For months, you’ve read and watched people attempt to forecast when travel will go back to normal. Spoiler alert: They’re all wrong. Not because these forecasters aren’t smart, knowledgeable, or serious thinkers. But because they assume we’ll “go back.” And that’s simply not going to happen.
There is no going back. We can only go forward. We live in a different world now. Your guests have been adapting their behaviors to a different world for most of a year. They live their lives online. And, yes, it turns out that some parts of living your life online are terrible. It’s clear that guests want to travel, to visit other places, to sit face-to-face with friends and family without being separated by a hazmat suit.
But some parts of living life online are… pretty great, actually.
Business Travel is Over… Kind Of
Fifteen percent of senior executives surveyed by McKinsey expect that at least one in ten employees could work from home regularly after the pandemic – with much higher numbers in specific industries. No one misses lengthy layovers to get to a two-day offsite or client meetings better conducted virtually. And while almost two-thirds of workers can’t work remotely, most of those are in jobs that didn’t travel much pre-pandemic either. We’re looking at some meaningful shift there.
Bill Gates has gone further, suggesting that over 50% of business travel will disappear permanently. Yes, Gates’ prediction seems far too high; after months of Zoom fatigue, many regular business travelers are desperate to return to the road. But there will be fewer offices to visit. Business travelers aren’t going to drop in on clients at home. Even if we assume Gates is off by a factor of five, a permanent 10% reduction in business travel represents hundreds of billion dollars of negative impact to the travel economy.
Leisure Travel is Shifting Too
Similarly, leisure travelers are learning new lessons as well. Consumers have learned that alternative accommodations and delivery services suit their lifestyles. Families have learned kids don’t have to be in school every day to learn. The ability to work from anywhere is leading guests to book longer stays. Airbnb and DoorDash thought that now was the right time to launch their IPOs for a reason. Of course there are still challenges. The frequent shifts and confusing rules associated with government lockdowns leave lots to be desired. But your customers have learned to appreciate the flexibility, variety, and convenience digital delivers. What makes you think they’ll want to “go back” to the way things were?
Most travel companies continue to experience huge increases in traffic. And while bookings remain exceedingly soft, that’s easily explained by ongoing COVID fears. What odds would you give that, post pandemic, traffic levels will fall? Or that conversions will stay low? It’s unlikely that either of those are true – let alone both.
With any luck, we’ll have a critical mass of inoculations by late Q1 and experience a “normal” summer. If, as is more likely, it takes until late Q2 for the vaccine to reach wide dispersion, we could still see epic demand in late July, August, September.
Digital Transformation is “The New Normal”
The point remains that living life online and working from home has created new behaviors among consumers that will last forever. Your guests will be more digital, more mobile, and require greater flexibility even once we see mass distribution of vaccines. Microsoft’s Satya Nadella has said that the next decade of economic performance for every business will be driven by the speed of their digital transformation. And no business is more vulnerable than hospitality if we don’t adapt to changing customer needs.
Airbnb and Expedia’s VRBO are crushing it, adding new traveler-friendly features such as eliminating booking fees to guests and introducing minimal cleaning standards. Google now highlights travel brands offering free cancellations. Even Tripadvisor has introduced a subscription option – something I recommended hotels explore early in the pandemic. These digital natives are winning because they’re responding to the way customers live today, not expecting anyone to “go back to normal.”
How You Can Respond
Given these changes, what can you do? Here are a few ideas:
- Make “work from anywhere” the new normal. The distinction between business and leisure travel will get smaller. In fact, if Bill Gates is right, we need to reduce that distinction. We’ve also learned during the pandemic that time with family and friends are the greatest amenity. Encourage business travelers to extend their stay and bring their families along for some portions of their trip. Accommodate bleisure travelers with rates, packages, and amenities that acknowledge their hybrid nature. For instance, can you provide rooms or suites with “homework pods” or privacy screens and free Wifi?
- Internet, everywhere. Speaking of wifi… shoddy, expensive wifi simply doesn’t cut it today. Your guests expect to get online easily and inexpensively. They need to connect to Zoom meetings for work or school, to connect face-to-face with loved ones they’ve left behind, or simply to catch up on Baby Yoda’s latest hijinks. They’ll choose properties that make that easy and affordable. Make sure you’re one they’ll choose.
- Invest in your content. Google and other intermediaries increasingly make it easy for guests to learn everything about your property – whether you want them to or not. Don’t fight that. Instead, embrace that reality. Provide all the information that guests need to know when deciding where to stay, including amenities, local guidelines around the pandemic, and clear, flexible pricing that demonstrates why you’re the best option for their stay.
- Think in terms of “value” not “rate.” Cutting rates doesn’t drive demand. Period. And it puts you in a poor position to maximize profits when demand recovers. Think instead about offering value-added packages to guests. You must embrace a “Backyard and Bundle” or “Local, Loyal, Leisure” strategy, focused on selling a great stay, not a low rate.
These are just a few ideas. I’m confident additional changes are coming that no one’s thought of yet. What’s missing from this list? What do you expect to change? And, most importantly, how can you continue to adapt to the needs of more digital, dynamic guests?
We live in a different world. The pandemic has transformed enormous swaths of the economy and will continue to do so long after the vaccine gains ground. Your guests will be more digital, more dynamic, more mobile.
Digital leaders are responding to the world as it is, not as it was. How guests will browse and book travel post-pandemic — which behaviors will last — is outside your control. What you can control, though, is how you adapt, how you react, and how you transform your business. Remember, your mantra for 2021 is that there’s no going back; you can only go forward. And get ready to shape a brighter future for your guests and your business.
About the Author
Tim Peter helps companies put the web to work to grow their business. He has worked since 1995 developing innovative e-commerce and internet marketing programs across multiple industries. Prior to launching Tim Peter & Associates, a full-service e-commerce and internet marketing consulting firm, he worked with the world’s largest hotel franchisor and the world’s premier independent luxury hotel representation firm to help hotels and resorts across diverse segments achieve more than $2 billion in online revenue.