Three Obvious Changes in the Hotel Business

Three Obvious Changes in the Hotel Business - Time for Change

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With the lifting of travel restrictions, hotels are preparing to reopen. But we know in the coming months or years, we will not able to return to what we were familiar with. There are many more new challenges than social distancing in the new normal. These are just three obvious changes in the hotel business after this pandemic. 

Sales & Marketing: New Revenue, Pricing & Distribution Strategy

Every hotel has its own revenue, pricing and distribution strategy to fit certain source markets. Before the pandemic, hotels had filled rooms by certain markets in different seasons. COVID-19 became a key driving factor to push hotels to redefine their business strategy. How to capture the first-recovering market and segment became a race between hotels. 

Hotels need to rethink their revenue strategy in order to develop a new market. Prepare to keep optimising it as the travel restrictions keep changing during the crisis. As hotels enter an unfamiliar market or segment, detailed market research needs to be done in order to design an effective market strategy. 

What is the pricing strategy for this market? What distribution channels work well in this market? How to accommodate individual business travellers instead of conference groups? There are many questions to be answered. Hotels which are able to answer these questions will have the highest possibility to capture these new markets.

What is your hotel’s new business strategy? Have you started to prepare for changes? Are you ready to embrace the new world?

Operations: New Cleanliness and Sanitation Procedure

Cleanliness and sanitation of the hotels are becoming the main guest concern while staying at a hotel. The confidence in cleanliness and sanitation will become key drivers of the hotel business. Hotels need to take immediate action of having new hygiene standards and procedures. Hotels that are doing this well would gather market attention and benefit first once the market is reopened. 

Communication will also increase the confidence of cleanliness and sanitation. The guidance of cleanliness and sanitation procedures are what travellers expect from hotels. Clear signs of sanitation would make guests feel comfortable during their stay. In the near future, hotel hygiene certificates (by the local government or third parties) will be displayed on the OTAs website as well.

Hotels should move to prepare this in advance instead of waiting for local authorities to enforce these standards.

Management: New Performance and Productivity Indexes 

Strict measures to prevent the spread of the virus, like Social Distancing and Capacity Reduction would change the way we work. Hotel management has to rethink the KPIs in terms of performance and productivity.

With social distancing measures, the hotel’s front-office will lose the opportunity to upsell the hotel’s ancillary services or room upgrades to guests upon check-in. It’s difficult to maintain this performance index for front-office staffs.

With the Capacity Reduction measures, some hotels are implementing leaving rooms empty for 24 hours before the next guest occupies it (For example, Chroma Hospitality). In such scenarios, the productivity index of the housekeeping team might be changed. The Hours/Occupied Room is not the correct indicator to show productivity. 

Have you thought about the new indexes to measure performance and productivity? 

These are just three obvious changes to the hotel business. We will see more changes to come, in these uncertain times. Hotels who are prepared to embrace these changes will ultimately win the market in the new world.

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