WHAT IS IT WITH SERVICED APARTMENTS?

Talk about alternative accommodation, and everyone thinks you’re referring to Airbnb. While it’s true that the use of disruptive providers – like Airbnb – is rocketing in leisure travel, business travel buyers are yet to wholeheartedly embrace them. The serviced apartment industry, however, is flourishing and we have the stats to prove it.

For the last three years, the Business Travel Show has collaborated with ASAP (the Association of Serviced Apartment Providers) to poll buyers. This year, our survey shows that nearly a third of corporate travel buyers increased their use of serviced apartments in 2018.

This is a huge leap from the 20 per cent who turned to serviced apartments more often in 2017. In addition, it was the only accommodation category to see an increase in use over the last 12 months.

Thirty-five per cent of the 134 respondents said they had used the same amount of serviced apartments as they did in 2017 – up from 25 per cent in the previous year’s survey.

When asked why they chose to book serviced apartments, the number one reason given by buyers was “better value for money”, followed by convenience of the self-catering option, more space, flexibility to experience the location like a local resident and long-term suitability.

Kat Hendry, Business Travel Show account manager, below

Buyers are also allocating a higher proportion of their budget to serviced apartments; 77 per cent spent less than 10 per cent of their budget on the accommodation option – down from 90 per cent in 2016. Meanwhile, 17 per cent allocated 11-25 per cent, compared to just 7 per cent in 2016.

For the first time in the survey’s history, a small number of buyers said they allocated 51-100 per cent of their budget to serviced apartments, with 1 per cent claiming to spend their entire accommodation budget on this option.

The number of buyers who didn’t use serviced apartments dropped from 42 per cent in 2017 to 32 per cent in 2018, whereas the proportion not using sharing economy accommodation options such as Airbnb rose from 38 per cent to 45 per cent. Furthermore, the number that haven’t used five-star hotels also went up slightly from 28 per cent to 31 per cent.

These are pretty extraordinary statistics that prove the industry is making considerable headway in raising awareness of serviced apartments as valid and valuable alternative accommodation for business travellers. Not only are more buyers aware of serviced apartments as an option, they also appreciate the pros they offer to their travellers and are much more open to including them in their travel programmes.

They also reflect the ongoing pressure on buyers to cut cost and display improved ROI on travel spend as well as the desire from younger travellers to enjoy the flexibility provided by alternative accommodation providers.

We asked ASAP’s CEO James Foice what he thought of the results. He pointed out how the landscape is rapidly evolving for the serviced apartment sector and how ASAP is also seeing a significant increase in supply year on year. In 2018, he said, they found that more and more companies are booking two-bedroom or two-bathroom apartments, as colleagues will often share the apartment, making it a more cost-effective choice as well as giving employees working away from home some companionship. A two-bedroom option also provides privacy and collaboration space under one roof.

We host the ASAP Pavilion at Business Travel Show, so if it’s a sector you are yet to investigate, come and meet a few them in February.

This post was written by Business Travel Show account manager Kat Hendry -kat.hendry@centaurmedia.com @kathendrybts. The Business Travel Show is the leading event for corporate travel in Europe attracting over 9,000 professionals and 260 exhibitors. Taking place from 20-21 February 2019 at Olympia London, the show is celebrating its 25^th anniversary.