Understanding Airline and Accommodation Trends

Hi everyone, Sandy here and welcome to your module three for travel trends and insights. This module will get into some juicy product knowledge. um on the airline and the accommodation industry so a little bit about me a little bit more about me i should say um before working at flight centre um my background was um in hotels so i worked in the sales and marketing i've worked at front desk group reservations and i've also been um the pa to the general manager of a hotel so i have a little bit of uh inside knowledge as to what sort of makes a hotel tick um as well as lots of experience in booking airfares so lots of um airline knowledge from my time at Flight Centre booking lots of flights. So gaining knowledge in these sectors is really important for anyone wanting a career in the travel and tourism industry. So whether that be as a travel consultant, someone working for the airline industry or working in hotels. So whether you're on the Whitsundays hotel program, you know, going up to work in one of the hotels up there or if you're in a core hotel program as well. So So the aim of this video, I suppose it's a video lecture, is to give you a little bit more of an insight into the module, to give you some examples and just, I guess, so that you can help better understand the context of this one. So please ensure that you're also participating in the discussion forums in Blackboard, completing the learning activities because there's lots of cool little things in there to check your knowledge on that, as well as reading the essential resources or watching the videos that we've put in there as well. So this module should be completed by the end of week six so hopefully on track for that and information from this module as well as module four which is your next one will be in your next quiz which is assessment 1b and that is due at the end of week eight so you can check your assessment section in the left hand side of your blackboard for the exact dates that that will be open for your intake and you'll also find in there your assessment briefs with lots of instructions. as well as the assessment overview videos as well that you can watch there. Alrighty, so let's have a look at what we'll be covering this module, okay. So throughout this video, I'm going to give you a very high level overview of some key terminology that's used in the airline industry and the accommodation industry. We'll be looking at some strategies the airlines use, such as hub cities and airfare pricing. I'm also going to review information about aircraft and airline cabin classes, and I'll tell you how to find that information as well. I'll show you how to find it. I'll also briefly discuss the various types of accommodation that are in the market and the evolution of both the airline and the accommodation sectors with significant events that have occurred that have helped to shape and change those two sectors. So we've also got a live tutorial for Module 3. So please check collaborate or your student schedule for those dates where we're going to be doing some interactive activities that will help to build on this knowledge. So hopefully you'll be able to attend those sessions as well. So let's jump into the airline sector first of all. OK, so there's a little quote on the slide here, which says the airline industry quickly grew from one single aircraft, one route and one lone passenger. So today, aviation is the lifeblood of the global economy. The industry supports. over 58 million jobs and 2.4 trillion in annual economic activity so you can sort of see how quickly and how fast that has grown if you remember 1952 was the first commercial airline so we're now fast forwarded to 2023 and this is what it looks like so the airline industry is a very significant sector within the wider travel and tourism industry and so without it it would be really difficult to get to a lot of the destinations that we travel to so it is quite important And having a good understanding of airlines helps in becoming a successful travel consultant or an airline industry employee, if that's what your career goals are. So the airline industry has seen massive growth in passenger numbers and they're expected to grow to record numbers in the set of the next 10 to 20 years. So which is great for jobs in the travel industry, not only in the airline sector, but also in hotels. travel agencies tours you name it because pretty much if the airline industry grows everything else grows as well so let's have a look at some terminology now um for the airline industry so um some of these you may have heard of and some might be brand new so obviously you're going to have different levels of knowledge prior knowledge so we can draw on that but also we've tried to cover ones that you may not necessarily know of so um Yeah, so you might have researched or taken a flight somewhere. So hopefully there's some things that you do learn that you didn't already know. So the first one we've got there is fare aggregators. So these are websites that are basically search engines. So they search a huge amount of data from other websites, which helps customers to find and compare airfares between two city pairs. So an example of a fare aggregator is Skyscanner. So which is there's a little bit of an example on the on the slide there. So you can jump onto Skyscanner and you can put in some really basic search criteria such as dates, origin and destination. And then you press search and you're basically going to get a plethora of airfare options, usually listed by the cheapest. So it then provides you with a link on where you can book it. For example, it might direct you to the airline website or it could direct you to the OTA or an OTA, so an online travel agent or a booking site. So there are, of course. some pros and cons of using an aggregator. So some of the positives are that it is very quick and easy. It's a real quick and easy way to get an idea of how much a flight would be to your chosen destination and provides you with some website options that you can book on. It can also save you the time and hassle of having to search lots of individual sites yourself. However, there are some disadvantages that I just want everyone to be aware of, I guess, of these aggregators. So for example, if you're using the basic search method, so It won't factor in your preferences such as direct flights or it won't eliminate lengthy stopovers. So it might bring back the cheapest airfare. Say, for example, it might be a flight from Brisbane to Los Angeles that you're looking for. But the cheapest option involves a night in overnight in Sydney. So, you know, it has a flight that gets, you know, gets in from Brisbane to Sydney overnight and then leaves the next day, which isn't ideal. And obviously. you know you might be able to pay another 50 to 100 and actually get a direct flight straight from Brisbane to Los Angeles so um so because it's a it's an artificial intelligence it's not a human um booking it sometimes you know it just gets you gives you what you ask it for the cheapest option which um sometimes can cost you more if you have to pay for a night in Sydney for example and also not to mention the time saved by going on the direct flight so it also doesn't understand what's most important to your customer or to you as a traveler So this could be frequent flyer points or it could be the time of day that you want to travel or how many stopovers you want or even if you want to stop you know or where you want to stop. So it can also bring up several one-way flights or sectors that make up the airfare so you might have one way with Jetstar, one way with Hawaiian Airlines or something like that so meaning that you might need to switch airlines and potentially recheck your bags if it's booked several sectors. Or if you need to change your flights for whatever reason, you may be up for two to three different lots of change fees or cancellation fees costing you more in the long run. But if you don't mind booking with two to three airlines, that's fine. Some people might say, well, that's okay, I'm going to leave tomorrow and I want to book two or three airlines, I'm not going to be changing, all of that. You do need to be mindful that if one airline has a date or time change, and this does happen a lot in the airline industry, it's going to be a lot of time. then the other one may not necessarily be connected or interline with that airline. So you might miss the connecting flight or you might need to pay the change fees to change the other flight to match with the other one. So it's all right if you're spending overnight somewhere. That's not too bad because you can allow for time changes. And obviously you're going to be checking your bags and collecting your bags and checking them back in and things like that. So, of course, with a little FA knowledge, you can manipulate those search functions to filter out the best flights. But. most customers won't know how to do this. So moral of the story, fare aggregators are great for quick searches and to get an idea of prices, particularly when you're in the planning stage of that customer journey that we talked about in module one. But it's best to use a travel consultant or an airfare expert to actually book it just to make sure that you're getting the best fare. So the next one on the list there is a full service airline. So this is Just as the name suggests, it's an airline that offers full service. So this generally is, but not always, includes your ticket, your seat selection, checked baggage, meals, beverages and things like pillows and blankets. So this is obviously we're talking international flights mainly. So the opposite of full service airlines are low cost carriers, which I'll chat about in a minute. But some examples of full service airlines when flying internationally from Australia include Qantas, Virgin Australia, Emirates. Air New Zealand, Qatar, Singapore Airlines, just to name a few. All right, so maybe you've had some experience on a full-service airline. previously um or you might have had some experience on a low-cost carrier as well um and look there's no real right or wrong for which ones are the best um it really just comes down to what's most important to the customer so you know if you're not needing um to take baggage or you don't really want a meal or um things like that then a low-cost carrier might be the best option for someone whereas if you are needing um you know a uh you know you wanted to you've got a few people traveling together and you need that seat selection you're traveling with bags and things like that then the full service airline might be the best option so it really just depends on what's most important so the next one that we have there is IATA so you might have heard us talk about IATA previously but it stands for International Air Transport Association and they're basically the trade association or governing body for the airline industry so they're responsible for things like standardizing airline safety and security and for coordinating global airline policies and procedures you So they represent about 300 airlines or 83% of the total air traffic worldwide. So they're pretty big. Low-cost carriers, as I mentioned before, are the opposite of the full-service airlines. So they offer cheaper airfares than the full-service airlines generally, not always, but operate more on a user pays systems. So they generally have lower fares and fewer inclusions. So customers can then decide if they want to pay for extra things like checked baggage, seat selection, meals, beverages. um priority boarding all of those sorts of things so some examples of lccs um are jetstar air asia euro wings scoot and we've just had a new addition to the australian domestic market which is bonza airlines so which you might have heard of in the news cool so that is another one let's go to the next one which is further terminology so preferred supplier agreement okay so often travel companies such as flight center we'll have what we call preferred suppliers or a preferred supplier agreement with other companies and sectors in the travel industry. So for example, we might have a preferred wholesaler, we might have preferred airlines or hotel brands that we would recommend. Okay, so in exchange for sales, the company then offer a flight centre a more competitive price, kind of like a bulk buying power and better support for things like product training and reps and um, Other benefits such as higher commission or marketing sponsorship for things like awards and expos. So kind of like the old saying, I'll scratch your back if you scratch mine. And the relationship is designed to be mutually beneficial. So it does exist in other industries too. So, for example, in the grocery industry, Carl's and Woolies, for example, would have preferred suppliers for their meat and their fruit and veg. And the more they purchase through one wholesaler or preferred supplier. the cheaper they get it for, which means that they would have more competitive prices to pass on to the customers, or they can also make maybe more profit margin as well. So there's obviously some good benefits there, but that's often a term used in the travel industry. Okay, so revenue management is, obviously in the airline department, it's basically a group of people that are responsible for maximising revenue or sales of airline seats. So airline revenue managers adjust the fares, you know, they can do it on a daily basis, but you know generally throughout the year depending on things like the route, the season and also supply and demand. So their aim is to maximise the revenue for the airlines, so sell as many seats as possible, which is why the general rule of thumb is that the earlier you book, the cheaper the airfares will be. So flights are not filling up as fast as they'd hoped, they might offer sale fares or happy hour fares to try and to sell those emptier flights. So the more full a flight becomes, the more demand there is for it. And so the airline can charge a higher price. So I will talk more a little bit about in a little bit of a moment about the different factors that can impact the cost of an airfare as well. We have a look at airfare pricing. The terminology of traffic is as tend. We tend to use it mainly by airlines, I guess, to describe the passengers carried on a plane. So high traffic demand is where there are more people. who want to travel on a specific date or route than there are flights for. So that's just a little bit of a explanation there on those. All right. So now let's take a look at hub cities. All right. So I hope I can explain this concept of this strategy here a little bit. So hub cities are or every airline has a hub city. OK, so and that airline needs to travel through that hub city whenever they leave their home port and go to another destination. They do need to. or their home port is their hub city I suppose so whenever they they leave from another destination to another destination they have to go through their their hub city so if you imagine a wheel where you have the hub in the middle and the spokes coming out from the hub so each spoke represents an origin and a destination and the hub is the city or the airport it needs to fly via okay so this is what is known as the hub and spoke system in the airline industry and it was invented to maximize route viability so to create more efficient routes and bigger flight networks for the airlines without having to increase the number of aircraft so as