental breakfast), so it’s not as if anything has been “lost,” such as housekeeping.

One other note of good news: dozens of cities including Atlanta, Boston, Denver, Honolulu, Houston, Las Vegas, Los Angeles, Miami and New York, along with at least 2 states (New Jersey and California) require daily housekeeping of all occupied rooms, unless a guest refuses it.

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