Green is the New Black in the Hotel Industry: Optimizing Revenue Through Promoting Sustainability

Abstract

This case study examines the challenges and opportunities faced by hoteliers in leveraging their sustainability to optimize their revenue. Although it has been shown that sustainability has several positive effects and is demanded by customers, it is not clear how it affects a hotel’s profit margins. This raises the question of how sustainability can positively impact revenue if hoteliers must, by definition, make significant investments to operate more sustainably. The solution may lie in effectively measuring and benchmarking their sustainability against their competition, and then using that information in the hotel’s marketing efforts. If done correctly, these strategies will allow hoteliers use the sustainability of their operations as a point of differentiation that could be used to achieve competitive advantage. In other words, raising the reputation of the hotel in the customers’ minds, could directly lead to increased revenue.