The COVID-19 crisis has hammered the hospitality industry. But as more and more Americans get vaccinated, there is “light at the end of the proverbial tunnel.” But what is the post-COVID era going to look like for the hospitality industry?
There is pent-up demand in the vacation and personal travel sector. That sector may be the first portion of the hospitality market to rebound.
What about business travel? Here’s what business travel in the U.S. looked like in 2019.
The way that businesses conduct their businesses has changed since the COVID-19 pandemic began. What changes are likely to become permanent parts of the way businesses conduct their operations? So we have to ask the following question.
Working remotely, i.e., from home, has been well-received by employees — and employers have found that employees are more productive working from home than from the office.
No one can accurately predict what our post-COVID workforce will become. But forecasts, trends, and surveys point towards more employees working remotely than before the pandemic. Why does the evidence appear to point in that direction?
HR professionals see that white-collar employees view flexible working options as a “basic” part of an employment package, much like having a 401K. Companies who don’t offer flexible working options may find recruitment more difficult.
The desire to continue working from home varies by industry — less than 10% of distribution center remote employees would consider leaving their job if they couldn’t continue working remotely. Yet, 35% of information technology workers say that they would find a new employment opportunity to continue working remotely.
Remote-employees cite several reasons for their preference to continue to work-from-home.
The best guesstimate is that employers and employees will settle into a blended workplace arrangement, working remotely for part of the week and from home for the remainder of the workweek.
Who are the Business Travelers?
The long-term impact of working from home may turn out to be minimal. There is no doubt that the hospitality industry won’t see a rebound in corporate events and meetings in the short term. Yet, there are reasons to be optimistic for the future.
Let’s look at some facts about business travelers in the U.S.
In the coming years, the influence of millennials will begin to emerge in business travel. Millennials now exceed the number of Baby Boomers — millennials comprise 31.5% of the U.S. population. 65% of Millennials see business travel as a status symbol and evidence of their worth to their company. Millennials may conjure up reasons for a business trip when given a choice — these travelers average four business trips annually.
As more Boomers retire and Millennials move up the corporate ladder, the hospitality industry can expect to see their mix of corporate travelers change, leading to increased business travel.
Some experts predict that work-from-home implementation eliminates the need for business travel. However, statistics indicate otherwise. According to the Harvard Business Review, a face-to-face encounter is 34 times more effective than electronic communications. ROI for business travel returns $12.50 for every dollar invested, leading 90% of business leaders to deem that corporate travel is crucial to corporate growth. Business/corporate travel has five major purposes:
The reasons for travel transcend the scope of videoconferencing. Videoconferencing is an ideal solution for management-to-employee and employee-to-employee routine communication. Videoconferencing can replace a daily or weekly staff meeting.
However, videoconferencing lacks the spontaneity and immediacy that face-to-face meetings provide.
Employees are people. After over a year of work-from-home (WFH), almost everyone yearns for a return to “normalcy.” The new normal may not be quite like it was before COVID. There will be a period of transition, relaxation of restrictions will vary depending on your state and local restrictions.
Domestic business travel may rebound — especially as hotels begin to recognize the potential of providing meeting facilities that conform to the local COVID protocols for in-person meetings. The hospitality industry is uniquely positioned to be part of transitioning back to normal by offering:
WFH employees are weary of the daily drudge and will, likely, embrace work and industry events conducted at hospitality facilities that are spacious and receptive to following local COVID protocols as the U.S. transitions to a post-COVID new normal. The time to plan for post-COVID is now.
https://www.mckinsey.com/featured-insights/future-of-work/the-future-of-work-after-covid-19#
https://www.ustravel.org/answersheet
https://www.stratosjets.com/blog/business-travel-statistics/
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 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:
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.
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.
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.
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?
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:
Appeal to these frequent travelers by letting them know the amenities that your property offers, including:
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.
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.
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.
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.
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.
https://www.hospitalitynet.org/opinion/4102637.html
https://www.ezeeabsolute.com/blog/increase-direct-hotel-bookings/
https://www.eater.com/22315853/how-hotels-adapt-innovate-covid-19-creative-safety-measures
https://www.revfine.com/bleisure-travel/
https://www.hotelmanagement.net/own/soft-brand-collections-new-norm
The past year of pandemic, with its widespread “stay at home” orders, focused public concern on air quality, toxicity, cleaning agents and sterilization methods. This is especially true for hotels, restaurants, transportation industries and various others that serve large crowds. Particularly hard hit since March 2020 are service providers that deal in face-to-face situations.
It is no exaggeration to say that businesses and industries unable to pivot quickly to meet new demands for health and safety were left behind, and they will face greater comeback challenges when restrictions are relaxed or lifted completely.
