UK-based First Choice has announced their intentions to become the first mainstream hotel chain to move all of its resorts to an all-inclusive format, starting in 2012. Their stated goal is to differentiate themselves from other hotel chains.
“All-inclusive is becoming the holiday of choice for many British consumers, yet there is no mainstream holiday company offering a completely all-inclusive portfolio,” said Johan Lundgren, managing director of parent-company Tui Travel. “With differentiated product we will move further away from customers choosing tour operators based on cost alone, which is unsustainable.”
First Choice will bundle the room, three meals a day, unlimited local beverages, local transfers and airfare.
According to George Loewenstein, professor of economics and psychology at Carnegie Mellon University, paying for meals and beverages throughout the course of the vacation “makes the costs and how much you’re paying much more salient. You’re forced to think about it more.”
Lowenstein continues to tout the advantages of paying for the majority of your trip before you leave. “If you already paid for it, then it feels free. Otherwise, on the last day, you’re thinking, ‘Oh no, when I get back I’ll have to pay for this.’”