i mentioned every airline has a hub city for example singapore airlines their hub city is singapore so every flight that goes from a to b needs to fly via Singapore, well that is flying with Singapore Airlines goes via Singapore. So Thai Airways, they fly via Bangkok, Malaysian Airlines fly via Kuala Lumpur, Emirates fly via Dubai, etc. So if you were flying from Sydney to London, let's say with Emirates, the route you would take would be Sydney, Dubai, London, and then you'd come back the same way back through Dubai, back to Sydney. So you might be thinking, Why do I need to know this? Okay, so it is useful to know there are a few reasons. Firstly, if someone wants to stop over on their way to a destination, knowing which airlines stop in which cities can help you to recommend the best airline for them. Or you might have a customer that's wanting to go to two different destinations. So using the two airlines that have the two destinations as their hub cities can actually help you to create the best way to travel for them. And when I say the best way, I mean all in one ticket, which means that you have to go to the right place. you know, everything sort of covered the whole itinerary within one ticket. So, for example, let's have a look at the example that we've got up on the screen there as well. Leaving from Sydney and you want to go to Tokyo and Singapore. OK, so, yes, sure, you can find one way flights with different lots of with, you know, different airlines from Sydney to Tokyo, Tokyo to Singapore and then Singapore to Sydney. But it's likely to be much more expensive than booking one return fare. okay that allows you to do all the flights in one ticket which is which is the goal so if you book um also if you book the three individual tickets they'll also have three lots of changes and cancellation fees so if you do need to make those amendments or um changes to your travel plans down the track that can actually cost more as well okay so if we use that exact example let me explain this a little bit more so let's say travel wants to go to singapore and tokyo singapore is the hub city for singapore airlines and Tokyo is the hub city for Japan Airlines so we would look at Japan Airlines okay so let's say they wanted to stop in Singapore first then Tokyo if you have a look at the the slide there we've got the stop represented there as a circle and the transit represented as an x so you can sort of see the itinerary that they want to do there and just so you know every airport has a three letter city code and every airline has a two letter airline code as well so they're things that are good to get to know as if you are working in particularly booking travel as a travel consultant. So if we were to then do searches in our GDS system, so in Sabre for example if you work for Flight Centre, you would do two airfare searches. So one would be with Singapore Airlines and you'd do it from Sydney to Tokyo because you know you're going to go via Singapore and the other one is going to be with Japan Airlines but your search would be from Sydney to Singapore because you're going to go via Tokyo. All right so two different searches. So then the one with Singapore Airlines will go Sydney, Singapore, Tokyo. Tokyo would be the point of turnaround there and then come back via Singapore to Sydney. OK, let's say that comes back around $1,200, including taxes, just to pull a figure out of my head. All right. And then the one with Japan Airlines will go from Sydney to Tokyo and then to Singapore, which is your point of turnaround. So you go Sydney, Tokyo, Singapore, excuse me, and then you go come back via Tokyo and back. to Sydney and let's say that one is 1190 so there's not much in it in terms of prices so if there isn't a lot of difference in price and or if that's not that important to your customer if you know your Asian geography well you'll know that Japan is further north than Singapore so it would make more geographical sense to go with Singapore Airlines in this instance as there'll be less flying time and miles traveled so hopefully that makes sense there all right so So as mentioned before, revenue management is a way for airlines to maximise their revenues for their seats that they've got on their aircrafts. So let's have a think about some of the reasons that airlines offer different prices within the same cabin class. OK, so they could be for lots and lots of different reasons. So as I mentioned before, availability. So the full of the flight, the more expensive it usually is. There could also be some advanced purchase restrictions on the ticket. So, for example. If you purchased it 21 days in advance, so more than 21 days in advance, it might be cheaper than if you booked it last minute. as we mentioned before the inclusion so whether it's a low-cost carrier or a full-service airline so some fares include baggage some don't so that can factor the the prices of affairs of airfares it could also be the conditions of the fare so is it non-refundable or is it flexible you know so some airline affairs um you know it's free to change um there's no you know um there's no change fees there's no um cancellation fees it's refundable Some of them are completely non-refundable. Some of them you do have to pay to change and pay a fair difference as well. It could also be the timing of the flight. So your early morning flights, sometimes the red-eye flights tend to be cheaper because they're less popular, which can also relate to availability and that supply and demand factor as well. It could also be the class of travel that you're travelling in, so whether that's economy, premium economy, business or first, which I'll speak about a little bit more as well later. It could be the timing of your purchase. So you could have booked it as an early bird package or at the travel expo or it could be last minute. So it could be a lot more expensive. You've also got different fares. So, you know, you've got different booking classes for different fares. So that could be special fares for student types such as students or seniors or companion fares. So there's lots of different factors. Another, I suppose, another really important factor is that. the time of the year that you're traveling or if there's an event on so school holidays are usually more expensive than if you're traveling outside of school holidays so things like Christmas and Easter tend to be more expensive than no holiday period and if there's an event on so if it's an Olympics or Commonwealth Games or Grand Prix or something like that then our flights will tend to be more expensive because again there's that supply and demand factor all right so lots of different factors there. might explain why you're sitting next to someone on the same exact same flight and you've paid you know half the price that they have or they might have paid half that what you've paid so just helps to explain that um a little bit of a travel agent's uh you know not not nightmare but challenge when airfares are constantly changing and you know customers sometimes don't understand why they can't get the the airfare that's advertised for 99 or something like that on on you know the day before christmas or something like that so It's just a matter of, you know, setting up expectations when we're chatting to our customers. So when it comes to the airline industry, there are many different types of aircraft out there. So they're all different sizes, seating configurations, and they all have different features. So as you can see, they go from the really big ones, you know, the A380s down to the little ones. So you will have, you know, some people that have some customers that are very much. airline nerds out there so um but as someone working in the travel and tourism industry you're not expected to know all of the facts and figures and memorize them of every aircraft but it's important to recognize that the planes are not all identical um and also where you can go to find out this information so obviously you've got a gds system that you'll be familiar with and there'll be certain information that you can find um out about the the flight that you're you've booked or you've quoted um so you can go by booking number it'll tell you what aircraft type it is um And then you can do further research so you can go to the airline's website. But there's a really cool little website that I wanted to share with you. It's called seatguru.com, www.seatguru.com. And it's a really good tool to be able to sort of have a search. You might be wanting to sort of check what the seating configuration is on an A380. So this might be important to families who are wanting to sit close together on a flight or You might want to find out. And they've got, like, reviews as well, so you might want to find out which are the best seats and which ones to avoid, you know, the ones that have no recline or they might be really close to the toilets and things like that. So you might also be wanting to know which airlines offer premium economy because not all airlines have every class of cabin available. So you might want to find out which ones actually have premium economy or which ones have business or which ones, you know, have that recliner or the lie flatbed. you know so it's got a lot of information in there it's kind of a bit like a TripAdvisor I think it is actually powered by TripAdvisor for the airline industry so I encourage you to jump on and have a look at SeatGuru have a bit of a play with information what you can find on the site so they've got seat maps they've got airline comparison tools so it can be a really great tool when you're asked questions about aircraft types when you're working in the industry all right you So speaking of different cabin classes before there are four main types but as I mentioned before and also it's on the slide there not all airlines will have all four classes of service so they might have a combination so you might have some with economy and business economy and premium and business or you might have economy business and first for example so um what are the main differences let's have a look firstly the price so um it's a case of you get what you pay for so economy which generally has the least leg room and least inclusions but it is usually generally the cheapest and the most affordable um some people will also affectionately call it cattle class um a bit of a you know funny name for it um Premium economy class is a good compromise between business and economy. So if you're not prepared to fork out for the business class airfare, but you want extra benefits such as a bit of a bigger seat, better service, extra leg room, a private section in the plane, like in the cabin, you might get a nicer meal, better wine selection. Premium economy might be a great option for it's a bit of a compromise. So business class, so as well as the luxury of either a lie flat. bed or recliner seat. You'll also receive, you know, restaurant quality meals, you know, chef inspired, better selection of drinks, priority boarding, access to business class lounges when available. And you've got obviously more crew to a smaller amount of customers or passengers. So some airlines even offer a chauffeur drive transfer as part of their business class ticket. So, you know, you can get a chauffeur. Basically, it's a transfer that picks you up from home, takes you to the airport and then from your airport to your hotel at your destinations as well. So first class now as business class is now so good. Some airlines don't even have first class anymore as an option. But first class not only offers all the benefits of the business class cabin. It also takes it up a notch even further with closed suites, private bathrooms, butler service. even more luxurious amenities and that sort of thing. So I'm going to now play you a short video with just, it's basically Emirates A380 Airbus. So they offer economy, business and first class. And it will just show you a little bit about what these different classes look like on Emirates. Welcome aboard our Emirates 3 class A380. Thank you for visiting us on our brand new Free Class A380. How good do those suites look? Oh, it makes me want to travel. I love those little minibars as well, personal minibars right next to your seat. How good is that? All right. So let's jump back in now and continue. We're going to have a look at the evolution. So we've talked about the evolution of the travel industry in general, so in Module 2. So what we're going to have a look at now is the evolution of travel. the airline industry. Okay, so some key observations here, you can have a look at the timeline here, but overall the cost of airfares, which is measured in weeks of pay on the timeline here, has dramatically reduced over the years. So this is due to things like bigger planes, more competition, so more airlines, more efficient aircraft, advancements in technology, more connected cities and more people flying. So That has definitely helped to bring the cost of airfares down in a relative scale. So what once cost 85 weeks of pay to fly from Australia to London in the 1950s now equates to around one, one and a half weeks pay in current times. So a major year in the airline's history is 1952, which was the emergence of passenger planes for commercial aviation. So the first routes were from London in the UK. to Johannesburg in South Africa and also to Colombo in Sri Lanka. So as you can see from the timeline, the number of people travelling from Australia, also known as Australian outbound departures, has increased dramatically over the years. So from 161,000 in 1965 to exceeding 10.5 million in more recent years. The 70s also saw a bit of development in the airline industry with the wide body jumbo jets, which enabled the airline. to expand their capacity. And also there was the first supersonic jet, the Concorde, which made its first transatlantic crossing in 1973. So they were only ever manufactured for Air France and British Airways and they ceased flying in 2003, saying it was due to low numbers and rising maintenance costs. But it also followed a nasty crash in Paris in July of 2000 as well. So... They just were not really economically viable to have anymore. But I guess, you know, in the future we are looking at, you know, the comeback of the supersonic travel, you know, faster planes. I think it just wasn't worth it for the amount of money extra that they were charging. It wasn't worth it. So 1978 also marks a pretty important year. This was the year that deregulation occurred in the airline industry in the US. So... deregulation is basically the removal of government or federal control over airline regulations such as fares, routes and also the entry of new airlines. So there are always going to be pros and cons to consider. So for example, it did stimulate a lot of economic growth and increased competition. A lot more airlines were able to enter the market. But, you know, so that obviously made it more accessible for more people and more affordable. But the downside is that it can. you know, create issues with things like standard control, that sort of thing. So in the 1980s, this is where we sort of had the entry of that low-cost carrier or the no-frills airlines to the markets, which we spoke about earlier. 