Acquisition Insights Hotels Towels Hotel Private Equity Firms Hospitality

Hotel Acquisition Insights: How the Cleanliness of Towels Can Help Hotel Chain Purchase Decisions

When considering the acquisition of a hotel chain, investors often zoom in on profitability metrics such as room occupancy rate (yield) and location desirability.

However, a less obvious but equally telling indicator of a hotel’s operational standards is not the overall “Parent” Category scores on Trustpilot and Google Reviews, but it’s the micro categories hidden in the reeds that you need to track such as the cleanliness of the reception, room, pool sheets and towels.

Yes, towels….

Towels serve as a direct interface with guests (no laughing at the back) and their quality and hygiene speaks volumes to the guest about the overall attention to detail and care invested in the hospitality experience.

Top Hotel Private Equity Firms

For such a relatively inexpensive inventory item, the humble towel punches way above its weight than other factors that take significant effort to maintain to the same standard of guest expectation consistently.

Assessing towel cleanliness also offers a microcosmic insight into the health and hygiene standards maintained across the entire hotel chain as the state of the towels can reveal both the efficiency of housekeeping protocols and the underlying commitment to guest health and satisfaction.

And the good news is that it’s also the near hands down one of the easiest guest satisfaction factors to improve with minor investment and little to no need for continuous observation of the execution, unlike a new staff training programme or pool re-fit…

Real Estate Placement Agents

Why tracking Hotel Micro Categories and themes is harder than you think

The information you get from scraping the reviews from Google and TrustPilot is generally extremely useful and very much you “drive-by” starting point on any acquisition.

However, even with specialist hotel software, it’s still very much high level, especially if you’re investing in an acquisition or have just acquired a hotel group and thus granular, highly accurate metrics are essential for your investment process.

This is due to the following factors;

Rating differences

One platform can be 1-10, another 1-5 which means this needs to be standardized.

Difference number of categories and naming

It’s subtle but you still need to match up especially if a platform has two similar categories.

False negatives

i.e. “this hotel is s**” and “this hotel is the s**t. This still has to be humanly dissected or you need to train an AI model preferably with a foundation model trained on a relevant dataset (more of that below…).

No tracking of micro trends and categories

Most platforms track the parent category (i.e. Cleanliness) and tag what is mentioned in the review but do not accurately “carve out” and track the score or positive/negative sentiment of micro themes and categories, and this is where the value it.

The Positive/Negative Review

This is accurately quite common and wrongly associates strong areas with a negative review and a classic example is food quality, service speed and staff engagement. Only one of these can be sub-standard, while often all are included in the negative review score or sentiment analysis.

The Solution: How to Track Hotel Micro Categories

Previously to identity and track micro-trends this required significant human labor, category expertise, data science level analysis as well as continuous observation.

However, now with the help of AI, you can achieve this level of granular insight with far less effort by training up a Large Language Model (LLM) which is – to keep it simple – the base data set for GPT and other AI platforms use to generate their responses.

Once you’ve done this, with the help of an industry specialist or data scientist, you can identify your micro themes and train your “Hotel LLM” to understand any micro category you want to track to a high degree of accuracy.

The beauty of this level of granular insights is that – if you are acquiring a hotel or chain – you can run this model at scale and continuously to benchmark against any wider group be it local competitors, brand level rivals, hotel class or proposition type and even at national level.

This approach will give you a much more informed negotiation acquisition position as well as morer accurate investment budgeting and, once the acquisition is completely, you can observe live the impact on the guest reviews as you roll out across your portfolio leading to more guests, more returing quests and organic referrals leading to a more profitable investment.

And who benefits in the end?

Well, you and me do, as we all get cleaner towels…

Notice: ob_end_flush(): Failed to send buffer of zlib output compression (1) in /home/rainmak1/public_html/wp-includes/functions.php on line 5420

Notice: ob_end_flush(): Failed to send buffer of zlib output compression (1) in /home/rainmak1/public_html/wp-includes/functions.php on line 5420