Sustainable hotels: How do you balance the struggle between luxury and frugality?

With the United Nations (UN) announcing 2017 as the International Year of Sustainable Tourism for Development, it’s apparent the travel world is becoming more conscious of global issues and responding to corporate social responsibility (CSR).

Given this positive directive, sustainable hotels are sure to become more abundant and the UN has listed five key areas to focus on:

1. Sustainable economic growth
2. Increased employment and poverty reduction
3. Resource efficiency, environmental protection and climate change
4. Cultural values, diversity, and heritage
5. Mutual understanding, peace and security

Sustainable hotels will likely be characterised most by going green and promoting culture and diversity, although they’ll be in a position to contribute to all areas. However, it’s a highly complex issue that hotels will be divided on.

Considering profitability and guest experience are the two most important aspects of a hotel business, is it possible to be successful while also being sustainable and responsible, and to what extent?

One of the most manageable and achievable routes hotels can take is that of environmental protection and climate change management. There’s now too much evidence for climate change to ignore. Global temperature increases, melting ice caps, rising sea levels, regular extreme weather events and more point to a natural environment that needs intervention to recover.

A report by Euromonitor International investigates the potential for sustainable hotels and their relationship with eco-conscious guests.

Is there a market for ecotourism and sustainability?

At the moment there is very little correlation between the most popular tourist destinations and the most sustainable. Currently Euromonitor lists the top five most sustainable destinations as:

1. Norway
2. Sweden
3. Finland
4. Switzerland
5. New Zealand

None of these are in the top 15 popular destinations, while the most popular destination, China, does not rank in the top 15 for sustainability. In fact only four countries have managed to hold a place in both lists: Australia, UK, Germany, and Austria.

There is however a growing understanding in consumers about human impacts on the environment, with Euromonitor reporting 50% of survey respondents are worried about climate change.
This means many travellers may start to put more thought into where they travel and if their hotel is environmentally responsible.

What do sustainable hotels need to balance?

Hotels are a customer-oriented business and they cannot be feasibly expected to undertake activities that make them undesirable or not profitable. Guest satisfaction must always be top of mind, as well as their budget.

If sustainable practices mean less bookings because the hotel doesn’t seem as opulent, or higher costs because they need to install and maintain new systems, then the 17 aspirational goals laid out by the UN will be difficult to achieve by the proposed target of 2030. It could take some time before hotels undertake the challenge because they’ll need to decide if luxury and frugality can coexist in a successful business plan.

What can hotels do to become sustainable?

On the other hand, hotels may find becoming sustainable actually lowers costs and improves their market share of guests.

In 2017, the number of guests who want eco-friendly travel options is expected to grow 36% compared with 2016. Two major cost savers for a hotel would be to reduce energy and water usage. These are relatively easy changes to implement and also perfectly align with the sustainable tourism goals. Water usage is particularly high in the hospitality industry, at around 250-500 litres per day/per room.

Global hotel brands are already setting targets for environmental sustainability. This includes Marriott, Hilton International, and AccorHotels among others.

Marriott for example has laid out the following energy reduction plan:

• International 20% reduction of water usage per room compared to 2007 baseline. As of 2015, a 10.4% reduction was achieved.
• 20% reduction of energy usage per kWh/m2, compared to 2007 baseline. As of 2015, 13.2% reduction was achieved.

The company also aims to reduce waste where possible and has over 1,800 hotels that have earned a TripAdvisor GreenLeaders badge.

There are simple strategies all hotels can introduce that will immediately improve their impact on the environment. These include:

• Reducing water pressure
• Asking guests to reuse items
• Installing leak detecting water systems
• Dual-flush bathrooms
• Grey water systems
• Water bead laundry systems

Not only will this appeal to the growing number of environmentally conscious guests but it will also raise awareness for other guests and hotels to become more sustainable themselves, thus further contributing to the global cause.

Increasingly, guests are looking for authenticity and unique experiences over generic luxury so introducing sustainable practices at your hotel may not be as detrimental as you think.

A recent study reported 64% of people base their loyalty on shared values with the brand so in a world where travellers are more aware of the necessity of sustainability, becoming an eco-friendly brand could be a winning move.

How can sustainable hotels maintain their results?

A sustainability strategy is only useful if it’s a long term solution. To make sure you can keep it up your hotel will have to:

• Measure and refine
  Keep constant track of your progress and how much impact your efforts are having. Try to give your results some context. For example, how many olympic swimming pools does your water-saving equate to in a year?
• Get your staff involved
  The more aware your staff are the easier it will be to manage your strategies. They can educate guests but also do simple things like turn taps off in between washing up or cleaning etc.
• Survey your guests
  You need to find out if guests have an understanding of your mission and how well they think you’re doing, and what they want to improve
• Gain recognition for your hotel
  Registering with eco-travel sites and entering industry awards will help drive bookings and also give you more chances to take sustainable actions at your property

In the end, every individual hotel is different and some may be more equipped than others to balance guest expectations and CSR. Click here for another example of a hotel vowing to contain luxury and sustainability within one property.