Hotels Market Report Plus 2009

This Market Report examines the performance of the UK hotel industry. Between 2004 and 2008, the value of the hotel market increased by 29.1% to reach £15.87bn in 2008. For the purposes of this report, the market is divided into two main sectors: corporate and consumer.

The growth that took place in the hotel industry from the late 1990s was fuelled by a number of factors: rising disposable income levels drove demand for second holidays, and the growth of budget airlines made it more affordable for people to travel, which benefited the hotel market both in the UK and overseas.

Within the UK, budget hotels that have fewer frills and lower prices have experienced rapid growth in recent years. These hotels — led by brands such as Travelodge and Premier Inn — put hotel stays into the reach of a larger range of the population. With much of the UK market being dominated by midmarket hotels, the larger brands have attempted to differentiate themselves at the higher end of the market by consolidating their portfolio at the four- and five-star level. This has led to a high level of activity in terms of acquisitions and disposals, as well as refurbishments and relaunches.
Brand development has been a key strategy among the larger players, not only nationally, but in the global market. As business has become increasingly international, the ability to offer a consistent level of service across a number of destinations has become more important. The development of the Internet and direct booking facilities has also necessitated the need for more cohesive brand identity.

The onset of the global economic downturn and UK recession in 2008 has had an impact on hotel performance, with occupancy levels falling and hotels responding by putting together more appealing packages or cutting rates. The result has been falling revenues, and budget hotels may have taken a greater share of clients as corporate travel budgets are cut and leisure travellers look to minimise expenses. However, midscale and more upmarket hotels have also responded by offering incentives such as meals and free extra nights to appeal to clients.

The downturn in business will be reflected in lower turnover for the industry in 2009. While some commentators are already looking for more optimistic signs in the economy, it will be a year of recovery rather than growth. However, longer-term prospects remain positive. SHOW LESS READ MORE >

Executive Summary

1. Market Definition
REPORT COVERAGE
Other Terminology
MARKET SECTORS
Corporate
Consumer
MARKET TRENDS
Tourism Trends
Table 1.1: Overseas Residents’ Visits to the UK and Expenditure in the UK (million, £m and £), 2004-2009
Spending on Accommodation
Table 1.2: Number of Nights Stayed in Accommodation and Expenditure on Accommodation in the UK by UK and Overseas Residents (million and £m), 2007 and 2008
Room Occupancy
Table 1.3: UK Hotel Room Occupancy (%), 2005-2009
Recession and Hotel Performance
Table 1.4: Proportion of Nights Spent and Expenditure on Hotels, Motels or Guest Houses and Other Accommodation in the UK by UK and Overseas Residents (%),
2007 and 2008
Slowdown in Hotel Investment
Midmarket Versus Budget Hotels
ECONOMIC TRENDS
Population
Table 1.5: UK Resident Population Estimates by Sex (000), Mid-Years 2004-2008
Gross Domestic Product
Table 1.6: UK Gross Domestic Product at Current and Annual Chain-Linked Prices (£m), 2004-2008
Inflation
Table 1.7: UK Rate of Inflation (%), 2004-2008
Unemployment
Table 1.8: Actual Number of Unemployed Persons in the UK (million), 2004-2008
Household Disposable Income
Table 1.9: UK Household Disposable Income Per Capita (£), 2004-2008
MARKET POSITION
The UK
Table 1.10: Indices of UK Gross Domestic Product, Household Expenditure and Hotel Turnover at Current Prices (index 2004=100), 2004-2008
Overseas

2. Market Size
THE TOTAL MARKET
Table 2.1: The UK Hotels Market by Value at Current Prices (£m), 2004-2008
Figure 2.1: The UK Hotels Market by Value at Current Prices (£m), 2004-2008
BY MARKET SECTOR
Corporate
Table 2.2: Proportion of UK Tourism Visits Accounted for by Business Travellers (%), 2004-2008
Table 2.3: Domestic Business Travel in the UK by Purpose of Trip (million and £m), 2007 and 2008
Table 2.4: Overseas Business Travel in the UK by Purpose of Trip (million and £m), 2007 and 2008
Consumer
Table 2.5: Domestic UK Consumer Tourism by Purpose of Trip (million and £m), 2007 and 2008

3. Industry Background
RECENT HISTORY
NUMBER OF COMPANIES
Table 3.1: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Operation of Hotels by Turnover Sizeband (number and %), 2008
EMPLOYMENT
Table 3.2: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Operation of Hotels by Employment Sizeband (number and %), 2008
REGIONAL VARIATIONS IN THE MARKETPLACE
HOW ROBUST IS THE MARKET?
LEGISLATION
KEY TRADE ASSOCIATIONS
British Hospitality Association