1990s was when the hub and spoke system was introduced to assist airlines in that route viability and network offerings that I spoke of earlier. Interestingly, in the... In the late 1990s, airlines actually expanded their fleet due to rising oil prices, technology advancements and economic changes. So, you know, when something does happen within the world, you know, that can have an impact on the, you know, the airline industry sectors and other sectors as well. So events such as the terrorist attacks in New York, September 11, 2001, impacted airline security and operations. So. That's why now you can't take, you know, sharps on board or you have increased security through airports. In late 2000s, new long-haul aircraft were introduced, so being able to travel longer distances. Also Qantas started experimenting in sort of the late 2010s, if that's a thing, with new anti-jet lag services. for passengers so things like you know dimming the light you know changing the lights to how your destination you know what it's like at your destination and all those sorts of things you know just to try and reduce jet lag for customers and then obviously in the most recent years we've had a COVID-19 pandemic which has had a dramatic impact on the airline industry. Obviously lots of flights and aircraft were grounded. They all went to, you know, sort of have a bit of a rest for a few years and, you know, if we have a look at, you know, I suppose 2022 is kind of like the start of that recovery, you know, and, you know, we see a real, like I suppose we're going to see lots of demand for, you know. airlines and flights and whatever as the world reopens. So and IATA obviously you know has some forecasts there and a recovery plan in place for the airline industry. So speaking of IATA again hopefully you remember from the terminology section what it stands for. So just to recap International Air Transport Association and their main objective is to govern safety, security, efficiency and sustainability for their members. So if you are researching information on the airline industry, so you might choose the airline sector for your Assessment 3 for TTI, a good resource is the IATA website or any reports that they do publish. So there is some further information on what they do listed here on the slide as well as a link to their website. So many travel companies, especially airlines, they use IATA forecasts to help them make critical business decisions such as the purchase of new aircraft. what destinations to travel to, as well as how many staff they might need to employ and trains. Obviously you need to plan for those sorts of things. So according to IATA forecasts, by 2025, the top three countries to be the world's largest aviation markets are going to be China, India and the USA. Which kind of makes sense since these are the countries either with the highest population or the strongest economic growth. Okay, so they're going to have the largest aviation, so basically the largest number of flights within those countries. All right, so there are many trends that are impacting the airline industry. So some of them are technological, some of them are environmental, and others will be behavioural or legal, political. So, you know, it's worth having a look at these. These might be trends that you choose, again, for your assessment three, but you'll be able to find more information using these sources here. or even just do your own research in terms of some of these trends. So as you can see, some of them will be, you know, linked to the environment. Some of them will be linked to technology. Others might be behavioural, you know, and because of the pandemic and, you know, that sort of thing. So definitely, you know, come back to this slide when you're looking at trends for Assessment 3 if you're doing the airline industry. All right. So a good airline to learn more about as well, which is a good start. is Australia's largest domestic and international airline. So I encourage you to do some independent research on Qantas. So, you know, find out who they are, where they fly to, so what's their network. I mean, there's a little bit of a map there, but, you know, really delve into their website. Do they have a frequent flyer program? Is it free to join? What inclusions do you get on board, you know, when you're travelling internationally? You know, how much baggage do you get included? You know, things like that. Do they all have, do they have all the cabin classes? you know which ones do they have do they have business and first or premium economy what aircraft do they use um you know often airlines will have like a certain fleet of aircraft like they might have the you know the 747s or the the a380s and that sort of thing just be good to get to know a little bit about the um the the airline um do they have business class lounges in which case which cities um do they have any any affiliation with any other airlines as well So there is also an airline activity in the Module 3 discussion forum that asks you to choose an airline and do some research and find out the answers to a few of the questions there. So it's a great way to start exploring your product knowledge on the airlines. And, you know, I suppose a good place to start is to start with, you know, some of the more common ones from Australia and then start to build on that knowledge. You know, find out, you know, where their hub cities are and things like that. So we're now going to move on to the second part of this module, which is all about the accommodation sector. OK, so there's a little quote here from Rebecca Gross. So she says hotels are no longer just a place to stay, but rather have become lively and connected destinations for visitors and locals alike. As trends in the travel industry have shifted, large and small hospitality brands have reacted and adapted to new generation of hotels. All right. So what she's talking about, obviously, in the. in terms of trends in the travelling industry shifting, she's saying that hotels are adapting to trends and also, which talks about that generation, that newer generation, I suppose, she's talking about like the millennials and even Gen Z that are coming through. Also other trends that hotels are having to adapt to are environmental trends, so sustainable tourism and eco-hotels and things like that. Also behavioural trends. they would need to adapt to those so things like the wellness trend and uh families you know like multi-generational families and also pleasure and people doing workations and things like that so um then you've also got your technological trends um so things like travel apps biometrics artificial intelligence robotics all of those sorts of things we will talk a little bit more about trends um a lot more about trends in module six as well Alright, so let's have a look at some of the terminology used in the accommodation industry. So some of the terminology might be familiar to you, especially if you've ever worked in a hotel or even stayed in a hotel. So I'll just run through them quickly and give you some examples where needed. So affiliated hotel, this is a hotel that is part of a group of hotels operated by the same company. So there are many examples here, including Accor, Marriott, Hilton, Starwood, etc. So many hotels belong to a chain of hotels. and they are then part of a group of hotels so they're known as affiliated okay they're kind of related so the term allotment is used to describe any block of rooms at a special negotiated rate that a hotel has given to another party such as a wholesaler or tour operator that they can then on sell to their customers so this um i guess the benefit of this is that means the wholesaler or the tour company can freely sell those rooms without having to check availability um each time so they kind of guaranteed those rooms For example, Contiki has a set of itinerary, basically set itineraries that they do their group tours for, you know, they can have up to 50 people on their tour. So they need to know for sure that they can stay at those hotels that are listed on their itineraries and on the dates that they're in those cities. So they're given an allotment and then there would be a certain time that they would have to release them back to the hotel for them to sell. So if they haven't been sold or used. So. Contracts will get renewed each year kind of and reviewed depending on sales. So obviously if you don't sell your allotment, you might not get as much next time. And if the wholesaler or tool company has released the rooms back, they need to then request availability if they want to sell it after they've released it back. So that's why sometimes hotels will have no availability showing on their website, but a travel agent may be able to access availability through one of their wholesaler's allotments. So I once had a lady who came to me asking for some accommodation near the Lakes Resort in Cairns. So she wanted to find out which hotels were close by because her family was staying there for her brother's 40th. And she had tried to book online at the same resort, but all the two-bedroom apartments had been sold full. So then I said, well, let me just check my wholesalers. So I contacted them and they had one room left, okay, through their allotment, even though it was showing. sold out on the um even the hotel's website was saying sold out but this particular wholesaler still had one hotel one room left as part of their allotment so I booked that for her and then she said that they actually needed another room for her sister so then I contacted another wholesaler and they had one room left so between the three kind of different sources she was able to get availability for her whole family to celebrate the 40th birthday there so that was kind of kind of a good um outcome there but you know I guess important to understand how allotments work. Average room rate. Okay. So this is the average price of a hotel. Also the average price a hotel sells their rooms for. Okay. So for example, they may have sold a thousand rooms for $200 per night and a thousand rooms for $250 a night, just to make the maths easy for me. So the average room rate would then be $225 per night. So again, it's just the average of the price of a hotel room. Back of house. I like to think of this as a bit of a back of stage if you're thinking about a theatre where, you know, it's all the employees that are working in that area have very little contact with the hotel guests. They're kind of like not out on stage or anything like that. So examples would be, you know, someone working in the back office like the accountants or payroll or, you know, even reservations sit out the back sometimes. But kitchen staff, housekeeping departments, that sort of thing. All right. So. Contract rooms. So some hotels will have specially negotiated rates for travellers that frequent their hotel often. So it could be airline crew, it could be corporate travellers or even long-term business travellers. So the company is then invoiced for the accommodation after they've stayed and they usually get a better rate. So it's kind of a contract rate or a contract room. All right. Now the opposite of back of house is front of house. And this is like the people that are kind of, I suppose, performing on stage, if you think of it as the analogy of the theatre. The employees have extensive guest contacts such as front office, guest services agents, restaurant staff, the porters, etc. All right. So no show. So this is an industry term for someone who had a confirmed booking at a hotel but then didn't arrive. So this could be obviously for a few reasons. So maybe they missed their flight so they didn't arrive in time and they didn't have a chance to let the hotel know. You know, they might have been delayed in the air. They also may have made their booking like a non-refundable booking. So and if they could no longer travel, it's a change of circumstances, but instead of cancelling, they just left it because they weren't going to get a refund anyway. All right. So, yeah, I'll talk a little bit more about overbooking in a moment. But occupancy relates to the number of rooms that are occupied over a period of time. So it could be a day, a year, a month, you know. So, for example, if a hotel has 200 rooms available on any one day and let's say 150 are occupied, then their occupancy for that day would be 75 percent. And when calculating it for a month or a year, you just need to look at the average occupancy rates. OK. So some hotels overbook. Okay, so this is overbooking. Some hotels will overbook, meaning that they take more or make more reservations for the number of rooms than they actually have. So especially if they can confidently bump guests to affiliated hotels, so you know what that means now, or you can offer them upgrades if necessary. So I suppose this is the hotel's way to maximise revenue and hedge their bets by looking at their average rate of no-shows that they get and saying, okay, well, we know that. on average 5% of people no show. So we're going to overbook by 5%. So that way they can maximise their revenue there. All right. Rack rate. So rack rate is just a term that is given to the highest rate for a specific room. So it's kind of like the full gross rate. And often rates are discounted based on the rack rate. So for example, if you've got a membership with like the entertainment card or with RSEQ or RAA or something like that, which gives you a percentage off certain hotels, it's often off the rack rate and not the cheapest rate that you've found. Okay, so often I'd get customers asking me about that, saying, oh, I've got 50% off, so I'm going to go and book that through Entertainment Card. But then sometimes the specials or the last-minute rates can be even better than those deals as well. So it's just, I guess, a matter of shopping around when you're looking for the cheapest rates for your accommodation. All right, so as you're probably aware, there are many different types of accommodation to suit many different customer needs. So, but we can't always assume that customers will always want to stay at the same type of accommodation for every holiday or not everyone will want the cheapest as well. So, for example, I might be generally a four to five star type of customer. But, you know, on a road trip, I might be happy to stay at a motel because that might be the best option where you can just park. You know, you've got to just want to crash for the night, you know. have access to your car you don't have to lug your luggage up and down stairs and elevators and things like that so that might be the best option for that particular reason but i potentially wouldn't stay there for a week you know um honeymooners might also spend more and want the luxury that a resort or a boutique hotel might provide you might have families that want an all inclusive resort with a kids club or they might want apartment style so they can save some money and do some cooking You know, they'll have a kitchen and cooking facilities there and perhaps a little bit larger space. Budget travellers or those travelling alone might choose a hostel, for example, to save money or maybe even to meet like-minded people. So if they're travelling alone, they might want to stay in a hostel so that they can meet other people, make some friends along the way. And those conscious of minimising the impact on the environment may choose an eco hotel for those reasons as well. So lots of different types of accommodation. All right. um there's a couple more there as well that you can have a look at there's you can read the descriptions on those on on your slides um all right so let's have a look at the evolution um so there are a couple of uh slides here that summarize the evolution of the accommodation sector so it starts