VISITORS to Manchester on Saturday 27 February can expect to pay around £209 for a standard double at the Britannia, £339 for a double at the Palace Hotel, £515 for a double at Hotel Gotham and £662 for a Junior Suite at the Macdonald. Each of these is 87% to 145% more expensive than the same rooms the following weekend. That's if you can even book that is - thanks to a perfect storm of the big fight (Frampton vs Quigg at the arena) and the big game (Man Utd vs Arsenal, Old Trafford), city centre rooms are gold dust.
How do you think those visitors would react if a restaurant doubled the costs of its food on Saturday night?
You might think that Manchester hotel prices are the last thing most of our readers have to worry about – these are tourist problems. But that is where you’d be wrong. The so-called ‘visitor economy’ is huge for Manchester, and it’s getting bigger all the time. People from all over the world travel to Manchester for sporting events and pop concerts. We are the centre for culture in the North West, and there is, of course, plenty of great shopping to be done.
And Manchester’s hotel scene has responded accordingly – last year we saw the opening of Hotel Gotham, Hotel Football, King Street Townhouse and Innside Manchester, amongst others. Established hoteliers are also raising their game and upgrading features in order to attract visitors, such as the welcome refresher of the spa facilities of The Midland. The industry is looking to be in vibrant health.
And that is as it should be. Hotels are at the frontline of the visitor economy. What happens in a hotel will colour the rest of a traveller’s experience and how he or she views our fair city. Anyone who benefits from the cash tourists bring into Manchester should be interested in how hotels are representing us all. And most do a fabulous job.
But one factor is likely to influence customer satisfaction more than any other – and that is price. We all like to feel we have got value for money. And knowing that your hotel room cost twice as much from one weekend to the next is bound to get some backs up.
Hotels work on a system known as dynamic pricing (also sometimes called yield management) – where prices go up or down according to current demand. This is a familiar system from travel, much to the woe of every parent of school-aged children who look upon all those lovely September holiday deals with envy. If you ever buy anything second-hand on Amazon Marketplace you have probably benefitted from dynamic pricing. It’s basic supply-and-demand, the backbone of capitalism.
You might also be familiar with the pricing system from using Uber – the ‘surge’ is another form of dynamic pricing. And it seems that local customers are not happy with fares reportedly going as high as £7 per mile in peak times. Technology Review called the system “efficient price gouging”.
But the benefits flow the other way of course. When a good or service is rare – our hotel rooms for example – prices go sky-high. The difference is that while prices can only drop so far in times of a glut, they can keep going up and up and up when a resource is scarce. ‘So what?” you might think, if some people are prepared to pay, then more fool them. But it is a problem when you consider that a bad experience might prevent a return visit. And returning visitors, and their willingness to spend, is what drives the visitor economy.
Hotel Gotham is charging £515 for a double room on Sat 27 Feb - £240 more than the following weekend
Consider that a room (with no windows) at Sacha’s costs £199 on Saturday 27 February, £112 more than it would cost you the following weekend. Now take a moment to read some of the trip advisor reviews:
“It's dirty, my room had no window and hadn't been decorated in 20 plus years, the door didn't fit and it was thoroughly dreary.”
“Horrible rooms with no windows blood up walls rude reception staff. Dirty bedding! No towels in room had to ring house keeping to get room cleaned.”
“I was expecting something basic, but not something as bad as this.”
While we hardly take Trip Advisor as gospel (it is massively subjective and prone to tampering after all), even if only a percentage of the 942 'terrible' reviews are accurate, that is quite a few visitors who are not coming back. And telling their friends what a piss-hole Manchester is. The plain truth is, it doesn’t look good.
While dynamic pricing might be good for hotels in the short-term, is it really best in the long-term? And do the few who take advantage of surges in demand spoil it for the rest who are proving good service at a more commensurate price?
As with any market, it’s not the tooth-and-claw jungle of neo-liberal fantasy. There are ‘strategies’ and ‘visions’ for the Manchester visitor economy, overseen by the Greater Manchester Visitor Economy Board, comprised of representatives from the hospitality industry, tourist attractions, Visit Manchester and the Council.
Nick Brooks-Sykes, director of tourism at Marketing Manchester, said:
“Whilst it’s impossible to predict an exact occupancy rate in advance, historically we know that when Anthony Crolla and Darleys Perez fought in November 2015 occupancy was incredibly high in the city centre and that was the same day as a game at the Etihad. We would therefore expect occupancy on Saturday 27 February to be upwards of 95%.
“Of course, this is excellent news for the visitor economy, but it also underlines the need for the 1,000 additional bedrooms which are expected to be added to the market in 2016, plus the 2,250+ planned for next year and beyond."
So it‘s great news that more hotels are coming to cope with demand, introduce a bit more competition, and bring more jobs to the city. Manchester is becoming a more and more attractive place to visit, that's something we can all benefit from. But how many are benefitting from exploitative hotel rates? The hotels, yes. The city? How do you think those visitors would react if say, a restaurant doubled the costs of its food on Saturday night, Spinningfields bars started charging £10 a pint or Greggs £2.50 for a sausage roll. Wouldn't visitors think Manchester a rip-off? Wouldn't they stop coming back?
Without being to hippy-happy-huggy about the whole thing (do we really expect hotels to cap their rates just to boost the city’s reputation? Hardly) there is something the city’s events planners can do to help. By spreading events out, both temporally and geographically, the problem of peak demand can be lessened, as well as spreading some of the wealth generated by these events a bit more evenly.
