IS THE OFFICIAL HOTEL RATING SYSTEM SINKING INTO THE PAST?

19 May 2016

Hotel Star Ratings

The inspection and classification of lodging facilities emerged in the early 20th century. In the following decades, tourism authorities of many countries established and implemented individualised official hotel rating systems. However, the seismic change in the global hotel industry over the last two decades has rendered the official star rating systems out-of-date and inconsistent across Asia. The credibility of these systems has diminished and in many cases has left the consumer relying more on social media and other channels to judge the quality of a hotel.

 

Today, as booking decisions are made faster and easier by highly accessible information through citizen media – guest review websites, consumer photos and travel blogs to name a few – it becomes vital to understand how the official ratings are perceived by discerning travellers around the globe.

 

QUO undertook a comprehensive review of the issue, analysing recent industry studies, interviewing hospitality experts and surveying travellers.

 

Our research suggests that officially accredited “stars” take a backseat in influencing consumer decisions, as the rating systems have variable meaning across markets, are plagued by disparities and are not  geared toward reflecting guest experience. Hotel brands and the reputation of properties, on the other hand, have become increasingly valued and critical to decision making.

 

Industry practitioners state that to be relevant, an official classification system needs to be reviewed and upgraded on a consistent basis, addressing the latest trends and global perspectives, encapsulating multiple competitive dimensions, and engaging guests as key stakeholders. It should stimulate service improvement and catalyse service innovation.

 

An Industry Perspective

 

The Official Rating System Is A One-Dimensional Metric To Predominantly Communicate The Hardware Facilities.

 

In the prevailing grade-based rating system, criteria are itemised and assigned specific scores or weights. Hardware and a checklist of service availability take centre stage. Assessment committees carry out a one-time inspection to accredit a star rating. Without further periodic audits or integration of customer feedback, the evaluations are unlikely to comprehensively reflect the quality, consistency and perceived value of the facilities and services.

 

Chinese hotel rating systemChinese hotel rating system

 

It Allows Disparity.

 

Most grade-based systems adopt a bottom line – there is a lowest score a hotel needs to achieve in order to reach a certain star level. This methodology allows disparity in hardware and software, as hotels could selectively miss a few points, translating to the varying quality of facilities and service across the spectrum of same-starred hotels.

 

It Does Not Address The Needs Of Hotels Today.

 

The systems include criteria that are no longer relevant today, failing to address many hotels’ strategic needs to differentiate and serve a very niche market. While the ratings award all-around players, hotels win the game today by serving a clear segmentation of customers and playing to their unique needs and desires.

 

The systems also fail to take into account some key factors that impact customer experience and perception of hotels – for example, location, design and competitive set.

 

A Consumer Perspective

 

The Official Rating Is Not In Consumer Language

 

Bangkok Hotels TripAdvisor Ratings

 

It Is Not Universal.

 

Rating standards vary by country. Therefore, guests are likely to encounter varying facilities and services at each star level in each country they visit.

 

Discrepancy of Hotel Star Ratings

 

It Is Confusing.

 

The rating criteria are not known by the public. As survey respondents reveal, “the travelling public has little or no knowledge of what is required to achieve different quality ratings”. Moreover, the self-supplied star ratings on third-party websites are inconsistent and misleading.

 

And Most Critically, It Does Not Reflect Guest Experience.

 

Official star ratings tell little about the guest experience. The systems fail to effectively communicate the uniqueness of the experience, innovation or the way a hotel meets the needs of a distinct target market.

 

Even the same-starred hotels within the same locality present differing guest experiences and perceived customer value. For example, one 5-star hotel in Bangkok has 83% of its TripAdvisor reviews marked as “Excellent”, whereas another nearby 5-star property has only 30% – a noticeable discrepancy of guest experience. Similar disparities are also present in the customer ratings on Booking.com, where some 4- and 5-star hotels score significantly higher than their counterparts in all major aspects throughout the guest journey.

 

Some survey respondents stress that the official ratings are less reliable than consumer reviews online, and that the actual experiences often fall short of guest expectations.

 

Understanding Today’s Travellers

 

Travellers Today See The Official Rating As Only One Source Of Reference. They Increasingly Value Brand And Embrace Citizen Media.

 

As travellers indicate, they “often look at the brand, whether it’s an international chain or a member of a global alliance” and “check multiple sources of information to be reassured of the quality”. Many speak of the value of customer reviews, asserting that “personal recommendations carry far more detail and credibility, and are so easy to access nowadays”. For hotels, this phenomenon poses a crucial need to switch tactics – from being product-focused, to being experience-driven and socially engaging.

 

Importance Information Source for Booking a Hotel

Confidence of Hotel Credentials When Booking a Hotel

 

Hospitality Industry Views

 

The classification system needs to be reviewed and updated more often, to capture the new trends, and to incorporate the feedback from the industry.

 

Mark Dardenne

CEO

Patina Hotels & Resorts

 

 

Software assessment is a more subjective view. It needs to get feedback from the guests.

 

Peter Henley

President & CEO

Onyx Hospitality Group

 

 

The rating needs to mirror the global perspective.

 

Kevin Beauvais

Co-founder & CEO

Zinc InVision Hospitality

 

 

The system fails to look at the business today – the new need for boutique and budget hotels.

 

Cyndy Tan Jarabata

President,

TAJARA Leisure & Hospitality Group

 

 

For us, the brand identity matters most.

 

Gregory Meadows

General Manager

The Sukhothai, Bangkok

 

 

We don’t use star classifications to refer to our brands. There are many different rating schemes which makes it very subjective.

 

Simon Scoot

Vice President

Global Brand Management,

InterContinental Hotels & Resorts

 

 

I think a rating system based on ADR works best. It’s consumer-driven, reflecting how much people are willing to pay for the product and service, providing a clear gauge of a hotel’s perceived quality as ranked by its achieved price.

 

Robert Hecker

Managing Director

Horwath HTL Asia Pacific