The international hospitality industry is anything but nice. There has been no innovation in this area for a very long time, but the arrival of technology fueled by a demand-driven economy has dramatically changed that. The advent of Airbnb on the scene was an indicator of this change, along with the rise of boutique hotels. Soon, even traditional restaurant chains began to experiment, grow, acquire and, as a result, innovate intensively.
This brings us to the current hospitality scenario. Although it continues to be a brutal, steadfast and fiercely competitive industry, the path to success is already multifaceted. There is no one formula that applies to everyone and hotels no longer have to subscribe to strict and fast rules. Technology plays the role of a great equalizer, giving even the youngest player a chance to survive.
Across the world, the travel, tourism and hospitality sectors remain key to economic development and job creation. In this economy where transport becomes more accessible and the country's borders are blurring, it is fair to assume that travel and tourism will remain the dominant sector for the near and far future.
Consider these statistics:
In 2016, Travel & Tourism contributed $ 7.6 trillion to the global economy and supported 292 million jobs.
This revenue generation represents 10.2 percent of the world's GDP.
1 in 10 of all jobs can be attributed to the tourism industry.
At 77 percent, leisure travel made up some of people's expenses. In comparison, corporate and business travel remained 23%.
Domestic travel (at 72 per cent) is higher than international travel.
Total contribution to GDP increased by 3.1% in 2016.
By 2027, this sector is likely to represent 11.4 per cent of world GDP and support more than 380 million jobs worldwide. Of course, this shows that this sector will outstrip the global economy.
There is no doubt that companies like Airbnb compete directly with hotels in certain segments of the market. This means that part of the business may be an addition as travelers take more trips (and longer ones too) than they would without the option. What is important, however, is that private accommodation has changed consumer expectations at a fundamental level, redefining what and where a hotel is.
The competition in the hotel industry is the result of two aspects:
As I said, technology leverages the playing field and contributes to various aspects of the industry, including branding, communication and extensive work. There are three specific trends in particular
will change the hospitality industry in the coming years. Let's look at each one individually.
Mobile first approach
In emerging markets around the world, it is estimated that 1 billion people will come online worldwide. Most of them will be customers who will live out the entire guest lifecycle of their smartphones. The hotel and tourism companies have no choice but to invest in mobile and mobile guest and retention strategies.
In any case, customers are always looking for that "personalized" experience and using innovative mobile technologies like AirBnb and Uber will be key when it comes to brand differentiation and experience. Hotels will need to offer booking features, lightning operations, and other touch points for the entire customer journey on mobile phones for the convenience of their customers.
As access to the Internet becomes almost unlimited for both digital locals and foreigners, the connection is poised to increase. In addition, with the proliferation of connected devices and wearables on the market, hotels will need to be innovative when it comes to new ways to interact and interact with the consumer. Virtual reality tours, augmented reality, robotics and AI will drive the market and set it up for more trips that can be delivered in practice.
Machine learning, big data and analysis
Using Big Data allows you to create and validate a broad, personalized experience for any type of user. Many marketing campaigns can be used seamlessly and monitored, given tangible numbers for growth and further optimization.
It also accelerates existing processes such as customer service, feedback collection, email automation and customer engagement. In addition, it can facilitate scale-up and downsizing of business to company goals.
Change profiles and brand experience
The travel industry is witnessing a shift in travelers' psychographic and demographic profiles. Along with Gen X travelers, there is a new influx of millennials whose expectations and lifestyles set completely different standards of productivity in the industry.
Currently, customer experience is the most dominant brand differentiator. It will drive customer loyalty and will require referrals and hotels to synthesize more targeted, personalized and sophisticated loyalty schemes than ever before.
This personalization and differentiation extends to the types of experiences you create. The concept of "home away from home" eliminates the homogenization of luxury, as the paradigm tested earlier.
Now, to provide unparalleled service, the rooting of a hotel in its local climate, while providing experiences outside the conventional hotel space, has become an important consideration. The millennial demand for organic food and sustainable options also creates more vulnerabilities when it comes to risks and food safety that must be monitored by hotel owners.
Travel brands have also been abandoned by non-travel brands who have impressed customers by providing increased levels of service. Amazon, Starbucks, and Uber are a few names that are widely respected by millennials, and competition will only intensify as customers begin to expect the same from every service provider, especially the player in the hospitality industry.
This brings us to the last point – marketing for this new-time user. Hospitality sales, as they are, are different from other consumer goods. This is because both tangible and intangible products have to be sold by the player. Success then depends more on providing marketing "services" rather than simply encouraging the consumer to buy what you offer. It is important to create the right brand image that fosters trust and also conversions.
Permanent brand identity also becomes more important as customers have multiple fronts on which to engage your brand. Your active presence on social media becomes very important as a customer engagement portal.
Customers can also explore and appreciate you better through portals like TripAdvisor and Yelp. The reviews and recommendations of a friend or influencer suddenly become very important determinants of sales growth. In addition to providing a steady stream of revenue, multiple customers can become influencers themselves.
Using all the tools and technologies that come with digital marketing is not only time-consuming, but also much cheaper and more accurate to your customers preferences. Email and content marketing is now closely tied to SEO and brand visibility across the web. Most of these marketing efforts are about creating, maintaining and maintaining brand identity and image. Continuously attracting customers with the best new marketing practices, in addition to providing an invaluable experience, will be what drives you above and beyond your competition.
At the moment, the sector is extremely profitable and ready for huge growth and favorable investment. If you are an existing player who is not performing well, or a new player who wants to make a significant dent in the industry with all these points in mind, it will give you a significant advantage over your competition.