About a month ago, I stayed at the Paris Hotel in Las Vegas. When I arrived at the hotel at around 9 p.m. one weekday night, I was expecting the usual long line of people waiting to check in. And, no surprise, that’s what I found. But I also found something else, something surprising.
When it came time to check in, I noticed that where there was once a dozen or so “guest services” agents behind the desk, there were now only kiosks in front of the desks. Guests punched in their confirmation number, inserted their driver’s license and a room key was spat out after a few moments of verification.
A cost cutting move? For sure. Those machines will pay a handsome return on investment to the hotel once guests get used to their presence and the hotel no longer has to pay salaries, health care and other employee benefits. But the machines represent something else: a pivot towards ‘shrinkflation’ that the entire hotel industry is shrewdly practicing.
By now you’ve heard of shrinkflation, right? It’s when you pay the same price for a bag of Doritos that once weighed 9.75 ounces but now weighs 9.25 ounces. Or when you pay the same price for a roll of paper towels, toilet paper or Hefty bags but are getting less product. Shrinkflation is nothing more than a price increase turned upside down. It’s keeping the price constant yet delivering fewer products and services for it.
And that’s exactly what the hotel industry is doing. I know this because I travel a lot, and I’ve seen it. It’s a quiet change, subtle, almost unnoticeable. But it’s a change nonetheless. And it’s helping the industry navigate its way through this time of higher costs. So, what is it doing?