World Panel
Viewpoint 4 April 2020

A Post-Crisis Top-3 Digital Marketing Action Plan

Digital Marketing in Hospitality

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A Post-Crisis Top-3 Digital Marketing Action Plan
This viewpoint was created by
Max Starkov, Adjunct Professor NYU Tisch Center for Hospitality and Hospitality & Online Travel Tech Consultant
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Mark Fancourt
Co-Founder at TRAVHOTECH

These are unprecedented times. Many have cited earlier events such as SARS, the global financial crisis and the Asian financial crisis. I was active in industry and in location through all of these. NONE of these remotely resemble the nature of COVID19. Even combined they are dwarfed by this situation. COVID19 is truly global. It is industry halting. It is not specific to any industry. It is cutting across the entire spectrum of society and business. Travel in any meaningful way has ceased to exist. The food and beverage and lifestyle industry have been cut off at the knees. First in, last out is a term I often use to describe the circumstances of hospitality.

As an industry and to some degree, as a planet, we have to 'learn to walk' again. The real challenge is that revenue has dried up for almost all but the most fundamental industries. As such expenditure also needs to dry up. if not more so to attempt to compensate.

When we emerge from this crisis we will have to rebuild the world's confidence and ability to travel in an environment where discretionary income has evaporated. Until revenue flows build in all other businesses we can expect to see slow growth in discretionary spend on travel. Sales and business opportunity-driven, yes. Other reasons, no.

In such an environment what can we do to catalyze travel? It's a tough question and I don't know that I have the answers. Although I have a few musings;

  1. I believe that the industry will have to ease business back into travel. I believe this will have to be done through bracketed recovery pricing that both incentivizes business to travel without what had been pre-crisis cost models. This will be necessary to get some revenue back into the travel sector so that services can begin and staffing can start to be restored. We also need to recognize that in the same way we have learned to better run our industry away from the office, the customer base we rely on has done exactly the same thing. They have been forced to learn that you don't always need to be there to get things done.
  2. I have questioned whether this might be an opportunity to look at some type of a subscription model for travel in the hotel sector where a business could lock in a fixed cost model for travel providing a level of confidence, but more importantly, exposure. Particularly dependent upon the roll-on effect of the virus in its further stages. This idea requires far more thought and research, but it could be an interesting time in a fresh start environment to experiment with such a model.
  3. If memory serves me correctly, from past economic and health impacts on our industry, when demand softens we also have to soften our expectations with it. This is the law of supply and demand and in the same way that we speak to the value of revenue management in good times, it also needs to serve us and the (very important) customer in the tough times. Hedging rate expectations in a market that does not have the funds or the confidence to travel will only result in lengthening the impact before returning to pre-crisis levels of demand.

I'm optimistic. I'm also a traveler and been around long enough to experience the ebbs and flows. Stemming from these beliefs I expect to see our business return to solid levels of demand and eventually back to growth. The pre-virus macro indicators for our industry have not changed.  

Although, like all other industries we will have to play a large part in creating that environment. Like us, the world and our customers are hurting. As an industry, we are asking the world to remember the damage done to us and requesting funds to see us through the crisis. 

As hoteliers, we will need to remember our customers have also suffered as they return to our market and support our industry recovery. Potentially having previously provided taxpayer funds for our survival.

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