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Road to recovery: Big hotels bet on all-inclusive model to boost sales

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All-inclusive resorts offer in-house dining, outdoor diversions like water sports, complimentary spa treatments, and games and activities, and sometimes even on-site COVID-19 testing.

Road to recovery: Big hotels bet on all-inclusive model to boost sales
A year-and-a-half after the pandemic forced the world to shut down, big hotels are shifting from the a là carte model and adding more all-inclusive resorts to boost business and lure guests to stay at one place.
All-inclusive resorts offer in-house dining, outdoor diversions like water sports, complimentary spa treatments, and games and activities, and sometimes even on-site testing for coronavirus.
With the threat of the contagious Delta variant still looming large in many parts of the world, guests are turning to all-inclusive resorts that offer self-contained trips without complicated logistics.
Buoyed by the new business model, these hotels have also recovered from the pandemic blow faster than other types of hotels, says a report by The Wall Street Journal.
According to hospitality data and analytics company STR, there are around 1,500 all-inclusive properties worldwide. At an all-inclusive resort, the guest makes one payment that covers room, food, cocktails, activities, and other services.
Until now, the hospitality sector has been slow in adopting the model. However, with business travel being sluggish, major hotels are restructuring their portfolio to appeal to safety-conscious leisure travellers who want to stay in one place to limit the risk of COVID-19 infection.
“The industry is convinced that leisure will continue to drive the recovery,” Scott Berman, principal and hospitality-industry leader at PwC, told WSJ.
Sandals Resorts, which has around 15 all-inclusive resorts in the Caribbean, have witnessed a 151 percent rise in bookings in September and October as compared to 2019, reported The New York Times. Another all-inclusive brand, Club Med, which has 70 resorts worldwide, has reported double-digit growth in bookings in several weeks this summer over 2019, the report said.
Wyndham Hotels & Resorts has recently tied up with Playa Hotels & Resorts that owns all-inclusive resorts in the Caribbean, Jamaica, and Mexico. As part of the deal, Wyndham will launch two hotels under the new Alltra brand in Mexico’s Yucatán Peninsula. While Wyndham will work on branding and sales, Playa will manage the properties.
With remote work policies at play, people have the flexibility to extend their weekend getaways by a day or two or work from a resort, Wyndham’s Chief Executive Geoff Ballotti told WSJ. As a result, Wyndham is already witnessing a rise in bookings on Sunday and Monday nights, which were less popular earlier, he said.
In August, Hyatt Hotels agreed to purchase all-inclusive-resort manager Apple Leisure Group for a whopping $2.7 billion. Marriott International will also add 20 new all-inclusive resorts to the brand’s Autograph Collection Hotels. Hilton has recently opened all-inclusive resorts in Curaçao and Mexico and is looking to open soon in Cancun and Tulum.
“The human experience of taking time for personal renewal and also connecting with family, friends and loved ones is in extremely high demand given the challenges we have all faced over the past 20 months,” Hyatt CEO Mark Hoplamazian wrote in an email, adding that this will trigger more leisure travel in the future.
After the US, demand for all-inclusives will rise in Asia in the long run, Gregory Miller, hotel analyst at Truist Securities Inc, told WSJ.  “I think beyond the Caribbean, there’s probably a very healthy runway of all-inclusives for decades to come,” he said.
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