Hospitality Trends Post-COVID
The hospitality industry and its employees have suffered substantial losses during the COVID pandemic. Most likely, it will be 18+ months before hoteliers return to 2019 occupancy and revenue levels.
Yet, there is reason to believe that the hospitality industry has begun its ascent back to profitability. Hotel owners are now rethinking their marketing and sales plans as we begin to see merging hospitality trends for 2021. What can we expect?
Direct Channel Sales Will Continue to Drive Bookings
Direct bookings contributed nearly 70 percent of October bookings and almost 60 percent of November bookings in the fourth quarter of 2020. Hoteliers expect direct bookings to be a significant contribution to their recovery.
Decreasing one’s dependence on third-party sales networks allows hoteliers to reclaim more control of their sales channels. Savvy hoteliers can increase bookings with some of these simple tips:
- Optimize their website for Google
- Ensure that their website is mobile-friendly
- Manage online reviews
- Enhance their loyalty program
Direct sales generate cost savings — your efforts at generating direct bookings will generally produce a better ROI than paying commissions to third-party distribution channels.
Increasing Calls for Personalized Travel Search and Booking
Going hand-in-hand with more direct bookings is the need to engage with potential guests and returning guests better. A Google/ Phocuswright report shows that about 60 percent of hoteliers would profit from customizing their marketing based on their guest’s past activity and preferences.
The study also shows that three-quarters of hotel guests were more likely to join a loyalty program that focused on their personal preferences. One-third of those travelers indicated that they would pay more to get more personalized information and offerings.
Recognize the Value of Local Tourism
Almost 75 percent of all hoteliers believe that domestic tourism will lead the hospitality industry’s recovery. The pent-up demand is there. Everyone, from Gen Z to Boomers, is weary of staying at home. Potential travelers yearn for new vistas — road trips will lead the way as the United States transitions to the post-COVID period.
The post-COVID traveler values the environment and nature now as never before. These travelers value quality attractions too — museums, botanical gardens, and quality family-oriented venues.
Changing Circumstances Require Flexibility
Adjusting quickly to changes has never been more important. Circumstances during the transitional vaccination period may quickly change. New surges, even as millions get vaccinated, can create short-term shutdowns and/or restrictions.
Hoteliers must change their policies regarding cancellations and reservation requirements to meet the ever-changing circumstances of their guests. How can you add flexibility?
- Accommodating cancellation policy
- Offer credits for future stays
- Provide perks for land-based travelers, like free parking or new pet-friendly policies
- Accommodate remote-work/vacation travelers with Wi-Fi at the pool/cabana or transform an underutilized conference room with socially-distanced work stations
Bleisure Travelers: A Growing Segment for Hoteliers
Hoteliers are more likely to see more bleisure travelers. Depending on your locale, bleisure travelers could be an important segment of guests since they tend to extend their stay by a couple of days. These travelers work in every industry, but you’ll see more bleisure stays from these business types:
- Public Administration
Appeal to these frequent travelers by letting them know the amenities that your property offers, including:
- Hotel Technology — IoT devices like smart speakers and smartphone apps for contactless check-ins/check-outs.
- High Speed, Reliable Internet — offer dedicated workspaces at a small additional fee.
- Include Bleisure Amenities in Marketing — not only do bleisure travelers appreciate business amenities, but they also are drawn to amenities like a gym, spa, fitness center, or bar/lounges.
Continue to Focus on Contactless Services
Your guests appreciate the convenience and safety of contactless technology. Keyless entry, mobile check-ins, and concierge services apps entice travelers — incorporate these contactless services to enhance your guests’ hotel visit.
Nature and Outdoor Travel
Take advantage of your location — whether it’s out-of-the-way or a gateway to Nature. Travelers crave locations where national and state parks offer hiking, water sports, and nature treks. Travel to a “nature” location is expected to be high on the list of 2021 travelers.
Expect Soft Brands to Grow Over the Next Few Years
Independently-owned and boutique hotels will be more likely to join a soft brand. Travelers are looking for less-crowded destinations featuring more outdoor activities. Niche hotels located “off-the-beaten trail” are increasingly finding that joining a soft brand helps mitigate a downturn in the economy and helps them bargain for better terms with suppliers.
More Hoteliers Anticipate Holding their Pricing
Data shows that hospitality destinations that decreased their ADR during the 2008 recession required substantially longer time to recover than those who didn’t compromise pricing.
Pricing remains a hot topic among most hoteliers — on the one hand, how to maintain price integrity, and, on the other hand, how to generate sufficient revenue to, at a minimum, cover maintenance costs.
While hoteliers grapple with remaining flexible to secure bookings, they also must generate revenue. Two areas of revenue appear promising for many hospitality venues.
- Gift Vouchers. Although travelers may be reluctant to confirm a booking that they might have to miss, many potential travelers are willing to purchase gift vouchers that they can utilize at a later time when conditions for travel are more favorable. Many hoteliers are using gift vouchers as an element of their cancellation policy.
- Hotel Food & Beverage. Hospitality venues that offer food and beverage facilities will continue to capitalize on the demand for both takeout and delivery. This alternative revenue source has been an unexpected revenue generator for many hotels.
What about the upcoming months?
While no one can predict a specific location or brand’s outlook, expect some rapidly evolving situations to occur. Continue to remain flexible and focus on the trends that offer the greatest potential of taking you and your properties into our post-COVID society.