Market Characteristics in Economy/Budget Lodging

With so many economy/budget lodging brands and rooms added to the market, it is difficult for consumers to identify differences in the services offered. In addition, industry practitioners need to understand what is expected of them by the consumers they serve. The authors review the economy budget lodging in general and empirically examine this issue. This article is available in Hospitality Review: http://digitalcommons.fiu.edu/hospitalityreview/vol18/iss2/4 by Billy Bai, Richard Ghiselli and Thomas Pearson With so many economy/budget lodg~ng brands and rooms added to the market, if is difficult for consumers to identify differences in the services offered. In addition. industry practitioners need to understand what is expected of them by the consumers they serve. The authors review the economyhudget lodging in general and empirically examine this issue. T he boom in the economyl budget segment of the U.S. hotel industry has been remarkable. Dispersed as they are, economyhudget hotels are located in all regions and markets across the country. Smith Travel Research (STR) indicates that in the first half of the 1990s, there were more than 17,000 hotels with nearly 1.3 million rooms in this lodging group. Moreover, they comprised 56 percent of all properties and 39 percent of total rooms available in the US.' Daily rates and RevPAR (revenue per available room) were estimated to increase as much as