Considering the unprecedented global travel disruption and performance declines we've endured; hoteliers finally have something to look forward to. The world has spent the last 18 months dreaming about travel, but not actually going anywhere. Increasing vaccination rates combined with relaxed travel restrictions are bringing travel back… with a vengeance. Most agree that the worst is behind us.

But so far, this pent-up demand or "revenge" travel is different. Driven almost entirely by domestic leisure demand, the patterns have changed. Some premium locations are already exceeding 2019 pre-COVID levels, while hotels just a few blocks away are still struggling. Hotels that targeted the corporate, international, or group segments are reinventing themselves, with mixed success.

Considering the unique nature of the recovery, what should hoteliers do to optimize and manage COVID's pent-up demand?

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Gino Engels
Gino Engels
Co-founder and Chief Customer Officer of Lighthouse (formerly OTA Insight)

The hoteliers who are able to make qualified commercial decisions around shifting demand, ahead of their competitors, will put themselves in the best position to capture pent up demand and capitalise on revenge travel in recovery. These decisions all hinge on having the best tech solutions in place that can deliver actionable insights based on the industry's most accurate and complete, real-time data.

Forward looking data

Traditionally, hoteliers relied on historical analysis such as identifying established demand drivers, year-over-year trends and on-the-books data to forecast and build a picture of incoming demand in their market. But with 2020's data, and a large portion of 2021's data rendered mostly irrelevant due to the impact of COVID-19, revenue managers have a problem on their hands when it comes to anticipating upticks in demand.

Speculatively forecasting demand based on the manual analysis of trends and the news is nothing more than guesswork (and highly time consuming for leaner teams). That isn't a sound enough strategy to effectively capture pent up demand in this recovery period. Instead, hoteliers should incorporate a predictive market intelligence solution into their tech stack, which utilises forward looking data points such as flight and hotel search to reveal the first signs of traveller intent for their market, and deliver location-specific, segmented demand insights. 

Hoteliers can examine source market demand data to understand which guests are willing to travel to their destination, from which country or airport, and when. Armed with insights on the booking window and length-of-stay, hoteliers can make more informed pricing and promotional decisions, and deliver targeted marketing campaigns focused on particular source countries and more precise dates. 

Agile decision making

The timeline to a full recovery across the globe is still clouded. With market restrictions changing in the blink of an eye, travel is recovering at different rates depending on the country. Although there is clearly pent-up demand, the market remains volatile - so hoteliers need to be more flexible than ever as they navigate recovery. Without the correct predictive intelligence solution, like OTA Insight's Market Insight, they won't be able to spot shifts in traveller demand from different source markets and take much needed revenue opportunities. 

Similarly, a solution of this kind is also able to judge the strength of domestic demand, so hoteliers can make suitable pricing, marketing and budgeting decisions for this segment. A segment that is expected to be a key source of demand, and therefore revenue for the foreseeable future.

Integrated tech stack

Fine tuning a dynamic pricing and marketing strategy has never been more important, particularly as less price-sensitive market segments, such as business travel are currently negligible. Employing an integrated tech stack at your hotel, including a high quality rate shopper and business intelligence tool to complement a predictive intelligence solution will create a comprehensive price, market and business intelligence suite. This can give you a much needed edge when it comes to capitalising on pent-up demand. Identifying and acting on demand trends before the competition could be the difference in maximising revenue in recovery.

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This World Panel Viewpoint is sponsored by Cendyn™
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