Due to swift vaccination, the US has all but fully reopened for business. Hotel bookings in the US in April 2021 have exceeded 2019 values. Meanwhile, destinations across Europe are gradually phasing through their respective roadmaps to reopen local economies, and the industry is growing increasingly optimistic in anticipation of the pent-up consumer demand.
Thus, our May 2021 Hotelier PULSE Report reveals growing optimism across the industry. Following a steady decline in hotels open for business since October 2020, our April 2021 survey results mark the inflection point with a significant increase in hotels that have reopened in anticipation of the summer demand. Over 75% of Hoteliers surveyed state that their hotel is open or will open in May and industry average monthly occupancy expectations are increasing for all market segments.
This edition also shows that Hoteliers want to capitalize on the demand that’s coming. For the first time since the start of the survey, expectations are that ADR may moderately increase, and two-thirds of hoteliers expect 2021 to be a better year than 2020 in terms of hotel revenue.
Another positive sign is that not only is leisure driving the recovery, but there is a growing expectation that corporate travel will resume. GDS data shows a small, but steady recovery and group demand is returning focused on Q4’2021 and Q2’2022.
Based on the current signals in the market, we expect the pent-up travel boom from the US to come to Europe. What is still unknown is when that time will come, as it continues to depend on how the pandemic and vaccination will evolve. Therefore, it is crucial for Hoteliers to continue sharing information and coordinate to ensure the industry can effectively capture the demand in the upturn.
Maintaining Competitiveness and Reclaiming Distribution for the Upturn
We are still navigating through a period where anything can change at any time. Therefore, it is essential for all hotels (and indeed all hospitality and tourism sectors/businesses) to keep an open line of communication and coordinate efforts. However, businesses will also have to uphold competitiveness in order to capitalize on the demand.
Given the industry's growing expectation for 'Revenge Travel' on the horizon, hotels need to be alert and flexible about how they interact with guests, as well as manage current costs and future revenue. Those who lower prices now to stimulate demand risk placing themselves at a competitive disadvantage. Remember, the demand is here, and the floodgates will open as travel restrictions continue to ease. Therefore, it is crucial to focus on delivering added value that meets the needs of guests, rather than lowering prices and losing out on business when restrictions are no longer a barrier to consumer demand.
If there is one important lesson the industry can learn from the economic fallout of Covid-19, it is the importance of reclaiming control of sales, distribution, and revenue. Throughout our Hotelier PULSE Report series, the Direct Channel has proven to be the most resilient. Our latest research shows that is also recovering faster in 2021. According to our Hotel CRS, Direct Bookings in April 2021 grew to over 78% of those in April 2019, outperforming major OTAs, including Booking (just over 49% of 2019 levels). This says a lot about guest behavior in the current climate. Consumers are engaging with businesses they can trust to flexibly meet their needs and deliver the best value.
It's promising to see that the majority of Hoteliers surveyed in throughout our Hotelier PULSE series continue to prioritize the Hotel Website' and other direct channels as crucial avenues to engage guests and drive direct bookings growth. It indicates the industry is thinking carefully about all stages of the guest journey from online search to check-out, particularly now that more guests are reaching out to hotels directly for trustworthy information and flexibility around their needs.
Indeed, the downturn gave Hoteliers the time to take stock of distribution and optimize direct channels to meet the needs of guests. When the world reopens, we will soon see which hotels used the time wisely to strengthen distribution and those that did not.
Whether it’s holding the line on price or engaging directly with guests in preparation for when destinations reopen, hotels must act now to strengthen their position and effectively capture the pent-up demand.
But with the global travel climate still so uncertain, it is still critical that the industry continues to share information and coordinate efforts for a stronger recovery. Hotels need to be agile enough to react quickly to unpredictable market changes and capitalize on the upturn. The more hotels know about the industry's roadmap to recovery and guest behaviour in the current climate, the stronger hotels will be in the upturn.
Hoteliers who would like to stay informed of the latest market data and crucial industry sentiments are invited to take our May 2021 Survey here.
About the Hotelier PULSE Report
Since the launch of The Hotelier PULSE Report series in April 2020, Guestcentric has surveyed thousands of Hoteliers on key issues that remain top-of-mind since the start of the Covid-19 crisis, such as occupancy, ADR, financial recovery, Health & Safety, and redefining Sales & Marketing strategies for the future.
For the 14th Edition of The Hotelier PULSE Report, we surveyed 89 key decision-makers at hotels. Group CEOs/ Property Managers represent the majority of our respondents at 32.6%, followed by General Managers at 31.5%. The remaining respondents include Front Office Managers (18.0%), followed by Revenue Managers/e-Commerce Managers (10.1%), Marketing Directors & Managers (3.4%), and Sales Managers and IT Managers (each at 2.3%). The overwhelming majority of our respondents come from Europe (85.4%); followed by North America (9.0%), South America and Africa (each 2.3%), and Asia (1.1%). Most of our respondents are from ‘City Center Hotels, at 48.3%, followed by Resorts (32.6%), and Bed & Breakfasts (19.1%).
GuestCentric is a leading provider of cloud-based digital marketing software and services that help extraordinary hoteliers promote their brand, drive direct bookings and connect with customers on all digital platforms. GuestCentric's all-in-one platform provides hotels with the only unified solution for managing their guests' online journey: award-winning, high impact websites; an integrated, easy-to-use booking engine; social media marketing and publishing tools; a GDS chain code and a channel manager to offer rooms on Amadeus, Booking.com, Expedia, Galileo, Google, Sabre, TripAdvisor and hundreds of other channels. GuestCentric is a proud provider of solutions that maximize direct bookings to hotel groups and independent hotels from collections such as Design Hotels, Great Hotels of the World, Leading Hotels of the World, Relais & Chateaux, Small Luxury Hotels and Small Danish Hotels. GuestCentric is featured on Skift Travel Tech 250, a list of the top 250 travel tech companies shaping the modern-day travel experience.