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Marriage equality creates new hotel market
January 17 2014

Hotels in popular wedding and honeymoon destinations, such as Hawaii, could see increases in business from same-sex couples.

Highlights
  • 18 countries and 18 U.S. jurisdictions recognize same-sex marriages.
  • Legalization of same-sex marriages in Hawaii will generate $217 million in additional visitor spending, according to a study.
  • Four Seasons’ hotels on Lanai hosted 120 weddings last year.
 
Four Seasons weddings

REPORT FROM HAWAII—As more jurisdictions legalize same-sex marriages, hotels that host destination weddings and attract honeymooners should see increases in business. However, to realize these additional revenues, hotel operators need to meet the needs and expectations of this market segment, sources said.
 
“We’ve been huge advocates for the (lesbian, gay, bisexual, transgender) community since our founding in 2001, and we firmly believe diversity is at the core of every successful company,” said Elizabeth Churchill, senior VP of sales and marketing for Honolulu-based Aqua Hospitality. The company operates 29 hotels in all six tourism islands of Hawaii as well as Guam. “People have come to know us as the go-to company in support of LGBT and diversity, equality and acceptance.”
 
Last month, Hawaii’s law legalizing same-sex marriages took effect, joining 16 other states, plus the District of Columbia, and 17 countries outside the United States with marriage equality laws on the books.
 
Within the first month that Hawaii enacted the law, nearly one-fourth of marriage applications in the state (526 of 2,144 total applications) were made by same-sex couples, according to Hawaii News Now, citing data from the Department of Health.
 
“That number will continue to grow,” said Churchill. “Every state that has passed this law has seen an uptick in tourism, and given that Hawaii is a premium destination for weddings, it should be true here also.”
 
According to a study by Professor Sumner La Croix and Lauren Gabriel from the University of Hawaii, the change in the state’s law will generate $217 million in additional visitor spending by the end of 2016. The estimate only includes spending by same-sex couples and their guests who live in the U.S. Also, according to the report, the annual spending estimates should drop in a couple of years as pent-up demand depletes from same-sex couples who want to marry.
 
“The numbers are relatively large—$70 million a year is a good chunk of money—but (tourism) is a $14-billion-a-year industry (in Hawaii), so $70 million in extra dollars represents one-half of 1%,” La Croix said during a telephone interview. “It won’t lead to an economic boom, and not all you’ll see on Waikiki are gay couples getting married.”
 
And as he pointed out, because the hotel business in Hawaii has been strong for the past few years, some couples who want to visit the state might have difficulty locating or affording hotel space for a destination wedding or honeymoon, particularly on the island of Oahu.
 
“There is some possibility of crowding out, especially if they want to come during (high season),” he said. “However, occupancy rates on neighboring islands aren’t typically close to capacity, so someone who wants to book a room on the Big Island, for example, shouldn’t have a problem most times of the year.”
 
According to STR, parent company of Hotel News Now, November 2013 year-to-date occupancy for Oahu was 84.1%. That compared to 76.5% on the island of Hawaii, 72.2% on Maui and 64.2% on Kauai. 
 
Different approaches
Hotel companies in Hawaii can take slightly different approaches to serving the same-sex wedding and honeymoon market.
 
Churchill said Aqua has been catering to the LGBT market for many years and doesn’t plan to create special packages and programs for same-sex couples.
 
“We have packages in place that apply to everyone,” she said. “That’s what we’ve been fighting for for years. Marriage equality means everyone can take advantage of all the promotions we have on our website.”
 
Because most of Aqua’s properties don’t have food-and-beverage capabilities, its hotels don’t typically host destination weddings. According to Churchill, often the couple will stay at a beachfront luxury resort and hold the wedding and reception there. Yet, not all of the couple’s guests can afford those room rates and instead stay at one of Aqua’s mid-priced products.
 
For these situations, Aqua offers its No Commitments package that doesn’t require a room block. Under the program, the couple or their guests can book rooms at the Aqua property any time up to the day of the wedding at the best-available rate, minus a discount for that wedding party.
 
On the island of Lanai, Four Seasons Hotels and Resorts’ two hotels, Manele Bay and The Lodge at Koele, offer a variety of luxury wedding options, all tailored specifically to each couple, said Hector Rubio, director of catering and conference services for the two properties. The hotels hosted 120 weddings last year, including some civil union ceremonies. The hotels have received a number of inquiries from same-sex couples since the law went into effect, he said.
 
“In today’s wedding environment, whether it’s a man and woman getting married or two men or two women, they want the experience to showcase who they are as people,” Rubio said. “So every detail regarding this event and series of events involves putting who they are on a template and tailoring everything around that.”
 
Since the change in the law, the hotels developed a package specifically for this market called Love Is Love “because love doesn’t see race, color or gender, which is what we believe at this resort,” Rubio said.
 
Marketing to the segment
Hoteliers need to show commitment to the market to attract LGBT business, according to John Tanzella, president and CEO of the International Gay & Lesbian Travel Association, one of several travel sites (TAG Approved is another one) that list and certify LGBT-friendly travel providers.
 
“When same-sex couples look for a property to have a wedding or reception, or even a honeymoon, they want hotels that are gay-welcoming and have staff members trained in diversity,” said Tanzella. “Like any niche market—whether its African-Americans or Latinos—they want to know the business wants them and is willing to cater to them.”
 
Tanzella said hoteliers seeking business from the LGBT market need to get involved with the community on a local level. Churchill of Aqua said over the years the company has participated in events such as Hawaii’s Pride Parade and the Honolulu Rainbow Film Festival.
 
“It’s not something that happens overnight, and the LGBT community is pretty savvy,” Tanzella said. “If a hotel has been in the market for a while they will support them. But if they come in and leave a year later, the community will turn their backs.”
 
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