Will the coronavirus outbreak force hotels to adapt to new technologies quicker?
With the recent global coronavirus pandemic, it’s safe to say that the tourism and hospitality industry is taking a massive hit. For hotels, a room that is not sold today is lost revenue forever. So, hotel owners and managers are reeling, trying to come up with a plan to address coronavirus, but more importantly, to have strategies to recoup their losses once this current crisis passes.
For whatever reason, hotels are known to adapt slowly to new technologies. But with the outbreak of the coronavirus and the consequential plummet in hotel guests, businesses that do not adjust their strategies and embrace new innovations – and fast – will likely see their end. The information flow from the hotel to a third-party vendor is already weak. Without an effective method for communication, hotel vendors are forced to deal with errors, mistakes, and miscommunications, leaving them at a financial disadvantage. How many bookings are they missing out on because a potential guest wasn’t aware of a unique feature? How many times does the front desk have to whip out an upgrade to avoid a bad review from a disgruntled guest because someone else made a mistake the hotel was not even aware of?
There’s a lack of communication and a lack of control of their distribution network in hotels these days, and this is something that has to change. Before the current crisis, what might have been just a nuisance that was somewhat acceptable can now drive them out of business in no time with the added losses from travelers just not traveling, it can drive them out of business in no time.
From the current coronavirus outbreak, hotels can learn a valuable lesson — they need to be at the forefront of innovation. Not only for their own sake but for their guests and for their vendors. They need to take charge of the information distribution process and communicate changes quickly, efficiently and in a structured manner. In order to successfully raise from the coronavirus crisis, they need to get the word out. Not only work with bigger OTAs or pray for direct bookings. Being accurately showcased on as many booking channels as possible, with as much information as possible is key to their future success and their fight for survival.
According to Kevin Czok, while there is still a reluctance from hotel owners to share numbers, “with airlines discontinuing many of their flights now far beyond only their Chinese destinations, the impact on tourism and business travel is massive. China has become a top source market for tourism across the GCC. Reuters reported a 15.5% rise of almost one million Chinese visitors to Dubai in 2019 and similar growth was expected for the years to come. Given the new circumstances, one can only imagine how drastically these estimations will now need to be adjusted for 2020.”
He added, “Hotels are scrambling to attract guests with short-term measures, such as heavy discounts and free add-ons like shopping vouchers, spa packages and tickets to local attractions. Such offers can attract local residents for a staycation, to make up for the steep drop of international guests. But more importantly, hotels can seize the moment and overthink their strategy for long-term success: Communicating their offers clearly and comprehensively with a carefully planned multi-channel strategy has become more important than ever. Retention can be increased by honoring loyalty and rewarding those guests who have stayed faithful throughout these tough times.”
CN Traveller recently posted a story on How Hotel Cancellation Policies Are Changing Amid Coronavirus. The article talked about existing hotel policies and how these may need to change to cope as travel plans change and continue to. It is important to note that this situation is fluid and shifting circumstances continue to affect the policies in place.
Responding to this article, Czok commented, “Non-refundable rates are a crucial pillar of many hotels’ revenue strategy and it’s understandable that showing flexibility requires careful consideration. Many (hotels) are considering that showing leniency can go a long way in helping customer satisfaction and loyalty. Many Industry professionals were personally affected, expressing frustration and even anger, when they canceled trips to ITB Berlin and were not refunded by fellow hoteliers. But this needs to be addressed and might be a helpful trigger to adjust policies and pricing strategies.”