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Marie Merry

Marie Merry

As we start a new year, we can see the hotel industry is starting to recover post-pandemic and Brexit, yet the market is faced with new trends that many thought wouldn’t be with us for another decade. In this article, High Level Software addresses the top 7 trends emerging in 2022 and how astute hotel owners can turn them into new opportunities.

Not only has the pandemic accelerated new technology in the industry, it has also seen new customer segments born with virtual or hybrid events, remote working, traveller preferences and sustainability. Additionally, Brexit has played a crucial role in job vacancies with openings up by 59.1%.

The industry is changing faster than ever before and it is imperative for hotels to explore these new trends and opportunities in the race to remain competitive. This article will look at the main trends emerging in the industry:

  • Environmental sustainability
  • Changing workforce
  • Business travel and corporate demand
  • The decline of the traditional travel agent
  • Delivering personalised stays
  • Revenue management
  • Innovation in hotel technology.

Environmental sustainability

The pandemic didn’t start with the focus on sustainability, but it has seen a new wave of positive change towards the environment from Gen Z to millennial consumers. Guests now want to stay in hotels that have integrated green practices in all aspects of their business.
From changes to hotel buildings and interiors to F&B menus containing meat-free options, these changes are set to stay and should be embraced by hotel owners to remain competitive now, and in the future. Hotels should consider:

  • LEED certification: a certificate that measures the eco-friendliness of a building
  • Solar power
  • No plastic initiative
  • Light motion sensors
  • Sustainable waste management
  • Vegetarian and vegan options in F&B offerings
  • Operational changes such as contactless technology and EV chargers.

A cloud-based property management system (PMS) focuses on efficiency … which should be second nature when adopting a green hotel culture. For example, remote check-in/out, paperless invoices and registration forms, which cuts down on plastic and paper waste, as well as reducing overstaffing (and the potential carbon emissions this may cause).

Changing workforce

Whilst the sector starts to bounce back from the impact of the pandemic, the same cannot be said for hospitality workers.  During the pandemic, the hospitality industry saw a 21.5% increase in unemployment (Office of National Statistics) in the UK, but Brexit has further exasperated the situation. 25% of the workforce was made up of non-UK workers that have now left the country due to more stringent migrant laws. As a result, 3 in 10 hospitality businesses are finding vacancies difficult to fill, with front-of-house staff and chefs being the most sought after.

So how can hotels turn this around? Investing in technology can help with employee retention by enabling you to lighten the load when running a hotel with a smaller team. A hotel PMS system puts you in control. By enabling you to make informed decisions about your business using real-time data, you can automate daily tasks and free up your team to focus their efforts on driving productivity and positively boosting your bottom line.

Upskilling or training staff also helps with retention by aiding progression and providing opportunities. As a result, hotel managers should look to create comprehensive training plans that clearly outline a progression structure for staff to move up through the business.

Business travel and corporate demand

The pandemic has been devastating for the business travel agency with spending in 2020 reduced by 52%. As the sector is not anticipating a return to pre-pandemic levels until 2025 (GBTA), hoteliers should start thinking about how they can claw back revenue from this industry by using other means.

With remote working set to remain, hotels should start to consider working with local businesses to provide remote working hubs for employees or on-demand meeting spaces for businesses with virtual offices.

By leveraging a cloud-based PMS, hotels can start capitalising on this rental market as a service. Setting up hourly reservations that are integrated fully with your PMS enables upgrade options and access to data and insights to maximise this opportunity.

Hotels should also consider that corporate spending will never reach its pre-pandemic numbers as potentially this segment has changed forever. This also includes Meetings, Incentives, Conferences and Exhibitions (MICE).

Research conducted by Cvent during Q4 of 2021, discovered those event planners who used their skills to organise virtual events during the pandemic are shifting their confidence in coordinating hybrid events. 46% of planners are already intending to schedule hybrid events during 2022.

The question is, how can hotels capitalise on this? Consider investing in your MICE space to ensure it includes the latest technology. From internet bandwidth and 5G capability to AV outlets, lighting and technical partners, make sure you can guarantee a seamless service for hybrid and virtual events.