uh back in i suppose then the 1950s not the 1950s the 1500s um which um where we had the french and the english law um required people to keep registries of, I guess, register, I guess, of people staying in inns or hotels as we know them now. So and a register is basically just an official list of hotel guest names. So, yeah, I guess that became a bit of a law back then. So also around that same time, 1500s guidebooks began to appear detailing the best ofs in regards to a hotel's cleanliness and cuisine. So it's kind of like the first Lonely Planet-style walks or... an olden day trip advisor i guess when it comes to hotels um 1700s we saw hotel construction expand in europe and the us so this was the start of the industrial revolution so hopefully you remember that from module two um so in new york first of all then copenhagen hotels were established in city centers um early 1800s holiday resorts actually became popular along the french and italian rivieras so i actually learnt um probably way too late that Riviera is an Italian word for coastline because I used to always think it was something related to a river um so just FYI um the Holt Hotel in New York was also the first place to provide its guests with a lift for their luggage so you can imagine what it would have been like back then when you know you would have had to have probably had fairly low hotels there wouldn't have been big high-rises because you would have had stairs um to you know to have to take your luggage up um and you know think about you wouldn't have had electricity and hot water and also it's all those sorts of things probably had a potbelly stove that you had to heat your water up to have a bath you know those sorts of things so mid-1800s major hotel construction began during the industrial revolution as steam train increased access to travel so seaside resorts began to pop up as people escaped to city centres for the weekend so they wanted to escape the you know the cities and the factories and you know the the hustle and bustle So, yeah, so as train travel increased, so did seaside resorts. In 1862, the Grand Hotel, which is the famous hotel in Paris, became the first truly modern hotel due to its grandeur and indoor lighting. So, yeah, that's, I suppose, you know, having electricity in a hotel was pretty cool back then. Now it's just an expectation. The 1920s was the first ski resorts in Switzerland that welcomed tourists. So not only were hotels being built in the cities, they were also starting to be built in mountains and obviously ski resorts were developing. In 1931, the Waldorf Astoria opened in New York. So even the worldwide depression did not prevent the construction of the famous Waldorf Astoria. In the 1950s, the Club Med... Resorts revolutionised the all-inclusive concept. So and if you remember from the airline industry timeline, you'll also notice that's also the first commercial airline was in 1952, so it kind of coincides with that as well. 1960s, we saw a lot of new tourists flourished around the Mediterranean. So Mediterranean, if you're not familiar with the Mediterranean, great with geography is the Mediterranean Sea is basically around Spain, Greece, from the Balearics to Yugoslavia at the time. So numerous city and beach hotels open their doors to summer guests keen for relaxation and a good dose of sunshine. So yeah, so good idea to get familiar with where all these regions are as well. So 1970s was the introduction of hotels for the business purposes. They started to open. So the movement for business hotels was supported by several factors. So first of all, there was the will of the airline companies to extend their efforts in the domain of hotels, so they started building hotels near airports. And there was also the sudden prosperity of black gold, also known as oil, of Middle Eastern countries, which attracted business people from all over the world. So this initiated growth in places like Abu Dhabi and Dubai in the United Arab Emirates. In the 1970s, also saw China open its doors to foreign tourists and hotels continue to develop and started to transform to a more guest-focused offering. All right. Let's jump to 1990 now where international hotel chains expanded through the US, Europe and the Middle East and also into Asia and also technology significantly improved operations and booking access in the hotel industry. Early 2000s is where sort of like the green movement began to safeguard the industry. So kind of like the introduction of eco-friendly hotels and environmental initiatives began in that era. Also loyalty programs continued to expand in the hope of owning the guest, I suppose, and really getting that, you know, reward cards and things like that. 2008 was interesting because it's when Airbnb, caused major major disruption to the industry so I guess they're considered a disruptor to the hotel industry where because because they offer an alternative sometimes cheaper or often cheaper and more suitable solution for some customers holidays so they do claim that they're not taking a piece of the pie but they're making the pie bigger so if you think about more people traveling more accommodation options available then more people can travel to that destination and maybe even travel more often and more more frequently if it's if it's more affordable Now by 2010-ish the travel is becoming more aware and demanding with their needs and accommodation providers are having to deliver and adapt. So the rise of the contact solutions, which have only been sped up obviously due to the pandemic as well, but they sort of started around 2011. Facial recognition came in in 2015. And we had then obviously increase in smart amenities, virtual realities and robots kind of in the last few years as well. So you will learn more about some of those technologies in our TSE subject, which is travel systems essentials. Right. So that is evolution of the accommodation industry in a nutshell. Some of the trends that are making an impact on the accommodation sector include seamless technologies. So hotels are more aware of that seamless transition and that need for that seamless transition for guests. So instead of the sort of three distinct stages of booking, you know, of, you know, searching, booking and staying, hotels are now implementing technology that sort of automate and streamline the entire guest experience from start to finish. From hotel profiles on websites to optimise direct booking engines and also on, you know, one click. check in and check out functionalities so it's kind of all in one place the millennial travellers so millennials um are the largest generation and also one of the biggest um target audiences for the hotel industry because they represent a large chunk of the market. And with the changing of this generation, people of this age group, so we're talking at the moment probably, you know, anywhere so from 22 to 42 or something like that, depending on which website you're looking at, they have different expectations and needs when it comes to travel. So much that hotels have had to listen and adapt, you know, their then, you know, offerings, I guess. So an example of that would be Marriott's Aloft brand, which I know that there's one in Perth. They have, those hotels have rooms with more contemporary designs, common areas to encourage social interaction. They use innovative programming, centring on music, art, design, as well as latest technology. They also have a thing called Roomcast. I'm not sure if you've heard that before, but it's a technology that allows guests to scream, to stream media. from Netflix, YouTube or other channels directly into their hotel room. There's also demand for personalisation in hotels as well. So hotels are looking at guests as individuals, not just a name on a register. So aspects of personalisation include gaining information from the customer in order to tailor make their stay that suits their own unique needs. So these include personal preferences, including food and music. So, for example, imagine how great it would be. If you arrive in your room, the temperature is just how you like it, not too hot, not too cold. You had your favourite coffee pod sitting beside the coffee machine, the perfect pillow, and within minutes room service delivers your favourite meal, you know, to your room, all while your favourite songs are playing in the background. So that's just a bit of an idea of how you can personalise a guest experience at a hotel. There's also a big focus on wellbeing, so that's a bit of a travel trend as well. So travellers have two distinct needs around wellbeing travel. So they can either use trips as a primary means to focus on their health and or maintaining healthy habits during physical vacations and business trips. So it can either be a trip for wellness and purely wellness or it's a bit of a secondary. So when they're on a holiday, they actually want a factor of, you know, a little bit of wellness, might be a massage or do a yoga class or something like that. Okay. So, you know, and the trend is seeing that, you know, people will book hotels based on those offerings of health and wellbeing facilities. And if hotels don't adapt and have these features, then they're going to be left behind. So the growth in importance of wellness has also seen a profound change in what hotels offer guests. There's also an increase of international guests. So as the global traveller pool grows, so do the number of attractive destinations competing for their dollars. So hotels and... and airlines due to continue to expand supply in promising growing markets while destination markets fine-tune digital and social strategies helping them to tap into rising global demand for the off the beaten path experiences so for example from 2009 to 2017 the us hotel gross bookings grew from 116 billion dollars to 185 billion so there's massive a lot of growth lots more international guests Ecological initiatives, so travellers are being more aware of their carbon footprint, so they want to minimise that where possible, and are booking rooms and hotels with the same value. So, you know, things that might be immediately visible to guests, such as responsibly sourced toiletries or locally sourced toiletries, lights and air conditioning that switch off automatically when you're not in the room, a towel reuse policy, so you leave the towel on the floor if you want it changed or you hang it up if you want to use it again. And also there are things that are happening behind the scenes as well, such as, you know, going paperless with, you know, cloud based property management systems and, you know, hotels are going green on several fronts. They might have solar power or, you know, something like that. You know, they might have battery, you know, batteries that, you know, power their hotel, you know, solar power batteries, that sort of thing. Explosion of social media. I think that's pretty self explanatory there. But. Travellers are using social media to check reviews before booking and they're using more travel apps as part of their booking process as well. So obviously keeping up to date with social media, making sure you have a Facebook page or an Instagram page as a hotel so that you can capture that market as well. All right. So the Accommodation Association is basically Australia's leading accommodation industry representative. And some of their goals include keeping the hotel market competitive. Regulating paying conditions for employees, proposing and supporting changes to laws regarding the accommodation sector. So this is a really good place to research the hotel sector if that's the one that you've chosen for assessment three. All right. So you may have heard us talk a little bit about the Accor Hotel Group previously. We have an Accor Hotel Program, so some of our students may be on this program. But they are one of the largest hotel groups in the world, and you can see from the slide all the different brands that fall under the Accor Group umbrella, and many of the brands can be found in Australia. So four popular and distinct brands that fall under that Accor. banner are Peppers, Mantra, Art Series Hotels and Break Free. So maybe you've stayed in one of these hotels before. Just to give you a little bit of a summary of the different brands. So Peppers is generally resort style, they are generally five star luxury, they have a range of different room types so from studios to two bedroom apartments or three bedroom apartments and they're mainly located in coastal or regional areas. And examples a Peppers Blue on Blue Resort at Magnetic Island, you've got Peppers Kingscliff in Northern New South Wales and there's quite a lot of them on the Gold Coast as well so Peppers Broad Beach, Peppers Soul in Surfers Paradise and there's also some in New Zealand as well Peppers on the Point in Rotorua, even in Canberra there is a Peppers Gallery Hotel as well so they're sort of I guess the top of the range if you're looking at those four different brands. Then we have Mantra, So Mantra have a corporate and leisure clientele so they you know I suppose the they have corporate would probably be more in the city and leisure would be more on the regional or coastal areas so they're generally rated about four star and they do have a range of room types as well from studio to two bedroom interconnecting rooms you know suitable for lots of different configurations So you've got the Mantra Club Crocodile in Ellie Beach. You've got Mantra Harvey Bay. You've got Mantra Hindmarsh Square in Adelaide. Mantra Charles Hotel in Launceston. Mantra Geraldton in WA, just to name a few. There's heaps of them on the Gold Coast as well. Break Free is the next brand, which is, again, corporate and leisure clientele in city-based hotels and leisure clientele in regional coastal areas, similar to the Mantra, except they're sort of a little bit more budget. So three to three and a half star, family friendly, and they do also have the same sort of room types such as studios and two bedrooms and things like that. They're just a little bit more budget, I guess, and three to three and a half star, so perhaps less facilities and not as, you know, nice as the mantra. So Art Series is a corporate and leisure clientele, again, in city-based hotels. They're a bit more of a boutique style. So there's a real... hotel experience a little extraordinary they focus on art um and they take the you know I suppose each hotel takes the design of a local artist or um or the namesake artist so examples are the Johnson Brisbane in Spring Hill uh the Cullen in um Prahn in Melbourne the Olsen in South Yarra in Melbourne there's the Watson in Walkerville in Adelaide um and just there's a couple of other ones around as well so So, yeah, so I guess brands to just get familiar with, you know, because they are quite common in a lot of places in Australia. So please take time to read through this summary slide because this will really help you to recap on your learning from this module. And don't forget that Assessment 1B quiz is your next one for this subject and it will be open during Week 8 for completion and covers contents in this module and Module 4. So a reminder that as well as reading. all the essential resources please ensure that you've also completed the discussion forums and the learning activities to set yourself up for the best chance of success. But that's it from me, thanks for watching and next up in module four in week seven and eight we'll be focusing on cruise and tour sectors. Look forward to seeing you then, bye.