The pandemic changed the focus of business; priorities had to be reevaluated in the midst of chaos, and health and safety of both employees and the public became the number one concern. It remains so today.
The groundwork for healthy buildings was laid more than two decades ago, with green building practices. While sustainability and energy efficiency today are decidedly mainstream concerns, builders and consumers alike now recognize that overall building health goes far beyond the principles of sustainability and resource conservation. The fact that the built environment is a prime determinant of human health is widely acknowledged by environmentalists, physicians, mental health professionals and social workers.
Homes and office buildings are, in effect, miniature eco-systems, and they affect human wellness in myriad ways. Statistics confirm that Americans spend as much as 90% of their time indoors or in enclosed spaces. It is also widely acknowledged that more should be done to assure human health and safety in the workplace and in public spaces as well as at home.
The practices, procedures and products that are key components of healthy buildings constitute a new paradigm. Solutions had already been envisioned prior to the pandemic, but the worldwide spread of an unknown virus was a catalyst to propel those solutions forward.
The practices, procedures and products that are key components of healthy buildings constitute a new paradigm. Solutions had already been envisioned prior to the pandemic, but the worldwide spread of an unknown virus was a catalyst to propel those solutions forward.
While it has long been known that indoor pollutants contribute to jobsite inefficiency in terms of lost time and employee healthcare costs, not enough emphasis has been placed on overall air quality until now. The recognition that heating and air conditioning systems can transmit disease will should prompt revolutionary changes to ventilation systems, filtration and manual heating and cooling controls. Lighting quality and the potential for using light to sterilize indoor surfaces is another area that bears more research. The benefits of natural light and outdoor views are proven to improve concentration and alter moods. In buildings of the future, it may no longer be enough to eliminate chemical pollutants and synthetic materials. They are destined to become more organic spaces, in all the best ways, offering more comfort and designed to promote well-being.
At the very least, response to the global pandemic has focused public attention on what can and must be done to ensure that buildings do not contribute to a growing health problem for this country, and for the world.
In 2014, Mahesh Ramanujam, COO of the United States Green Building Council, spoke in Beijing at the Tenth International Conference on Green and Energy-Efficient Building and New Technologies and Products Expo.
He noted that there is one undeniable truth. “Buildings have a lot to do with our external and internal environment, and have a major impact on both our health and the health of future generations,” he said.
This prescient leader also stated at that time:
“The built environment has profound effects on human health and the world around us. At their best, our buildings and communities are powerful promoters of health and well-being. At their worst, they contribute to some of the key public health concerns of modern society, from asthma to cancer to obesity.
“While health has always been at the core of green building, our world today is confronting massive health challenges that are assaulting “our complete physical, mental and social well-being,” the World Health Organization’s definition of human health. As these challenges continue to mount all of us have an obligation to be more purposeful when addressing how human health relates to our built environment.”
Since 2014, major changes have been introduced in building technology to focus on new categories of environmental impact. The Leadership in Energy and Environmental Design (LEED) certification, first developed in 1993, has evolved from the original version that simply sought to minimize the damage caused by a building project. It now focuses on broad new categories that address human health, biodiversity and community, climate change, water resources, the green economy and natural resources.
By improving the physical space of both businesses and homes though implementation of new technology and a renewed emphasis on quality of life, the benefits accrue to individuals as much as to business success and profitability.
Over the course of the last year nearly every business sector has been adversely affected by closures, restrictions and limitations. The tidal wave of financial and logistical consequences is only now being tallied. As business begins to ramp up, it should be obvious that some alterations to business as usual will become permanent.
There will undoubtedly be stringent new requirements in place for sanitation and individual protection, perhaps for routine health testing and evaluation. The public demand for services has also changed, with online ordering, home delivery and take-out food seen, at least in some areas, as the new normal.
Whether travel restrictions are rolled back completely or new mandates take their place remains to be determined. But such things as contact-free ordering and payment options, home deliveries, curbside pickup of groceries, and a modified form of social distancing are likely to be with us for the foreseeable future. Workplace planners are already rethinking options for offices, warehouses and manufacturing facilities in light of new findings regarding disease transmission during the pandemic. The changes prompted by remote employment and the online business are already apparent.
Obviously, some business segments have been affected more than others, notably convention facilities, sports venues and the cruise industry. Alll are reviewing options as they plan to move into a post-COVID world.
Whatever that world holds in store, there is widespread agreement that the emphasis will remain on health and safety, human well-being and protection. There is a new and welcome awareness of the environmental factors over which we have some control, specifically the buildings in which we spend the majority of our time.
https://www.usgbc.org/articles/healthy-buildings-and-healthy-people-next-generation-green-building