The international hospitality industry is anything but kind. For a lengthy time, there was next to no innovation in this area, but the advent of technology-fueled on-demand economy has radically changed that. Airbnb’s appearance on the scene was an indicator of this change, together with the rise of boutique hotels. Soon, even traditional restaurant chains started experimenting, growing, acquiring and by consequence, innovating intensely.
This brings us to the present hospitality scenario. Although it continues to be a brutal, unyielding, and fiercely competitive industry, the route to success is currently multifaceted. There isn’t one formula that applies to all and resorts no longer have to register to hard and fast rules. Technology plays the role of a grand equalizer, providing even the smallest player a fighting chance to live.
Around the world, the travel, tourism, and hospitality sectors remain a key for economic growth and job creation. In this market where transport has become more economical and country borders are blurring, it is fair to suppose that travel and tourism will remain a dominant industry for the near, and much, futures.
Consider these statistics:
In 2016, Travel & Tourism donated US$7.6 trillion into the global economy and encouraged 292 million jobs.
This revenue generation comprises 10.2 percent of the world’s GDP.
1 in 10 of all tasks can be attributed to the Travel & Tourism Industry.
At 77 percent, leisure travel made up a chunk of people’s spending. In comparison, corporate and business travel accounted for the rest of 23 percent.
Domestic travel (at 72 per cent) was higher than global travel.
The whole contribution to the GDP was boosted by 3.1percent in 2016.
By 2027, this sector is very likely to account for 11.4 percent of the global GDP, and will support more than 380 million jobs worldwide. Of course, this indicates that this sector will outperform the global market.
There’s little doubt that companies like Airbnb are competing head-to-head with hotels in certain segments of the market. However, what is important is that private accommodations have shifted consumer expectations on a basic level, by redefining what and where a hotel is.
Changing customer profile
Like I said before, technology has leveled the playing area, and contributed to various facets of the business, including branding, communication, and outreach. In particular, three particular tendencies are
Going to reshape the hospitality industry in the next few years. Let’s look at each on them separately.
In emerging markets around the world, 1 billion people are expected to come online worldwide. Most of these can be customers who will experience their entire guest lifecycle on their smartphones. Hospitality and travel companies don’t have any choice but to invest in mobile friendly and mobile-first guest engagement and retention plans.
Regardless, customers are constantly looking for that’personalized’ expertise and leveraging innovative mobile technology the way AirBnb and Uber have will be key when it comes to brand differentiation and experience. Hotels will have to provide booking functionalities, lightning quick operations, and other touchpoints for the entire customer journey on mobile phones for the convenience of their customers.
With internet access becoming almost limitless to digital natives and non-natives alike, connectivity is only poised to increase. Besides, with the proliferation of connected devices and wearables in the current market, hotels will have to find innovative when it comes to new ways of interacting and engaging with the consumer. Virtual reality tours, augmented reality interactions, robotics, and AI will drive the industry and poise it for yet other travel experiences which can be vicariously delivered.
Machine Learning, Big Data and Analytics
Tapping into big data allows for the creation and curation of an extensively personalized experience for every type of consumer. A lot of marketing campaigns can be leveraged seamlessly, and tracked keeping tangible numbers in mind for expansion and further optimization.
Additionally, it speeds up existing processes like customer support, feedback collection, email automation, and customer engagement. Furthermore, it may also ease upscaling and downsizing the company according to company goals.
Shifting customer profiles and brand experience
The tourism sector is seeing a change in the psychographic and demographic profiles of travelers. Along with Gen X travelers, there is a fresh influx of millennials, whose lifestyle and expectations are setting entirely different standards for business performance.
Customer experience is now the most dominant brand differentiator. Additionally, it will drive customer loyalty and referrals and resorts will be necessary to synthesize more targeted, personalized, and intricate loyalty strategies than ever before.
This personalization and distinction also extends to the sorts of experiences that you create.
Now, to provide unmatched service, rooting the hotel in its local climate while also giving experiences beyond the traditional hotel space, has become an important factor. The millennial demand for organic food and sustainable choices also generates more vulnerabilities when it comes to risks and food safety, which has to be monitored by hotel owners.
Travel brands have also been left behind by non-travel manufacturers that have pampered the clients by providing heightened levels of support. Amazon, Starbucks, and Uber are a few names that millennials hold in high esteem, and competition will only intensify as customers start to expect the same from every service provider, particularly the hospitality industry participant.
This brings us to the final point – marketing for this new-age consumer. Hospitality sales, as it is, are different from other consumer products. This is because both the tangible and the intangible products have to be offered by the participant. Success, then, hinges more on providing marketing’services’ instead of simply prodding the consumer into purchasing what you’re offering. It’s important to make the ideal brand image that promotes trust, and furthermore, conversions.
A consistent brand identity also becomes more important as clients have a lot of fronts on which they may engage your brand. Your active presence on social media becomes very important as a portal for customer engagement.
Customers may also research and evaluate you better thanks to portals such as TripAdvisor and Yelp. Reviews and recommendations of a friend or an influencer suddenly become very important determinants for growth in earnings. In addition to providing steady revenue flow, repeat clients can become influencers in their own right.
Leveraging all the tools and technologies that come with digital marketing is not only the need of the hour, it’s much more economical and fine-tuned to customer tastes. Email and content marketing are now intimately tied in with SEO, and brand visibility across the net. Most of these marketing efforts enter carefully creating, curating, and maintaining brand identity and image. Continuously engaging the clients with new-age best marketing practices, in addition to providing an invaluable experience will be what takes you above and beyond your competition.
The sector is very profitable at this time, and is poised for massive expansion and favorable amounts of investment. If you’re an existing player that is not performing very well, or a new player looking to make a significant dent in the industry, keeping all these points in mind will give you significant edge over your competition.