So whether you're on the Whitsundays hotel program, you know, going up to work in one of the hotels up there or if you're in a core hotel program as well. So So the aim of this video, I suppose it's a video lecture, is to give you a little bit more of an insight into the module, to give you some examples and just, I guess, so that you can help better understand the context of this one. So please ensure that you're also participating in the discussion forums in Blackboard, completing the learning activities because there's lots of cool little things in there to check your knowledge on that, as well as reading the essential resources or watching the videos that we've put in there as well. So this module should be completed by the end of week six so hopefully on track for that and information from this module as well as module four which is your next one will be in your next quiz which is assessment 1b and that is due at the end of week eight so you can check your assessment section in the left hand side of your blackboard for the exact dates that that will be open for your intake and you'll also find in there your assessment briefs with lots of instructions.

as well as the assessment overview videos as well that you can watch there. Alrighty, so let's have a look at what we'll be covering this module, okay. So throughout this video, I'm going to give you a very high level overview of some key terminology that's used in the airline industry and the accommodation industry. We'll be looking at some strategies the airlines use, such as hub cities and airfare pricing. I'm also going to review information about aircraft and airline cabin classes, and I'll tell you how to find that information as well.

I'll show you how to find it. I'll also briefly discuss the various types of accommodation that are in the market and the evolution of both the airline and the accommodation sectors with significant events that have occurred that have helped to shape and change those two sectors. So we've also got a live tutorial for Module 3. So please check collaborate or your student schedule for those dates where we're going to be doing some interactive activities that will help to build on this knowledge. So hopefully you'll be able to attend those sessions as well.

So let's jump into the airline sector first of all. OK, so there's a little quote on the slide here, which says the airline industry quickly grew from one single aircraft, one route and one lone passenger. So today, aviation is the lifeblood of the global economy.

The industry supports. over 58 million jobs and 2.4 trillion in annual economic activity so you can sort of see how quickly and how fast that has grown if you remember 1952 was the first commercial airline so we're now fast forwarded to 2023 and this is what it looks like so the airline industry is a very significant sector within the wider travel and tourism industry and so without it it would be really difficult to get to a lot of the destinations that we travel to so it is quite important And having a good understanding of airlines helps in becoming a successful travel consultant or an airline industry employee, if that's what your career goals are. So the airline industry has seen massive growth in passenger numbers and they're expected to grow to record numbers in the set of the next 10 to 20 years. So which is great for jobs in the travel industry, not only in the airline sector, but also in hotels.

travel agencies tours you name it because pretty much if the airline industry grows everything else grows as well so let's have a look at some terminology now um for the airline industry so um some of these you may have heard of and some might be brand new so obviously you're going to have different levels of knowledge prior knowledge so we can draw on that but also we've tried to cover ones that you may not necessarily know of so um Yeah, so you might have researched or taken a flight somewhere. So hopefully there's some things that you do learn that you didn't already know. So the first one we've got there is fare aggregators. So these are websites that are basically search engines. So they search a huge amount of data from other websites, which helps customers to find and compare airfares between two city pairs.

So an example of a fare aggregator is Skyscanner. So which is there's a little bit of an example on the on the slide there. So you can jump onto Skyscanner and you can put in some really basic search criteria such as dates, origin and destination.

And then you press search and you're basically going to get a plethora of airfare options, usually listed by the cheapest. So it then provides you with a link on where you can book it. For example, it might direct you to the airline website or it could direct you to the OTA or an OTA, so an online travel agent or a booking site.

So there are, of course. some pros and cons of using an aggregator. So some of the positives are that it is very quick and easy.

It's a real quick and easy way to get an idea of how much a flight would be to your chosen destination and provides you with some website options that you can book on. It can also save you the time and hassle of having to search lots of individual sites yourself. However, there are some disadvantages that I just want everyone to be aware of, I guess, of these aggregators.

So for example, if you're using the basic search method, so It won't factor in your preferences such as direct flights or it won't eliminate lengthy stopovers. So it might bring back the cheapest airfare. Say, for example, it might be a flight from Brisbane to Los Angeles that you're looking for. But the cheapest option involves a night in overnight in Sydney. So, you know, it has a flight that gets, you know, gets in from Brisbane to Sydney overnight and then leaves the next day, which isn't ideal.

And obviously. you know you might be able to pay another 50 to 100 and actually get a direct flight straight from Brisbane to Los Angeles so um so because it's a it's an artificial intelligence it's not a human um booking it sometimes you know it just gets you gives you what you ask it for the cheapest option which um sometimes can cost you more if you have to pay for a night in Sydney for example and also not to mention the time saved by going on the direct flight so it also doesn't understand what's most important to your customer or to you as a traveler So this could be frequent flyer points or it could be the time of day that you want to travel or how many stopovers you want or even if you want to stop you know or where you want to stop. So it can also bring up several one-way flights or sectors that make up the airfare so you might have one way with Jetstar, one way with Hawaiian Airlines or something like that so meaning that you might need to switch airlines and potentially recheck your bags if it's booked several sectors.

Or if you need to change your flights for whatever reason, you may be up for two to three different lots of change fees or cancellation fees costing you more in the long run. But if you don't mind booking with two to three airlines, that's fine. Some people might say, well, that's okay, I'm going to leave tomorrow and I want to book two or three airlines, I'm not going to be changing, all of that.

You do need to be mindful that if one airline has a date or time change, and this does happen a lot in the airline industry, it's going to be a lot of time. then the other one may not necessarily be connected or interline with that airline. So you might miss the connecting flight or you might need to pay the change fees to change the other flight to match with the other one. So it's all right if you're spending overnight somewhere. That's not too bad because you can allow for time changes.

And obviously you're going to be checking your bags and collecting your bags and checking them back in and things like that. So, of course, with a little FA knowledge, you can manipulate those search functions to filter out the best flights. But. most customers won't know how to do this.

So moral of the story, fare aggregators are great for quick searches and to get an idea of prices, particularly when you're in the planning stage of that customer journey that we talked about in module one. But it's best to use a travel consultant or an airfare expert to actually book it just to make sure that you're getting the best fare. So the next one on the list there is a full service airline.

So this is Just as the name suggests, it's an airline that offers full service. So this generally is, but not always, includes your ticket, your seat selection, checked baggage, meals, beverages and things like pillows and blankets. So this is obviously we're talking international flights mainly.

So the opposite of full service airlines are low cost carriers, which I'll chat about in a minute. But some examples of full service airlines when flying internationally from Australia include Qantas, Virgin Australia, Emirates. Air New Zealand, Qatar, Singapore Airlines, just to name a few.

All right, so maybe you've had some experience on a full-service airline. previously um or you might have had some experience on a low-cost carrier as well um and look there's no real right or wrong for which ones are the best um it really just comes down to what's most important to the customer so you know if you're not needing um to take baggage or you don't really want a meal or um things like that then a low-cost carrier might be the best option for someone whereas if you are needing um you know a uh you know you wanted to you've got a few people traveling together and you need that seat selection you're traveling with bags and things like that then the full service airline might be the best option so it really just depends on what's most important so the next one that we have there is IATA so you might have heard us talk about IATA previously but it stands for International Air Transport Association and they're basically the trade association or governing body for the airline industry so they're responsible for things like standardizing airline safety and security and for coordinating global airline policies and procedures you So they represent about 300 airlines or 83% of the total air traffic worldwide. So they're pretty big.

Low-cost carriers, as I mentioned before, are the opposite of the full-service airlines. So they offer cheaper airfares than the full-service airlines generally, not always, but operate more on a user pays systems. So they generally have lower fares and fewer inclusions.

So customers can then decide if they want to pay for extra things like checked baggage, seat selection, meals, beverages. um priority boarding all of those sorts of things so some examples of lccs um are jetstar air asia euro wings scoot and we've just had a new addition to the australian domestic market which is bonza airlines so which you might have heard of in the news cool so that is another one let's go to the next one which is further terminology so preferred supplier agreement okay so often travel companies such as flight center we'll have what we call preferred suppliers or a preferred supplier agreement with other companies and sectors in the travel industry. So for example, we might have a preferred wholesaler, we might have preferred airlines or hotel brands that we would recommend. Okay, so in exchange for sales, the company then offer a flight centre a more competitive price, kind of like a bulk buying power and better support for things like product training and reps and um, Other benefits such as higher commission or marketing sponsorship for things like awards and expos.

So kind of like the old saying, I'll scratch your back if you scratch mine. And the relationship is designed to be mutually beneficial. So it does exist in other industries too.

So, for example, in the grocery industry, Carl's and Woolies, for example, would have preferred suppliers for their meat and their fruit and veg. And the more they purchase through one wholesaler or preferred supplier. the cheaper they get it for, which means that they would have more competitive prices to pass on to the customers, or they can also make maybe more profit margin as well.

So there's obviously some good benefits there, but that's often a term used in the travel industry. Okay, so revenue management is, obviously in the airline department, it's basically a group of people that are responsible for maximising revenue or sales of airline seats. So airline revenue managers adjust the fares, you know, they can do it on a daily basis, but you know generally throughout the year depending on things like the route, the season and also supply and demand.

So their aim is to maximise the revenue for the airlines, so sell as many seats as possible, which is why the general rule of thumb is that the earlier you book, the cheaper the airfares will be. So flights are not filling up as fast as they'd hoped, they might offer sale fares or happy hour fares to try and to sell those emptier flights. So the more full a flight becomes, the more demand there is for it.

And so the airline can charge a higher price. So I will talk more a little bit about in a little bit of a moment about the different factors that can impact the cost of an airfare as well. We have a look at airfare pricing. The terminology of traffic is as tend. We tend to use it mainly by airlines, I guess, to describe the passengers carried on a plane.

So high traffic demand is where there are more people. who want to travel on a specific date or route than there are flights for. So that's just a little bit of a explanation there on those. All right. So now let's take a look at hub cities.

All right. So I hope I can explain this concept of this strategy here a little bit. So hub cities are or every airline has a hub city. OK, so and that airline needs to travel through that hub city whenever they leave their home port and go to another destination. They do need to.

or their home port is their hub city I suppose so whenever they they leave from another destination to another destination they have to go through their their hub city so if you imagine a wheel where you have the hub in the middle and the spokes coming out from the hub so each spoke represents an origin and a destination and the hub is the city or the airport it needs to fly via okay so this is what is known as the hub and spoke system in the airline industry and it was invented to maximize route viability so to create more efficient routes and bigger flight networks for the airlines without having to increase the number of aircraft so as i mentioned every airline has a hub city for example singapore airlines their hub city is singapore so every flight that goes from a to b needs to fly via Singapore, well that is flying with Singapore Airlines goes via Singapore. So Thai Airways, they fly via Bangkok, Malaysian Airlines fly via Kuala Lumpur, Emirates fly via Dubai, etc. So if you were flying from Sydney to London, let's say with Emirates, the route you would take would be Sydney, Dubai, London, and then you'd come back the same way back through Dubai, back to Sydney. So you might be thinking, Why do I need to know this?

