Hotel Lounge Economics 📈

TravelVIP
5 min readDec 9, 2022

Many larger hotels offer members of a certain level lounge access. Read on for an amusing insight regarding the ecology of hotel lounges and their paradoxical nature.

Some sign that says there is a lounge inside — Exciting…

Not all Lounges Are Equal:

Hotels ranging from $60 or so per night to $1,000+ per night can all have lounges. Whilst of course, one would expect the $1,000 per night hotels to have superior lounges (and they usually do), a change can be observed in lounge clientle.

If a Gold or Silver (relatively normal) member can access the lounge at any hotel regardless of price per night, it stands to reason that a Silver member at a $1,000+ per night hotel, likely has far greater financial means than the highest tier loyalty member at a lounge at a $100 per night hotel.

The current rules for lounge access

The Hotel Lounge Paradox:

Why would someone visit a hotel lounge? Typically it is to enjoy (benefit from) complimentary (free) food, alcohol and possibly for a quiet space.

Logically, one cannot believe that the free lounge food is of superiror quality to food at the hotel resturant or probably most resturants in the area you are staying. The food, due to the fact a hotel is a business, is often food that cannot be sold for whichever reason or food in overstock.

Of course the same goes for alcohol. If you seek high quality whiskey, wine, or whatever your poison might be (if you drink), then it won’t be found at the lounge. Maybe some lounges have a limited number of semi-decent wine each night, but after that it’s onto the basic stuff.

Therefore, what is really happening in many hotel lounges?

  • People who have a certain loyalty level and are supposedly well healed visit them
  • During certain hours, to benefit the most
  • For free food and drink, which is not of the highest quality

It’s quite amusing, a group of the most loyal customers, some of whom probably believe they are quite special, waiting for the clock to strike 17:00 for “Happy Hour” to begin. There is certainly nothing wrong with this, everyone should enjoy value, but in any other setting this activity would not be considered to be behaviour of the 1% or elite, but rather akin to those who collect discount vouchers, or use bonus codes — which again, is perfectly normal and should be done. The difference is, in this setting it is allegedly high net worth individuals, queing up for 2 day old, microwaved chicken nuggets.

Story Checks Out: Cannot say anything bad if something is complimentary — customer’s choice to partake or not, but so amusing this is what the top level members rush to the lounges and queue up for — High Society, they say 🤣
Ritz Carlton Lounge

Value of a Good Lounge:

Personally, I have seldom drank significant amounts of alcohol or eaten a lot in lounges, never specifically visited during “food time”, but found amazing value (as I work online) in the following areas:

  1. Coffee — Many lounges (I guess) have coffee shop level machines, and that kind of coffee is not so easy to re-create with a kettle and instant coffee.
  2. Admin — Need to print, scan, arrange a delivery or anything work related? Provided you are not in the lounge during rush hour, often several staff are on hand to willingly help with this kind of thing and much more. For this type of assistance and the time it saves, one would employ an assistant, and based on my observation the lounge staff are often simply better qualifed to help with this kind of thing
  3. Flow — If you have nice people, who can help with admin, a nice computer, fast internet, coffee, fruit, then it’s extremely difficult to become distracted and productive output is likely.

Conclusion: If a new, 5 Star Hotel is selected with a large lounge, then for around $3k per month, you can be setup with a combination of perfect accommodation, amazing coffee, fresh fruit, all bills (electric, internet, air con, heating) paid for and a very decent work environment with people happy to help you.

I am not sure how much WeWork or a shared office space costs, but add it all together and this is quite a nice option.

There are also hidden benefits not to be overlooked, such as the ability to go to abroad and open a bank account using the hotel address, where you can be confident any correspondence (via snail mail) shall be scanned and forwarded to you. Have a meeting or presentation? You get a lovely private room — As I can tell, simply do not be a blatant bottom feeder or use the lounge to entertain 5 guests who clean the place dry, and you are already quite a unique guest.

I am not sure how happy those work in lounges would be if everyone began using lounges for business as suggested, but hotel lounges are places where I’ve done some of my best work and even hired people from there.

For networking: As mentioned, it probably depends on the price per night of the hotel, rather than the actual status needed to access the lounge.

A little bet: If anyone ever approaches you or enters into conversation (which can be nice), and begins mentioning something about VIP Level or stuff like this, probably 75% chance their level (it’s not important anyway) will be distinctly unimpressive, and it’s funny as it’s usually those who might be more interested in privacy and understated, that are the real VIPs.

To take this idea a step further: Do Royalty or Super HNW Individuals even bother going to lounges? Maybe once per visit, if at all, but probably not — so know your audience :-)

Travel Comfortably,
🛫 TravelVIP

https://travelvip.com

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TravelVIP

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