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Third-party hotel management companies facing higher guest expectations as room rates increase, J.D. Power finds

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Davidson Hospitality Group ranks highest in guest satisfaction.

TROY, MICH. - With average daily room rates at hotels in North America now averaging nearly $150 - roughly 15% higher than pre-pandemic levels,1 - hotel guests have become more critical than ever of the décor, amenities and food and beverage options provided by the world’s largest third-party hotel management companies. According to the J.D. Power 2022 North America Third-Party Hotel Management Guest Satisfaction Benchmark, customer satisfaction declines 4 points (on a 1,000-point scale) this year, as higher prices drive increased scrutiny.

“It is no secret that many of the major hospitality companies have put off upgrades and deferred maintenance while they were in survival mode during the pandemic,” said Andrea Stokes, hospitality practice lead at J.D. Power. “Now, however, as demand has climbed above pre-pandemic levels and consumers are paying record rates for hotel rooms, expectations are rising rapidly. Now is the time for hotel operators to invest in the maintenance and renovations that improve quality in the eyes of guests.”

Following are additional key findings of the 2022 study:

  • Overall satisfaction declines as bar gets higher: On average, overall guest satisfaction among the largest third-party management companies is 837 this year, which is down 4 points from a year ago. The decline is driven by lower satisfaction with room cost and fees; décor/furnishings of guest room; and variety of food and beverage.
  • Busy front desk staff carrying heavy load: Guest satisfaction with front desk staff increases slightly this year, with these personnel earning high marks for speed of check-in, courtesy and knowledge. However, prior to reaching the front desk, fewer than half of hotel guests (48%) indicate being greeted by staff, which is down 10 percentage points from 2021.
  • Bringing true hospitality back: Beyond investments in maintenance, fixtures and furnishing updates, service training for staff is an area in which third-party management companies can have an immediate positive effect on the guest experience. When guests say hotel staff makes them feel like a valued guest, overall satisfaction scores are 139 points higher. When staff shows concern for guest needs or warm, sincere treatment, satisfaction scores rise 135 points.

Benchmark Ranking
Davidson Hospitality Group ranks highest in overall customer satisfaction, with a score of 875. Atrium Hospitality (870) ranks second and Crestline Hotels & Resorts (856) ranks third.

The North America Third-Party Hotel Management Guest Satisfaction Benchmark, now in its third year, evaluates guest satisfaction with branded hotels that are operated by the largest third-party management companies. It is based on six factors (in alphabetical order): arrival/departure; cost and fees; food and beverage; guest room; hotel facilities; and services and amenities. The benchmark includes third-party hotel operators with more than 14,000 rooms under management and is based on 3,804 guest responses for branded hotel stays from May 2021 through May 2022.

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