Okay, so it is useful to know there are a few reasons. Firstly, if someone wants to stop over on their way to a destination, knowing which airlines stop in which cities can help you to recommend the best airline for them. Or you might have a customer that's wanting to go to two different destinations. So using the two airlines that have the two destinations as their hub cities can actually help you to create the best way to travel for them. And when I say the best way, I mean all in one ticket, which means that you have to go to the right place.

you know, everything sort of covered the whole itinerary within one ticket. So, for example, let's have a look at the example that we've got up on the screen there as well. Leaving from Sydney and you want to go to Tokyo and Singapore.

OK, so, yes, sure, you can find one way flights with different lots of with, you know, different airlines from Sydney to Tokyo, Tokyo to Singapore and then Singapore to Sydney. But it's likely to be much more expensive than booking one return fare. okay that allows you to do all the flights in one ticket which is which is the goal so if you book um also if you book the three individual tickets they'll also have three lots of changes and cancellation fees so if you do need to make those amendments or um changes to your travel plans down the track that can actually cost more as well okay so if we use that exact example let me explain this a little bit more so let's say travel wants to go to singapore and tokyo singapore is the hub city for singapore airlines and Tokyo is the hub city for Japan Airlines so we would look at Japan Airlines okay so let's say they wanted to stop in Singapore first then Tokyo if you have a look at the the slide there we've got the stop represented there as a circle and the transit represented as an x so you can sort of see the itinerary that they want to do there and just so you know every airport has a three letter city code and every airline has a two letter airline code as well so they're things that are good to get to know as if you are working in particularly booking travel as a travel consultant. So if we were to then do searches in our GDS system, so in Sabre for example if you work for Flight Centre, you would do two airfare searches.

So one would be with Singapore Airlines and you'd do it from Sydney to Tokyo because you know you're going to go via Singapore and the other one is going to be with Japan Airlines but your search would be from Sydney to Singapore because you're going to go via Tokyo. All right so two different searches. So then the one with Singapore Airlines will go Sydney, Singapore, Tokyo.

Tokyo would be the point of turnaround there and then come back via Singapore to Sydney. OK, let's say that comes back around $1,200, including taxes, just to pull a figure out of my head. All right. And then the one with Japan Airlines will go from Sydney to Tokyo and then to Singapore, which is your point of turnaround. So you go Sydney, Tokyo, Singapore, excuse me, and then you go come back via Tokyo and back.

to Sydney and let's say that one is 1190 so there's not much in it in terms of prices so if there isn't a lot of difference in price and or if that's not that important to your customer if you know your Asian geography well you'll know that Japan is further north than Singapore so it would make more geographical sense to go with Singapore Airlines in this instance as there'll be less flying time and miles traveled so hopefully that makes sense there all right so So as mentioned before, revenue management is a way for airlines to maximise their revenues for their seats that they've got on their aircrafts. So let's have a think about some of the reasons that airlines offer different prices within the same cabin class. OK, so they could be for lots and lots of different reasons. So as I mentioned before, availability. So the full of the flight, the more expensive it usually is.

There could also be some advanced purchase restrictions on the ticket. So, for example. If you purchased it 21 days in advance, so more than 21 days in advance, it might be cheaper than if you booked it last minute.

as we mentioned before the inclusion so whether it's a low-cost carrier or a full-service airline so some fares include baggage some don't so that can factor the the prices of affairs of airfares it could also be the conditions of the fare so is it non-refundable or is it flexible you know so some airline affairs um you know it's free to change um there's no you know um there's no change fees there's no um cancellation fees it's refundable Some of them are completely non-refundable. Some of them you do have to pay to change and pay a fair difference as well. It could also be the timing of the flight. So your early morning flights, sometimes the red-eye flights tend to be cheaper because they're less popular, which can also relate to availability and that supply and demand factor as well.

It could also be the class of travel that you're travelling in, so whether that's economy, premium economy, business or first, which I'll speak about a little bit more as well later. It could be the timing of your purchase. So you could have booked it as an early bird package or at the travel expo or it could be last minute.

So it could be a lot more expensive. You've also got different fares. So, you know, you've got different booking classes for different fares. So that could be special fares for student types such as students or seniors or companion fares. So there's lots of different factors.

Another, I suppose, another really important factor is that. the time of the year that you're traveling or if there's an event on so school holidays are usually more expensive than if you're traveling outside of school holidays so things like Christmas and Easter tend to be more expensive than no holiday period and if there's an event on so if it's an Olympics or Commonwealth Games or Grand Prix or something like that then our flights will tend to be more expensive because again there's that supply and demand factor all right so lots of different factors there. might explain why you're sitting next to someone on the same exact same flight and you've paid you know half the price that they have or they might have paid half that what you've paid so just helps to explain that um a little bit of a travel agent's uh you know not not nightmare but challenge when airfares are constantly changing and you know customers sometimes don't understand why they can't get the the airfare that's advertised for 99 or something like that on on you know the day before christmas or something like that so It's just a matter of, you know, setting up expectations when we're chatting to our customers. So when it comes to the airline industry, there are many different types of aircraft out there. So they're all different sizes, seating configurations, and they all have different features.

So as you can see, they go from the really big ones, you know, the A380s down to the little ones. So you will have, you know, some people that have some customers that are very much. airline nerds out there so um but as someone working in the travel and tourism industry you're not expected to know all of the facts and figures and memorize them of every aircraft but it's important to recognize that the planes are not all identical um and also where you can go to find out this information so obviously you've got a gds system that you'll be familiar with and there'll be certain information that you can find um out about the the flight that you're you've booked or you've quoted um so you can go by booking number it'll tell you what aircraft type it is um And then you can do further research so you can go to the airline's website. But there's a really cool little website that I wanted to share with you. It's called seatguru.com, www.seatguru.com.

And it's a really good tool to be able to sort of have a search. You might be wanting to sort of check what the seating configuration is on an A380. So this might be important to families who are wanting to sit close together on a flight or You might want to find out. And they've got, like, reviews as well, so you might want to find out which are the best seats and which ones to avoid, you know, the ones that have no recline or they might be really close to the toilets and things like that.

So you might also be wanting to know which airlines offer premium economy because not all airlines have every class of cabin available. So you might want to find out which ones actually have premium economy or which ones have business or which ones, you know, have that recliner or the lie flatbed. you know so it's got a lot of information in there it's kind of a bit like a TripAdvisor I think it is actually powered by TripAdvisor for the airline industry so I encourage you to jump on and have a look at SeatGuru have a bit of a play with information what you can find on the site so they've got seat maps they've got airline comparison tools so it can be a really great tool when you're asked questions about aircraft types when you're working in the industry all right you So speaking of different cabin classes before there are four main types but as I mentioned before and also it's on the slide there not all airlines will have all four classes of service so they might have a combination so you might have some with economy and business economy and premium and business or you might have economy business and first for example so um what are the main differences let's have a look firstly the price so um it's a case of you get what you pay for so economy which generally has the least leg room and least inclusions but it is usually generally the cheapest and the most affordable um some people will also affectionately call it cattle class um a bit of a you know funny name for it um Premium economy class is a good compromise between business and economy. So if you're not prepared to fork out for the business class airfare, but you want extra benefits such as a bit of a bigger seat, better service, extra leg room, a private section in the plane, like in the cabin, you might get a nicer meal, better wine selection. Premium economy might be a great option for it's a bit of a compromise.

So business class, so as well as the luxury of either a lie flat. bed or recliner seat. You'll also receive, you know, restaurant quality meals, you know, chef inspired, better selection of drinks, priority boarding, access to business class lounges when available. And you've got obviously more crew to a smaller amount of customers or passengers. So some airlines even offer a chauffeur drive transfer as part of their business class ticket.

So, you know, you can get a chauffeur. Basically, it's a transfer that picks you up from home, takes you to the airport and then from your airport to your hotel at your destinations as well. So first class now as business class is now so good.

Some airlines don't even have first class anymore as an option. But first class not only offers all the benefits of the business class cabin. It also takes it up a notch even further with closed suites, private bathrooms, butler service. even more luxurious amenities and that sort of thing.

So I'm going to now play you a short video with just, it's basically Emirates A380 Airbus. So they offer economy, business and first class. And it will just show you a little bit about what these different classes look like on Emirates. Welcome aboard our Emirates 3 class A380.

Thank you for visiting us on our brand new Free Class A380. How good do those suites look? Oh, it makes me want to travel.

I love those little minibars as well, personal minibars right next to your seat. How good is that? All right.

So let's jump back in now and continue. We're going to have a look at the evolution. So we've talked about the evolution of the travel industry in general, so in Module 2. So what we're going to have a look at now is the evolution of travel. the airline industry.

Okay, so some key observations here, you can have a look at the timeline here, but overall the cost of airfares, which is measured in weeks of pay on the timeline here, has dramatically reduced over the years. So this is due to things like bigger planes, more competition, so more airlines, more efficient aircraft, advancements in technology, more connected cities and more people flying. So That has definitely helped to bring the cost of airfares down in a relative scale.

So what once cost 85 weeks of pay to fly from Australia to London in the 1950s now equates to around one, one and a half weeks pay in current times. So a major year in the airline's history is 1952, which was the emergence of passenger planes for commercial aviation. So the first routes were from London in the UK.

to Johannesburg in South Africa and also to Colombo in Sri Lanka. So as you can see from the timeline, the number of people travelling from Australia, also known as Australian outbound departures, has increased dramatically over the years. So from 161,000 in 1965 to exceeding 10.5 million in more recent years.

The 70s also saw a bit of development in the airline industry with the wide body jumbo jets, which enabled the airline. to expand their capacity. And also there was the first supersonic jet, the Concorde, which made its first transatlantic crossing in 1973. So they were only ever manufactured for Air France and British Airways and they ceased flying in 2003, saying it was due to low numbers and rising maintenance costs. But it also followed a nasty crash in Paris in July of 2000 as well.

So... They just were not really economically viable to have anymore. But I guess, you know, in the future we are looking at, you know, the comeback of the supersonic travel, you know, faster planes.

I think it just wasn't worth it for the amount of money extra that they were charging. It wasn't worth it. So 1978 also marks a pretty important year.

This was the year that deregulation occurred in the airline industry in the US. So... deregulation is basically the removal of government or federal control over airline regulations such as fares, routes and also the entry of new airlines. So there are always going to be pros and cons to consider.

So for example, it did stimulate a lot of economic growth and increased competition. A lot more airlines were able to enter the market. But, you know, so that obviously made it more accessible for more people and more affordable.

But the downside is that it can. you know, create issues with things like standard control, that sort of thing. So in the 1980s, this is where we sort of had the entry of that low-cost carrier or the no-frills airlines to the markets, which we spoke about earlier.

1990s was when the hub and spoke system was introduced to assist airlines in that route viability and network offerings that I spoke of earlier. Interestingly, in the... In the late 1990s, airlines actually expanded their fleet due to rising oil prices, technology advancements and economic changes. So, you know, when something does happen within the world, you know, that can have an impact on the, you know, the airline industry sectors and other sectors as well. So events such as the terrorist attacks in New York, September 11, 2001, impacted airline security and operations.

So. That's why now you can't take, you know, sharps on board or you have increased security through airports. In late 2000s, new long-haul aircraft were introduced, so being able to travel longer distances.