The decline of the traditional travel agency

Travel agencies have been the worst hit during the pandemic. With the lack of activity during the first half of 2021 and last-minute cancellations, the sector’s turnover has simply collapsed. Consequently, this has caused a huge shift in consumer behaviour.

The rise of the independent traveller who prefers to search online, spend more wisely and book unique experiences, means the traditional travel agency has become redundant. This has been facilitated by online travel agencies (OTAs) such as Airbnb, HotelBooking.com and Expedia, making it easier to book accommodation, flights and experiences from one platform. Basically, the consumer can now find everything online that the more traditional travel agency would offer, but at a cheaper rate with more unique experiences.

To maximise your online exposure to this emerging audience, implement a PMS that has a hotel channel manager which connects with hundreds of OTAs. This enables you to reach thousands of potential guests that would normally prove difficult to access through your own marketing efforts. Other benefits include:

  • OTAs invest heavily in marketing so you don’t have to
  • Greater website visibility
  • Gives you the ability to target high-value guests
  • You get access to analytics and insights

The one downfall in this change of consumer behaviour is that OTAs charge a premium commission fee that is only set to rise with the decline in the traditional travel agencies. To reduce the reliance on OTA bookings and therefore, commission fees, hoteliers should start to leverage marketing opportunities. By enabling online direct bookings and email automation, hoteliers can increase repeat bookings through marketing and personalisation.

Delivering personalised stays

The key to boosting revenue is to increase return bookings, provide up-selling opportunities and deliver supplementary offers. By creating a connection with potential guests between your brand and business, helps to secure first-time bookings and builds relationships to encourage return visits. This reduces a hotel’s dependency on OTA channel bookings.

A hotel PMS with a fully functional marketing suite enables hoteliers to nurture guests pre, during and post-stay to allow for ancillary offers, upselling, gaining valuable reviews and repeat bookings.

Personalisation will only continue to grow as it becomes more attractive and important in the race to remain competitive.

Revenue management

Analysing occupancy rates and industry trends enables hotel revenue managers to implement revenue strategies that directly boosts the bottom line. As more hotels start to implement intelligent technology, the pace of revenue management will only continue to rise post-pandemic.

The basic strategy behind revenue management is for revenue managers to identify patterns and to react to them by implementing revenue management campaigns that will increase bookings and ultimately increase revenue.

For revenue management strategies to be successful, hoteliers need a platform that enables revenue managers to create and manage rates, packages and rate strategies for any number of hotels at the push of a button.  Platforms like High Level Software increase occupancy, RevPAR and ADR, by providing features that include:

  • rate-hurdles
  • occupancy-based pricing
  • deposit rules
  • automated price increases
  • instant rate management across all OTAs.

The revenue manager should be a senior member of the team as they need the flexibility to discount rates and implement promotional strategies that respond to the market needs. So, whether that’s accommodating cancellation policies, applying additional discounts for upselling rooms or increasing length of stay, they should have the permission to implement as required.

Innovation in hotel technology

Although we are seeing new trends and segments emerging in the hotel sector during 2022, the main underlying theme on how hoteliers should respond to the changing market needs centres around new technology.

Innovation in hotel technology is increasing at a rapid pace and to remain competitive, hoteliers should start investing. Advances in PMS systems means that hoteliers and guests have exciting new opportunities when it comes to booking, paying and experiencing a hotel stay. These include:

  • Enabling upselling room upgrades, F&B options, tours and other addons
  • Channel management from one platform
  • Revenue management for pricing optimisations for room rates
  • Online guest engagement with an owned device
  • Contactless check-in/out
  • Online responsive booking platform to improve direct bookings through mobile devices
  • Fast internet speed for hybrid events or virtual events
  • Contactless payments and room keys

 

To summarise, the hotel industry has been propelled 10 years into the future, which has been made possible through the advances in technology that ensured the industry survived the pandemic. But now we are seeing signs of recovery, the astute hotelier should be leveraging these opportunities to become a market leader in their sector.

So, whether you are a small B&B, independent hotel or a group of hotels, emerging technology is here to stay and only investment will ensure you remain competitive in 2022 and beyond.

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