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Major
global study into the future of the hotel industry
A gaze into the future of what travellers’ hotel experience will be like in 2020 Understanding your customers is a strategic imperative for hotels in an era of unprecedented change. This means going beyond segmented groups to understand their full service spectrum of preferences and demands. Brands that don’t act on this may fall behind the competition permanently. Jérôme Destors, Director, Hotel IT, Amadeus November 2010 - A major new report, Hotels 2020: Beyond Segmentation, reveals the emerging behaviours and demands of the future hotel guest and what this means for the types of hotels we will see in the future. The study commissioned by the chosen technology partner and transaction processor for the global travel and tourism industry, Amadeus and carried out by Fast Future Research reveals that the industry faces three major impacts in the next decade which it has to respond to:
As well as looking to a future where increased choice, control and comfort are commonplace, the report acknowledges that the industry must respond to the demographic and economic changes in their guests circumstances. With an ever aging population globally, hotel groups must consider layout, access issues and facilities to cater to the requirements of older holidaymakers. Additionally, it is predicted that there will be an increase in multi generational holidays, which will bring with herald its own set of requirements. In addition to this, the report may have some good news for 2020’s business travellers. While currently hotels charge high rates for internet access, far from viewing it as a revenue stream, hotels may well be offering free wifi as standard in order to attract guests.
Background and methodology The study outlines the trends shaping the future of hotels, specifically in relation to the increased demands of customers and their personalized service spectrums. It covers:
Key findings and insights The move away from segmentation and towards a ‘total service’ model raises some key insights about the characteristics, nature and capabilities of the successful global hotel brand of the future. They include: 1. An organization capable of surviving and thriving in turbulence and uncertainty The path of the economy and hotel market over the next ten years is uncertain. We have to prepare for a range of possible future scenarios. This implies development of leaders, managers and staff who are curious, tolerant of uncertainty, capable of scenario thinking and willing to make decisions with imperfect information. 2. A portfolio of strategies for an evolving marketplace In response to differing rates of growth and development, hotel groups will increasingly adopt a portfolio approach to strategy with a range of different goals and approaches being pursued in parallel in different geographies and market tiers. An increased use of co-branding with well known consumer businesses is expected, along with the emergence of unbranded hotel groups providing ‘white-label’ services to hotel owners. Greater experimentation with business models is expected – with a proliferation of auction based models, low cost airline style pricing and a growth of 24 hour rental models replacing the fixed night option. 3. Deep understanding of a more geographically, financially, generationally and attitudinally diverse and rapidly evolving customer base There is a clear expectation of a growth in tourism from the emerging markets although it’s by no means clear how profitable that business will be. At the same time the fallout from the financial crisis could see an even broader spectrum of customers and diverse needs from established markets. Traditional segmentation models will no longer suffice as we try to capture the needs and nature of tomorrow’s traveler. 4. Delivering a personalized experience through a wide spectrum of service choice Customers will increasingly demand choice over every aspect of their hotel stay – encompassing check-in and departure, service levels, the size of the room, decor, the furniture in it, the audio-visual facilities, amenities and food and beverage options. 5. Immersive, tactile and multi-dimensional technology interfaces Generation Y and those that follow them are coming into the hotel as both guests and employees with a very different relationship to the technology they use. For them the boundaries between the physical and virtual world have blurred and the range of ways in which they’ll interact with their data will be far more visible and tactile than anything we’ve experienced to date. 6. Open, listening, collaborative and experimental approach to innovation Hotels will increasingly adopt best practices from other parts of the business world and start to integrate the customer and other business partners into their innovation processes by using techniques such as open innovation and crowd-sourcing. 7. Continuous search for ancillary revenue streams A range of approaches will be considered to increase revenue generation including discount offers to capture a share of pre- and post-trip travel spend, introduction to the hotel’s own branded goods catalogue and extension of the range of business services provided. 8. Connected, adaptive and predictive Tomorrow’s hotel will be far more embedded in the internet, playing an active role in social media and using it as a radar for changes on the horizon. Internally, a greater emphasis will be placed on flexibility to respond rapidly to a changing environment. New advanced analytical techniques and software tools will be adopted to help anticipate future patterns of demand. 9. Asset light, insight rich With a focus on becoming lean, flexible and responsive, hotel groups will continue to shed their fixed assets and develop innovative financing models for hotel investors. Analysts will increasingly start to value groups on the depth and quality of their market insight and their understanding of emerging drivers of change. 10. Continuous evolution – the hotel as a living laboratory Hotel groups will increasingly view themselves as being in a constant state of experimentation – with the individual properties as living laboratories for the development and testing of new ideas. Every customer interaction could be viewed as a potential source of feedback, new ideas and competitor insight.  About Amadeus Amadeus is a leading transaction processor and provider of advanced technology solutions for the global travel and tourism industry. Customer groups include travel providers (e.g. airlines, hotels, rail, ferries, etc.), travel sellers (travel agencies and websites), and travel buyers (corporations and individual travellers). The group operates a transaction-based business model and processed more than 670 million billable travel transactions in 2009. Amadeus has central sites in Madrid (corporate headquarters and marketing), Nice (development) and Erding (Operations – data processing centre) and regional offices in Miami, Buenos Aires, Bangkok and Dubai. At a market level, Amadeus maintains customer operations through 72 local Amadeus Commercial Organisations covering 195 countries. Amadeus is listed on the Madrid, Barcelona, Bilbao and Valencia stock exchanges and trades under the symbol “AMS.MC”. For the year ended 31 December 2009, the company reported revenues of EUR 2,461 million and EBITDA of EUR 894 million. The Amadeus group employs over 10,100 employees worldwide, with 123 nationalities represented at the central offices. To find out more about Amadeus please go to www.amadeus.com. To visit the Amadeus Investor Relations centre please go to www.investors.amadeus.com. |