STR shared some grim news recently about the state of the hospitality industry. While it should come as no surprise to anyone paying attention, all key performance metrics show that 2020 was an abysmal year for travel. While we will see some recovery in 2021, it’s still far below where we were in 2019.
What does recovery look like? STR predicts that large events and long-haul international travel won’t begin until Q3 2021 with essential meetings, small and medium gatherings and regional international travel beginning in Q2 2021. Full recovery won’t come until 2024.
While we wait anxiously for the vaccine to end this nightmare and alleviate people’s fears, there are some bright spots we can celebrate as we head into the holidays.
First, brand generated demand has picked up. Guests are going directly to brands to book their stays, which means that your email marketing and digital programs are working. (Do you hear the cheering from Revinators around the globe?) Property direct is seeing 27% demand share and brand.com is seeing 25%. OTAs is at 16%.
Second, leisure travelers are still packing their bags and hitting the road. This segment only saw a 15% drop since last year. These people are tired of being home and are proving that they’re willing to take a risk to enjoy a getaway. In fact, local travel, or those within driving distance of the hotel, is the highest it has ever been. And, of the people that had to cancel or postpone travel because of the pandemic, 73% expect to travel over the next 12 months (Revinate Traveller Survey). And the good news is that these people are looking for familiarity. In fact, 68% of travelers we surveyed said they want to go back to hotels they have stayed before so if you’re not engaging with your past guests, now is a great time to start.
Third, hoteliers are getting creative and it’s paying off. We’re seeing hotel revenue expansion through non-traditional uses of the property. In some hotels, meeting space is being converted to office space to accommodate people who might not be able to work effectively from home. A great example is the Roger Smith Hotel, which capitalized on the growing population of at-home workers that needed a better work set-up. We’re also seeing hotel rooms being used for private dining rooms, ensuring that diners who still want to be pampered have safe space without having to eat in their own guest rooms.
And, of course, we’re seeing hoteliers really up their game when it comes to engaging their local guests. They’re focusing on personalizing offers and experiences that get the attention of drive-to travelers. This is building loyalty and bookings, in addition to tremendous FOMO.
Finally, in what must be my favorite phrase of 2020, we’re starting to hear more and more about “revenge travel.” While it sounds violent, it’s just the phenomenon of being so frustrated with 2020 that you can’t wait to get out and travel your faces off at the first opportune moment. So many people are expected to travel that experts are predicting 30% occupancy overflow post Covid.
While we can’t guarantee you a hotel-full of revenge travelers in Q1, we can help you drive demand in what is likely your best promotions window of the year – – black friday. Review the recording from our webinar last week and get your promotions ready, stat!