Ignacio Fernandez was the first speaker to address EU Business Students in 2021, and his presentation could not have been more timely. As lockdown restrictions begin to ease up internationally, the prospect of travel is making a return to the imagination of the general public.
Throughout his 15-year career in this industry, Ignacio has seen significant change occur. He explained to students how the once-traditional sector of hotel hospitality is now reinventing itself to the modern context and responding to the impact of COVID-19.
Ignacio works at the Renaissance Hotel in Barcelona, one of Catalonia Hotels and Resorts which exist in a franchise relationship with Marriott, the largest worldwide hotel chain in the world.
Certainties and Challenges
Although the travel industry has been one of those most adversely affected by the pandemic, it is built on the solid foundations of an international passion for traveling. This passion remains, meaning that when it is safe to do so, people will travel again. Why? Simply put: there is an inherent human need to share moments and knowledge and to experience other cultures.
Obstacles can be found in health concerns, professional restrictions, and doubts surrounding current regulations. Naturally, people want to take personal responsibility in preventing the spread of Coronavirus. There are also companies who have advised their employees against traveling right now. Potential travelers are likely to worry about new safety procedures in place; in particular, how they may impact their ability to travel as well as their overall enjoyment of the experience.
To capture demand in 2021, Ignacio outlined some travel trends that hotels need to act on:
- Consumers will be more money-conscious than before, due to the economic impact of COVID-19, which means that hotels now need to price their services in accordance.
- Online travel agencies will become even more dominant. Thus, it is important that hotels are positioned attractively on these sites if they want to attract customers.
- Remote working is here to stay. Offering co-working spaces or long-term stays at a reduced price may attract a different kind of customer to the traditional holidayer.
Smaller hotels are less likely to have survived the pandemic due to reduced revenue. Large chains are the ones that have the economic resilience to sustain themselves through tough times. Therefore, it is likely that many independent hotels will have been bought and taken over by the big names in the industry.
The future of the hotel industry will depend on a range of factors beyond its control. One crucial factor is the successful rollout of Coronavirus vaccines internationally. Another is the level of public aid that is granted by governing bodies. Ignacio mentioned that the future of small, independent hotels in Barcelona will be largely determined by the financial support they receive from the state.
He predicted that the demographics of those who travel will change too. Unfortunately, travel has become economically impossible for many of those affected by widespread job loss. From this, it can be assumed that wealthy people are the ones most likely to travel in the near-future. With this in mind, we should expect a boom in luxury tourism and greater polarization when it comes to tourist consumption.
Having spent so much time at home, it makes sense then that many people are now craving encounters with nature and trips away from their hometowns. Domestic tourism is a potential point of development, and it may be enough to support the hotel industry while international customer levels are greatly reduced.
Despite the fact that revenue levels have generally suffered a significant decrease, hotels face an increased demand from customers to invest in technology and digitalization. In the near-future, we are likely to see robots performing tasks such as check-in and disinfection in hotels.
Increasingly, customers also expect to enjoy Amazon Alexa technology in their rooms. This allows them to make adjustments to the temperature and lighting with their voice alone. They also respond well to digital services that, for example, allow them to access room service directly through an app.
Customization is a trend taking shape across many industries, and the hotel industry is no exception. Ignacio stated that the “average” traveler no longer exists, and instead hotels must try to customize the experience they offer to the needs of each individual customer. This also applies in marketing, where social media can be used to carefully locate advertising in line with customer interests.
A smart hotel makes use of internet-connected devices which are capable of communicating and interacting with one another. Ignacio predicted a move towards integrating smart hotel technology across the industry. One positive of this is that it results in more sustainable hotel rooms: if the room knows when it is empty, energy can be saved by turning off appliances.
Smart hotels provide improved levels of personalization and easier access to information too. Data can be collected so that hotels can make decisions based on the known preferences of their customers. It also saves time for staff members if customers are able to have their enquiries answered efficiently, for example, by consulting Alexa. Customers experience this as excellent service.
Meetings and Events
Of course, hotels are not just used by holidaying guests. They are also popular locations for conferences, which have been utterly transformed by COVID-19. Participant numbers will be limited for some time, and hotels whose spaces are simply not large enough to guarantee social distancing will also be excluded as a venue option.
In his insightful talk, Ignacio explained how the development of hybrid events had changed the game when it came to hosting conferences. Gone are the days where he might expect around 3,000 guests at this kind of event. Now, most follow a hybrid model with limited in-person participation. Their wider audience participates through online streaming, meaning they do not need hotel rooms.
In response to this need, Ignacio’s hotel is currently in the process of introducing a range of virtual tools such as live video tours, webcasting facilities, and even virtual reality equipment. Ignacio considers these to be wise investments because he believes that online meetings are here to stay.
The Need for Confidence
For customers to start traveling again, Ignacio stated that they need to have confidence in a range of different factors:
- Economy – They need to feel secure enough financially to invest in travel experiences.
- Health – They need to feel protected and know that health care is available as they travel.
- Transportation – They need to be able to trust that transport systems will run reliably and efficiently.
- Technology – They need to be able to access information and services with ease.
The future of the hotel industry depends on this.