4. Competitor Analysis
THE MARKETPLACE
MARKET LEADERS
Accor UK Business & Leisure Hotels Ltd
De Vere Hotels & Leisure Ltd
Guoman Hotels Ltd
Hilton International Hotels (UK) Ltd
InterContinental Hotels Group PLC
Macdonald Hotels Ltd
Marriott Hotels Ltd
Millennium & Copthorne Hotels PLC
Premier Inn Hotels Ltd
Travelodge Hotels Ltd
OUTSIDE SUPPLIERS
MARKETING ACTIVITY
Main Media Advertising Expenditure
Table 4.1: Main Media Advertising Expenditure by UK Hotel and Bed & Breakfast Operators (£000), Years Ending June 2008 and 2009
Accor
InterContinental
Premier Inn
Travelodge
Exhibitions

5. Brand Strategy
INTRODUCTION
BRANDS
Abode
Accor
Alternative Hotel Group
Choice Hotels
Corinthia Hotels
Four Seasons Hotels and Resorts
Guoman Hotels
Hilton
InterContinental Hotels Group
Jury’s Inn
Louvre Hotels
Marriott
Millennium & Copthorne Hotels
Premier Inn Hotels
Rezidor Hotel Group
Starwood Hotels & Resorts
Travelodge

6. Strengths, Weaknesses, Opportunities and Threats
STRENGTHS
WEAKNESSES
OPPORTUNITIES
THREATS

7. Buying Behaviour
CONSUMER PENETRATION
Table 7.1: Usage of Hotels in Britain in the Past 12 Months (% of adults), 2009
By Sex
Table 7.2: Adults Who Had Stayed in a Hotel in Britain in the Past 12 Months by Sex (%), 2009
By Age
Table 7.3: Adults Who Had Stayed in a Hotel in Britain in the Past 12 Months by Age (%), 2009
By Social Grade
Table 7.4: Adults Who Had Stayed in a Hotel in Britain in the Past 12 Months by Social Grade (%), 2009
By Region
Table 7.5: Adults Who Had Stayed in a Hotel in Britain in the Past 12 Months by Region (%), 2009

8. Current Issues
COMPANY AND BRAND DEVELOPMENTS
Bespoke Hotels
Park Inn Hotels
Principal Hayley
The Real Hotel Group
Shearings
Owner Hotels
National Trust Hotels
REVIEW OF GRADING SYSTEM

9. The Global Market
GLOBAL TRENDS
Company Performance
Brands
PEOPLE’S REPUBLIC OF CHINA
GLOBAL BRAND DEVELOPMENTS
Accor
Hilton
Intercontinental Hotels Group
Jumeirah
Jury’s Inn
Marriott
Premier Inn
Rezidor Hotel Group
Thistle Hotels

10. Forecasts
INTRODUCTION
The Economy
Population
Table 10.1: Forecast UK Resident Population by Sex (000), Mid-Years 2009-2013
Gross Domestic Product
Table 10.2: Forecast UK Growth in Gross Domestic Product in Real Terms (%), 2009-2013
Inflation
Table 10.3: Forecast UK Rate of Inflation (%), 2009-2013
Unemployment
Table 10.4: Forecast Actual Number of Unemployed Persons in the UK (million), 2009-2013
FORECASTS 2009 TO 2013
Table 10.5: The Forecast UK Hotels Market by Value at Current Prices (£m), 2009-2013
Figure 10.1: The Forecast UK Hotels Market by Value at Current Prices (£m), 2009-2013
MARKET GROWTH
Figure 10.2: Growth in the UK Hotels Market by Value at Current Prices (£m), 2004-2013
FUTURE TRENDS
Recovery Period
Competitor Developments
Tourism Trends

11. Company Profiles
ACCOR UK BUSINESS & LEISURE HOTELS LTD
GUOMAN HOTELS LTD
HILTON INTERNATIONAL HOTELS (UK) LTD
INTERCONTINENTAL HOTELS GROUP PLC
MARRIOTT HOTELS LTD
MILLENNIUM & COPTHORNE HOTELS PLC
PREMIER INN HOTELS LTD
TRAVELODGE HOTELS LTD

12. Company Financials

13. Further Sources
Associations
Publications
General Sources
Government Publications
Other Sources
Key Note Sources
Understanding TGI Data
Number, Profile, Penetration
Social Grade
Standard Region
Key Note Research
The Key Note Range of Reports

- Accor Uk Business & Leisure Hotels Ltd
- Guoman Hotels Ltd
- Hilton International Hotels (Uk) Ltd
- Intercontinental Hotels Group Plc
- Marriott Hotels Ltd
- Millennium & Copthorne Hotels Plc
- Premier Inn Hotels Ltd
- Travelodge Hotels Ltd