I am currently at an ACCC conference on the Gold Coast. While there is a water crisis here, the hotel I am staying at does something common to all hotels these days; it asks you to think about whether you want your towels and sheets changed everyday. Here is the plea on a little card:

We care about the environment. We are committed to undertaking practices that preserve our natural resources … Working together, we can conserve millions of litres of water, save energy and minimize the release of detergents into the environment.

Now a colleague who was on a tad on the political right objected to this imposition by the hotel pandering to the ‘greenies.’ He indicated that he would prefer to stay in a hotel without such policies. I think he is a moron. Let me explain why.

Here is how I read the hotel card:

We care about our shareholders. We are committed to undertaking practices that contain our costs … Working together, we can conserve millions of dollars of costs, save energy and minimize the release of funds to laundries and detergent manufacturers.

I love this policy. It is clearerly profit maximising and at the same time can be pitched to customers as something socially responsible. If you want to be socially responsible, you are. But if you don’t — like our anti-environmentalist friend — you also win. By saving costs, competing hotels pass on the savings to their customers in the form of lower room charges. If you still choose to have your towels changed everyday you can but you still get the benefit of sharing in the cost savings from the greener customers. If there was a hotel that didn’t have such a policy and you went to it, you would pay more and still have clean towels. Hence, you would be a moron.

The reason for this wonderful win-win is that you can also read the card this way:

We care about resources. We are committed to undertaking practices that preserve our resources … Working together we can save millions of litres of water, detergent and towel washes, save energy and minimize the use of a service some people don’t value.

The point is that hotels found a way not to bundle into their product something that many people didn’t value — daily towel and sheet changing. Why did they know this? Because those same people don’t practice this in their own homes. And for the most part they are not thinking of the environment but the actual resource costs of washing. Regardless of whether they are in their own home or a customer of a hotel, that lack of value persists. Hotels have found a way to unbundle that part and they do not even have to go through the difficulty of charging for the service. Very easy.