Also Qantas started experimenting in sort of the late 2010s, if that's a thing, with new anti-jet lag services. for passengers so things like you know dimming the light you know changing the lights to how your destination you know what it's like at your destination and all those sorts of things you know just to try and reduce jet lag for customers and then obviously in the most recent years we've had a COVID-19 pandemic which has had a dramatic impact on the airline industry. Obviously lots of flights and aircraft were grounded.

They all went to, you know, sort of have a bit of a rest for a few years and, you know, if we have a look at, you know, I suppose 2022 is kind of like the start of that recovery, you know, and, you know, we see a real, like I suppose we're going to see lots of demand for, you know. airlines and flights and whatever as the world reopens. So and IATA obviously you know has some forecasts there and a recovery plan in place for the airline industry.

So speaking of IATA again hopefully you remember from the terminology section what it stands for. So just to recap International Air Transport Association and their main objective is to govern safety, security, efficiency and sustainability for their members. So if you are researching information on the airline industry, so you might choose the airline sector for your Assessment 3 for TTI, a good resource is the IATA website or any reports that they do publish.

So there is some further information on what they do listed here on the slide as well as a link to their website. So many travel companies, especially airlines, they use IATA forecasts to help them make critical business decisions such as the purchase of new aircraft. what destinations to travel to, as well as how many staff they might need to employ and trains. Obviously you need to plan for those sorts of things. So according to IATA forecasts, by 2025, the top three countries to be the world's largest aviation markets are going to be China, India and the USA.

Which kind of makes sense since these are the countries either with the highest population or the strongest economic growth. Okay, so they're going to have the largest aviation, so basically the largest number of flights within those countries. All right, so there are many trends that are impacting the airline industry. So some of them are technological, some of them are environmental, and others will be behavioural or legal, political. So, you know, it's worth having a look at these.

These might be trends that you choose, again, for your assessment three, but you'll be able to find more information using these sources here. or even just do your own research in terms of some of these trends. So as you can see, some of them will be, you know, linked to the environment. Some of them will be linked to technology.

Others might be behavioural, you know, and because of the pandemic and, you know, that sort of thing. So definitely, you know, come back to this slide when you're looking at trends for Assessment 3 if you're doing the airline industry. All right.

So a good airline to learn more about as well, which is a good start. is Australia's largest domestic and international airline. So I encourage you to do some independent research on Qantas.

So, you know, find out who they are, where they fly to, so what's their network. I mean, there's a little bit of a map there, but, you know, really delve into their website. Do they have a frequent flyer program? Is it free to join?

What inclusions do you get on board, you know, when you're travelling internationally? You know, how much baggage do you get included? You know, things like that. Do they all have, do they have all the cabin classes? you know which ones do they have do they have business and first or premium economy what aircraft do they use um you know often airlines will have like a certain fleet of aircraft like they might have the you know the 747s or the the a380s and that sort of thing just be good to get to know a little bit about the um the the airline um do they have business class lounges in which case which cities um do they have any any affiliation with any other airlines as well So there is also an airline activity in the Module 3 discussion forum that asks you to choose an airline and do some research and find out the answers to a few of the questions there.

So it's a great way to start exploring your product knowledge on the airlines. And, you know, I suppose a good place to start is to start with, you know, some of the more common ones from Australia and then start to build on that knowledge. You know, find out, you know, where their hub cities are and things like that.

So we're now going to move on to the second part of this module, which is all about the accommodation sector. OK, so there's a little quote here from Rebecca Gross. So she says hotels are no longer just a place to stay, but rather have become lively and connected destinations for visitors and locals alike.

As trends in the travel industry have shifted, large and small hospitality brands have reacted and adapted to new generation of hotels. All right. So what she's talking about, obviously, in the.

in terms of trends in the travelling industry shifting, she's saying that hotels are adapting to trends and also, which talks about that generation, that newer generation, I suppose, she's talking about like the millennials and even Gen Z that are coming through. Also other trends that hotels are having to adapt to are environmental trends, so sustainable tourism and eco-hotels and things like that. Also behavioural trends.

they would need to adapt to those so things like the wellness trend and uh families you know like multi-generational families and also pleasure and people doing workations and things like that so um then you've also got your technological trends um so things like travel apps biometrics artificial intelligence robotics all of those sorts of things we will talk a little bit more about trends um a lot more about trends in module six as well Alright, so let's have a look at some of the terminology used in the accommodation industry. So some of the terminology might be familiar to you, especially if you've ever worked in a hotel or even stayed in a hotel. So I'll just run through them quickly and give you some examples where needed.

So affiliated hotel, this is a hotel that is part of a group of hotels operated by the same company. So there are many examples here, including Accor, Marriott, Hilton, Starwood, etc. So many hotels belong to a chain of hotels.

and they are then part of a group of hotels so they're known as affiliated okay they're kind of related so the term allotment is used to describe any block of rooms at a special negotiated rate that a hotel has given to another party such as a wholesaler or tour operator that they can then on sell to their customers so this um i guess the benefit of this is that means the wholesaler or the tour company can freely sell those rooms without having to check availability um each time so they kind of guaranteed those rooms For example, Contiki has a set of itinerary, basically set itineraries that they do their group tours for, you know, they can have up to 50 people on their tour. So they need to know for sure that they can stay at those hotels that are listed on their itineraries and on the dates that they're in those cities. So they're given an allotment and then there would be a certain time that they would have to release them back to the hotel for them to sell. So if they haven't been sold or used.

So. Contracts will get renewed each year kind of and reviewed depending on sales. So obviously if you don't sell your allotment, you might not get as much next time. And if the wholesaler or tool company has released the rooms back, they need to then request availability if they want to sell it after they've released it back. So that's why sometimes hotels will have no availability showing on their website, but a travel agent may be able to access availability through one of their wholesaler's allotments.

So I once had a lady who came to me asking for some accommodation near the Lakes Resort in Cairns. So she wanted to find out which hotels were close by because her family was staying there for her brother's 40th. And she had tried to book online at the same resort, but all the two-bedroom apartments had been sold full.

So then I said, well, let me just check my wholesalers. So I contacted them and they had one room left, okay, through their allotment, even though it was showing. sold out on the um even the hotel's website was saying sold out but this particular wholesaler still had one hotel one room left as part of their allotment so I booked that for her and then she said that they actually needed another room for her sister so then I contacted another wholesaler and they had one room left so between the three kind of different sources she was able to get availability for her whole family to celebrate the 40th birthday there so that was kind of kind of a good um outcome there but you know I guess important to understand how allotments work.

Average room rate. Okay. So this is the average price of a hotel. Also the average price a hotel sells their rooms for.

Okay. So for example, they may have sold a thousand rooms for $200 per night and a thousand rooms for $250 a night, just to make the maths easy for me. So the average room rate would then be $225 per night.

So again, it's just the average of the price of a hotel room. Back of house. I like to think of this as a bit of a back of stage if you're thinking about a theatre where, you know, it's all the employees that are working in that area have very little contact with the hotel guests. They're kind of like not out on stage or anything like that. So examples would be, you know, someone working in the back office like the accountants or payroll or, you know, even reservations sit out the back sometimes.

But kitchen staff, housekeeping departments, that sort of thing. All right. So. Contract rooms.

So some hotels will have specially negotiated rates for travellers that frequent their hotel often. So it could be airline crew, it could be corporate travellers or even long-term business travellers. So the company is then invoiced for the accommodation after they've stayed and they usually get a better rate.

So it's kind of a contract rate or a contract room. All right. Now the opposite of back of house is front of house. And this is like the people that are kind of, I suppose, performing on stage, if you think of it as the analogy of the theatre.

The employees have extensive guest contacts such as front office, guest services agents, restaurant staff, the porters, etc. All right. So no show.

So this is an industry term for someone who had a confirmed booking at a hotel but then didn't arrive. So this could be obviously for a few reasons. So maybe they missed their flight so they didn't arrive in time and they didn't have a chance to let the hotel know. You know, they might have been delayed in the air.

They also may have made their booking like a non-refundable booking. So and if they could no longer travel, it's a change of circumstances, but instead of cancelling, they just left it because they weren't going to get a refund anyway. All right. So, yeah, I'll talk a little bit more about overbooking in a moment. But occupancy relates to the number of rooms that are occupied over a period of time.

So it could be a day, a year, a month, you know. So, for example, if a hotel has 200 rooms available on any one day and let's say 150 are occupied, then their occupancy for that day would be 75 percent. And when calculating it for a month or a year, you just need to look at the average occupancy rates.

OK. So some hotels overbook. Okay, so this is overbooking.

Some hotels will overbook, meaning that they take more or make more reservations for the number of rooms than they actually have. So especially if they can confidently bump guests to affiliated hotels, so you know what that means now, or you can offer them upgrades if necessary. So I suppose this is the hotel's way to maximise revenue and hedge their bets by looking at their average rate of no-shows that they get and saying, okay, well, we know that.

on average 5% of people no show. So we're going to overbook by 5%. So that way they can maximise their revenue there. All right.

Rack rate. So rack rate is just a term that is given to the highest rate for a specific room. So it's kind of like the full gross rate.

And often rates are discounted based on the rack rate. So for example, if you've got a membership with like the entertainment card or with RSEQ or RAA or something like that, which gives you a percentage off certain hotels, it's often off the rack rate and not the cheapest rate that you've found. Okay, so often I'd get customers asking me about that, saying, oh, I've got 50% off, so I'm going to go and book that through Entertainment Card. But then sometimes the specials or the last-minute rates can be even better than those deals as well.

So it's just, I guess, a matter of shopping around when you're looking for the cheapest rates for your accommodation. All right, so as you're probably aware, there are many different types of accommodation to suit many different customer needs. So, but we can't always assume that customers will always want to stay at the same type of accommodation for every holiday or not everyone will want the cheapest as well.

So, for example, I might be generally a four to five star type of customer. But, you know, on a road trip, I might be happy to stay at a motel because that might be the best option where you can just park. You know, you've got to just want to crash for the night, you know.

have access to your car you don't have to lug your luggage up and down stairs and elevators and things like that so that might be the best option for that particular reason but i potentially wouldn't stay there for a week you know um honeymooners might also spend more and want the luxury that a resort or a boutique hotel might provide you might have families that want an all inclusive resort with a kids club or they might want apartment style so they can save some money and do some cooking You know, they'll have a kitchen and cooking facilities there and perhaps a little bit larger space. Budget travellers or those travelling alone might choose a hostel, for example, to save money or maybe even to meet like-minded people. So if they're travelling alone, they might want to stay in a hostel so that they can meet other people, make some friends along the way.

And those conscious of minimising the impact on the environment may choose an eco hotel for those reasons as well. So lots of different types of accommodation. All right.

um there's a couple more there as well that you can have a look at there's you can read the descriptions on those on on your slides um all right so let's have a look at the evolution um so there are a couple of uh slides here that summarize the evolution of the accommodation sector so it starts uh back in i suppose then the 1950s not the 1950s the 1500s um which um where we had the french and the english law um required people to keep registries of, I guess, register, I guess, of people staying in inns or hotels as we know them now. So and a register is basically just an official list of hotel guest names. So, yeah, I guess that became a bit of a law back then.

