Markets across the world are now at various stages of post-pandemic recovery, and now have a view of what the hotel sector looks like following a period of lockdowns and halted travel. And though markets such as China still operate with a zero-case policy when it comes to COVID-19, and are enforcing lockdowns in some regions, much of the world is traveling again.
While safety and sanitary measures continue to be in place in many hotels, there is now less of a customer focus on COVID-19-grade cleanliness and more a need for personalized, seamless experiences. Many customers have not been on holiday for three years, and they’re ready to see the world again.
Business travel is yet to fully rebound, but this year has seen the rise of the “hybrid” traveler, who extends their business stay for leisure and takes advantage of work-from-anywhere policies. The pandemic has changed customers’ working lives for good in some cases, and there’s opportunity for the hotels sector to capitalize on these hybrid travelers.
While broadly the market seems to be stabilizing after a period of great challenge, there are two key themes affecting the market’s ability to meet consumer needs:
- First, there is a global labor shortage. This of course affects a hotel’s ability to service rooms, clean facilities, and provide an in-person, human-first experience to customers. In fact, many hotels are only able to offer half of their rooms to the public, which leads to higher cost-per-night for the customer.
- Secondly, the rising cost-of-living Is affecting the viability of holidaymaking for customers. Rising prices and a lack of personalized service could spell challenges for the sector.
Technology, of course, can provide many of the answers to questions around the labor shortage, with seamless, contactless check-in processes alleviating the need for large staff at the point of arrival, and AI chatbots answering queries to counteract the negative impact of the labor shortage. Data will remain a key source of insight into consumer wants and needs that will allow personalized experiences to evolve.
The cost of energy continues to put strain on the hotels sector, as well. In Europe, the war in Ukraine has halted the supply of gas from Russia, and consumers and organizations alike are seeing large price hikes. For many smaller, boutique hotels, this could mean closing their doors for good, while the larger corporations will need to adapt in order to cope.
In 2022 and beyond, ESG will continue to be a major factor for customer experience. Visitors want to pay for experiences with hotels that are doing their bit for the environment and local community. Travel is carbon-intensive, and customers will expect hotels to help offset the carbon footprint of their travel.
ESG commitment continues to indicate integrity to travelers, who are increasingly conscious of the carbon footprint left by global travel. Many hoteliers now have no single-use plastics in circulation, which in turn saves on cost and use of labor. The onus is on the customer to now choose to have their towels and sheets washed less often. This helps hotel ESG goals while reducing the cost of labor and energy.
Though AI chatbots continue to mature and gain customer trust, many consumers are facing lengthy delays to travel and are increasingly frustrated by the lack of a human at the end of the conversation. As the labor shortage continues to cause issues in the sector, enhanced technologies may be the answer to meet this need.
Hotel brands must leverage technology to ensure experiences live up to expectations. Leisure travel is now considered essential for wellbeing and not a simple luxury. But as the cost-of-living challenges continue, many guests will be looking for value as well as an elevated experience. Guests will expect connectivity along with clean rooms and good service.
Time & Effort
Contactless, self-service check-in can save time and effort for customers who demand seamless experiences. Technologies such as automation and AI will continue to shape this contact-free stay into a hyper-personalized, tailored experience that goes without a hitch.
Customer data will gain increased importance in the sector as brands look to understand their customers’ unique needs and further enhance personalization. Understanding special needs for a customer visit allows brands to offer services in parallel with expectations, including seamless or contactless check-in, personalized room features, and intuitive booking experiences led by the consumer.
Global financial downturns and labor shortages may create additional challenges for brands that don’t practice empathy toward their colleagues. Colleagues should feel protected and cared for by employers and supported to carry out their roles.
The Customer Experience Leaders
The hotel sector Hall of Fame features brands from budget to luxurious. Taj Hotels, Resorts and Palaces operates a range of the most luxurious resorts in the world, whereas Hilton, Marriott, and Mercure cater to customers with varying budgets, from the low-cost to more premium room rates.
Naturally, the desires of the customer will vary across levels of accommodation, and visitors to a Taj Hotels, Resorts and Palaces venue will typically have loftier demands than those visiting a Mercure resort. However, leading hotel brands such as Mercure, Hilton, and Marriott offer experiences that cater to a variety of customer needs and clientele – and with a breadth of different types of properties, these brands are clearly performing well in the customer experience index.
The experience delivered by staff on the ground is clearly integral to the customer experience for this sector. It cannot be fully replaced by even the most advanced technologies just yet. While a labor shortage is holding much of the industry back, many key players like those featured in this year’s top performing brands can attract and retain customer loyalty by offering a variety of experiences and price points.