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Hospitality industry pursuing emerging markets

Wednesday, November 21, 2012

Hospitality industry pursuing emerging markets

It is no secret that serviced apartments and corporate housing offer business travelers an unparalleled experience while providing excellent value. As increasing numbers of executives choose to stay in corporate apartments while on business trips, major players in the hospitality sector are pursuing emerging markets to capitalize on new trends in business travel.

Untapped potential
Business Travel News reports that hotel chain Marriott is experimenting within the meetings space in an attempt to attract greater market share in what it believes is an underserved sector. Several properties in the chain's portfolio have tested new business models to capitalize on potential growth in the meetings and conferences space, something that the chain hopes to pursue more aggressively in the coming months.

"As we have done work with customers, associates and planners, [the meeting space] is not an industry that has experienced a lot of innovation," said Peggy Roe, vice president of global operations services for Marriott, as quoted by the news source. "Meetings spaces in the evening usually are not 100 percent utilized, so why wouldn't we let people use those meeting spaces? We're trying to see whether people will consider our space in hotels as places to work, not just places to sleep."

At present, pricing models have yet to be fully defined within the meetings sector of Marriott's hospitality business. However, a flexible price-per-attendee structure has been put in place at several properties, and officials at Marriott are currently evaluating the effectiveness of this approach.

While Marriott's attempts to diversify its brand portfolio are still in their early stages, it could signify a larger trend within the hospitality industry. Although Marriott's move is unlikely to deter many executives from choosing serviced apartments over hotel chains, it does suggest that the hospitality sector is changing to meet the needs of today's business professionals.

Slices of the pie
In a wider sense, the business travel sector is constantly adapting to changing trends. According to Fuseworks Media, shifts in global economic stability are having a substantial effect on worldwide business travel as companies seek to capitalize on the strength of emerging financial markets.

Data published by global business travel consultancy FCm Travel Solutions suggests that industries such as mining, manufacturing and the service sector are driving demand for business travel services in Eastern Europe, Asia, Latin America and the Middle East. This, in turn, could lead to the creation of business hubs in cities throughout these areas.

"Ghana and Congo in Africa are viewed as rising business hubs while Saudi Arabia in the Middle East is on FCm’s hit-list as a country of high potential for growth and investment," said Ciarán Kelly, general manager of FCm’s Middle East and Africa Network, as quoted by the news source. "Angola’s oil reserves make it highly attractive to G20 countries and corporations with commercial interests in mining."

While data from the Global Business Travel Association indicates that growth in traditional commercial hubs such as New York, London and Tokyo is set to increase in the coming years, the potential for lesser-known countries to become leaders in industries such as mining and manufacturing could herald a transition in emerging nations. As such, executives may soon find themselves reserving rooms in serviced apartments in more exotic countries as companies seek to capitalize on the significant growth potential offered by these markets.

Whether at home or overseas, business travel is changing, and many forward-thinking companies are keeping a close eye on these sectors. In time, the demand for business travel services in developing nations could offer untapped opportunities for savvy executives and investors.