So also around that same time, 1500s guidebooks began to appear detailing the best ofs in regards to a hotel's cleanliness and cuisine. So it's kind of like the first Lonely Planet-style walks or... an olden day trip advisor i guess when it comes to hotels um 1700s we saw hotel construction expand in europe and the us so this was the start of the industrial revolution so hopefully you remember that from module two um so in new york first of all then copenhagen hotels were established in city centers um early 1800s holiday resorts actually became popular along the french and italian rivieras so i actually learnt um probably way too late that Riviera is an Italian word for coastline because I used to always think it was something related to a river um so just FYI um the Holt Hotel in New York was also the first place to provide its guests with a lift for their luggage so you can imagine what it would have been like back then when you know you would have had to have probably had fairly low hotels there wouldn't have been big high-rises because you would have had stairs um to you know to have to take your luggage up um and you know think about you wouldn't have had electricity and hot water and also it's all those sorts of things probably had a potbelly stove that you had to heat your water up to have a bath you know those sorts of things so mid-1800s major hotel construction began during the industrial revolution as steam train increased access to travel so seaside resorts began to pop up as people escaped to city centres for the weekend so they wanted to escape the you know the cities and the factories and you know the the hustle and bustle So, yeah, so as train travel increased, so did seaside resorts.

In 1862, the Grand Hotel, which is the famous hotel in Paris, became the first truly modern hotel due to its grandeur and indoor lighting. So, yeah, that's, I suppose, you know, having electricity in a hotel was pretty cool back then. Now it's just an expectation. The 1920s was the first ski resorts in Switzerland that welcomed tourists. So not only were hotels being built in the cities, they were also starting to be built in mountains and obviously ski resorts were developing.

In 1931, the Waldorf Astoria opened in New York. So even the worldwide depression did not prevent the construction of the famous Waldorf Astoria. In the 1950s, the Club Med... Resorts revolutionised the all-inclusive concept.

So and if you remember from the airline industry timeline, you'll also notice that's also the first commercial airline was in 1952, so it kind of coincides with that as well. 1960s, we saw a lot of new tourists flourished around the Mediterranean. So Mediterranean, if you're not familiar with the Mediterranean, great with geography is the Mediterranean Sea is basically around Spain, Greece, from the Balearics to Yugoslavia at the time.

So numerous city and beach hotels open their doors to summer guests keen for relaxation and a good dose of sunshine. So yeah, so good idea to get familiar with where all these regions are as well. So 1970s was the introduction of hotels for the business purposes. They started to open.

So the movement for business hotels was supported by several factors. So first of all, there was the will of the airline companies to extend their efforts in the domain of hotels, so they started building hotels near airports. And there was also the sudden prosperity of black gold, also known as oil, of Middle Eastern countries, which attracted business people from all over the world.

So this initiated growth in places like Abu Dhabi and Dubai in the United Arab Emirates. In the 1970s, also saw China open its doors to foreign tourists and hotels continue to develop and started to transform to a more guest-focused offering. All right.

Let's jump to 1990 now where international hotel chains expanded through the US, Europe and the Middle East and also into Asia and also technology significantly improved operations and booking access in the hotel industry. Early 2000s is where sort of like the green movement began to safeguard the industry. So kind of like the introduction of eco-friendly hotels and environmental initiatives began in that era. Also loyalty programs continued to expand in the hope of owning the guest, I suppose, and really getting that, you know, reward cards and things like that.

2008 was interesting because it's when Airbnb, caused major major disruption to the industry so I guess they're considered a disruptor to the hotel industry where because because they offer an alternative sometimes cheaper or often cheaper and more suitable solution for some customers holidays so they do claim that they're not taking a piece of the pie but they're making the pie bigger so if you think about more people traveling more accommodation options available then more people can travel to that destination and maybe even travel more often and more more frequently if it's if it's more affordable Now by 2010-ish the travel is becoming more aware and demanding with their needs and accommodation providers are having to deliver and adapt. So the rise of the contact solutions, which have only been sped up obviously due to the pandemic as well, but they sort of started around 2011. Facial recognition came in in 2015. And we had then obviously increase in smart amenities, virtual realities and robots kind of in the last few years as well. So you will learn more about some of those technologies in our TSE subject, which is travel systems essentials. Right.

So that is evolution of the accommodation industry in a nutshell. Some of the trends that are making an impact on the accommodation sector include seamless technologies. So hotels are more aware of that seamless transition and that need for that seamless transition for guests. So instead of the sort of three distinct stages of booking, you know, of, you know, searching, booking and staying, hotels are now implementing technology that sort of automate and streamline the entire guest experience from start to finish.

From hotel profiles on websites to optimise direct booking engines and also on, you know, one click. check in and check out functionalities so it's kind of all in one place the millennial travellers so millennials um are the largest generation and also one of the biggest um target audiences for the hotel industry because they represent a large chunk of the market. And with the changing of this generation, people of this age group, so we're talking at the moment probably, you know, anywhere so from 22 to 42 or something like that, depending on which website you're looking at, they have different expectations and needs when it comes to travel.

So much that hotels have had to listen and adapt, you know, their then, you know, offerings, I guess. So an example of that would be Marriott's Aloft brand, which I know that there's one in Perth. They have, those hotels have rooms with more contemporary designs, common areas to encourage social interaction.

They use innovative programming, centring on music, art, design, as well as latest technology. They also have a thing called Roomcast. I'm not sure if you've heard that before, but it's a technology that allows guests to scream, to stream media. from Netflix, YouTube or other channels directly into their hotel room.

There's also demand for personalisation in hotels as well. So hotels are looking at guests as individuals, not just a name on a register. So aspects of personalisation include gaining information from the customer in order to tailor make their stay that suits their own unique needs.

So these include personal preferences, including food and music. So, for example, imagine how great it would be. If you arrive in your room, the temperature is just how you like it, not too hot, not too cold.

You had your favourite coffee pod sitting beside the coffee machine, the perfect pillow, and within minutes room service delivers your favourite meal, you know, to your room, all while your favourite songs are playing in the background. So that's just a bit of an idea of how you can personalise a guest experience at a hotel. There's also a big focus on wellbeing, so that's a bit of a travel trend as well.

So travellers have two distinct needs around wellbeing travel. So they can either use trips as a primary means to focus on their health and or maintaining healthy habits during physical vacations and business trips. So it can either be a trip for wellness and purely wellness or it's a bit of a secondary. So when they're on a holiday, they actually want a factor of, you know, a little bit of wellness, might be a massage or do a yoga class or something like that.

Okay. So, you know, and the trend is seeing that, you know, people will book hotels based on those offerings of health and wellbeing facilities. And if hotels don't adapt and have these features, then they're going to be left behind. So the growth in importance of wellness has also seen a profound change in what hotels offer guests. There's also an increase of international guests.

So as the global traveller pool grows, so do the number of attractive destinations competing for their dollars. So hotels and... and airlines due to continue to expand supply in promising growing markets while destination markets fine-tune digital and social strategies helping them to tap into rising global demand for the off the beaten path experiences so for example from 2009 to 2017 the us hotel gross bookings grew from 116 billion dollars to 185 billion so there's massive a lot of growth lots more international guests Ecological initiatives, so travellers are being more aware of their carbon footprint, so they want to minimise that where possible, and are booking rooms and hotels with the same value.

So, you know, things that might be immediately visible to guests, such as responsibly sourced toiletries or locally sourced toiletries, lights and air conditioning that switch off automatically when you're not in the room, a towel reuse policy, so you leave the towel on the floor if you want it changed or you hang it up if you want to use it again. And also there are things that are happening behind the scenes as well, such as, you know, going paperless with, you know, cloud based property management systems and, you know, hotels are going green on several fronts. They might have solar power or, you know, something like that. You know, they might have battery, you know, batteries that, you know, power their hotel, you know, solar power batteries, that sort of thing. Explosion of social media.

I think that's pretty self explanatory there. But. Travellers are using social media to check reviews before booking and they're using more travel apps as part of their booking process as well. So obviously keeping up to date with social media, making sure you have a Facebook page or an Instagram page as a hotel so that you can capture that market as well.

All right. So the Accommodation Association is basically Australia's leading accommodation industry representative. And some of their goals include keeping the hotel market competitive.

Regulating paying conditions for employees, proposing and supporting changes to laws regarding the accommodation sector. So this is a really good place to research the hotel sector if that's the one that you've chosen for assessment three. All right. So you may have heard us talk a little bit about the Accor Hotel Group previously.

We have an Accor Hotel Program, so some of our students may be on this program. But they are one of the largest hotel groups in the world, and you can see from the slide all the different brands that fall under the Accor Group umbrella, and many of the brands can be found in Australia. So four popular and distinct brands that fall under that Accor.

banner are Peppers, Mantra, Art Series Hotels and Break Free. So maybe you've stayed in one of these hotels before. Just to give you a little bit of a summary of the different brands.

So Peppers is generally resort style, they are generally five star luxury, they have a range of different room types so from studios to two bedroom apartments or three bedroom apartments and they're mainly located in coastal or regional areas. And examples a Peppers Blue on Blue Resort at Magnetic Island, you've got Peppers Kingscliff in Northern New South Wales and there's quite a lot of them on the Gold Coast as well so Peppers Broad Beach, Peppers Soul in Surfers Paradise and there's also some in New Zealand as well Peppers on the Point in Rotorua, even in Canberra there is a Peppers Gallery Hotel as well so they're sort of I guess the top of the range if you're looking at those four different brands. Then we have Mantra, So Mantra have a corporate and leisure clientele so they you know I suppose the they have corporate would probably be more in the city and leisure would be more on the regional or coastal areas so they're generally rated about four star and they do have a range of room types as well from studio to two bedroom interconnecting rooms you know suitable for lots of different configurations So you've got the Mantra Club Crocodile in Ellie Beach. You've got Mantra Harvey Bay.

You've got Mantra Hindmarsh Square in Adelaide. Mantra Charles Hotel in Launceston. Mantra Geraldton in WA, just to name a few. There's heaps of them on the Gold Coast as well. Break Free is the next brand, which is, again, corporate and leisure clientele in city-based hotels and leisure clientele in regional coastal areas, similar to the Mantra, except they're sort of a little bit more budget.

So three to three and a half star, family friendly, and they do also have the same sort of room types such as studios and two bedrooms and things like that. They're just a little bit more budget, I guess, and three to three and a half star, so perhaps less facilities and not as, you know, nice as the mantra. So Art Series is a corporate and leisure clientele, again, in city-based hotels. They're a bit more of a boutique style. So there's a real...

hotel experience a little extraordinary they focus on art um and they take the you know I suppose each hotel takes the design of a local artist or um or the namesake artist so examples are the Johnson Brisbane in Spring Hill uh the Cullen in um Prahn in Melbourne the Olsen in South Yarra in Melbourne there's the Watson in Walkerville in Adelaide um and just there's a couple of other ones around as well so So, yeah, so I guess brands to just get familiar with, you know, because they are quite common in a lot of places in Australia. So please take time to read through this summary slide because this will really help you to recap on your learning from this module. And don't forget that Assessment 1B quiz is your next one for this subject and it will be open during Week 8 for completion and covers contents in this module and Module 4. So a reminder that as well as reading.

all the essential resources please ensure that you've also completed the discussion forums and the learning activities to set yourself up for the best chance of success. But that's it from me, thanks for watching and next up in module four in week seven and eight we'll be focusing on cruise and tour sectors. Look forward to seeing you then, bye.

Transcript for:Understanding Airline and Accommodation Trends

Transcript for:
Understanding Airline and Accommodation Trends