By Larry Mogelonsky, Adam Mogelonsky
The aging out of the baby boomers is a slow burn over the next two decades, but one that will inevitably burn down the house that comprises our current economic system. We’re already witnessing this silent hand in the form of long-term inflation stemming from boomer-led demand and we will see it start to crop up more often in the form of the “Great Wealth Transfer” as boomers start to die off (sad but true), leaving their hoards of riches to their Gen Y+Z heirs who may have widely different financial goals.
That may all sound a bit morbid. But what does this macroeconomic and decades-in-the-making trend have to do with hotels? In a word: wellness.
Here you have the present-day richest cohort of consumers – with 77 million of them in the United States alone – at the peak of their individual wealth who are retiring or contemplating this move while also possibly suffering from chronic health issues related to aging. This alone will mean hemorrhaging demand-side medical costs, but simultaneous to this trend is the domain of longevity science and the burgeoning mainstream narrative to support its findings that with the right form of bodily ‘maintenance’ we mere mortals can stave off a trip to hospital for many more years.
In sum, you have an extremely large and wealthy group of potential hotel guests who are increasingly ready and willing to pay for products and experiences that allow them to prolong their ‘healthspans’ – that is, the good years where they aren’t enfeebled and can enjoy the fruits of the world.
Change Will Come
While there is a lot of attention right now on attracting the next generation of travelers, the two of us rebut this by saying, “Follow the money.” And yet, this strategy is often at odds with growing wellness revenues because the awareness for wellness and healthier lifestyles is largely happening amongst the younger generations who are not, dare we say it, ‘set in their ways’.
Not to stereotype too hard, but it is much harder to convince an older traveler with firmly cemented habits to be swayed by a wellness program so that they select your brand over the competition or are willing to pad their hotel stay with wellness-oriented activities. Speaking from personal experience amongst the two of us authors, we have Adam (millennial) who spent five year convincing Larry (boomer) to stop putting milk in his coffee (for your information, non-organic, hydrogenated, pasteurized milk can be very inflammatory and not all that good for your bones, which itself was only really confirmed by earlier studies funded by the dairy companies who clearly had skin in the game) and to get off of the dogma of ‘three square meals’ in favor of an 8:16 intermittent fasting regimen (again, the whole three meals per day as healthy has now been wholly debunked).
Right now, the numbers may suggest that guests are only coming to your hotel for leisure or business or as part of a group, and not much else. Have faith; the convergence of aging populations and the continued gains of longevity science will lead to more demand for wellness programming, with the wealthy boomers leading the way in making longevity practices a booming business for hotels.
Wellness Primary Versus Secondary
Great; we’ve covered the slow burn of generational shifts. What can your hotel do about it over the next two years? To start, you need to understand the difference between ‘wellness primary’ and ‘wellness secondary’ guests. The former are those that travel specifically to a destination for some form of medical tourism or transformative experience. The latter are traveling for other purposes but nevertheless want to stay healthy as they go. This distinction is critical insofar as choosing which wellness direction to pursue.
Concurrently, this big trend all comes back to the data. If your systems aren’t connected to deliver rich guest profiles (whether within the PMS or pushed into a CRM), you won’t know what your customers really want, be it wellness-primary experience, wellness-secondary ones or otherwise. Moreover, you need data integrations to test whether small, incremental changes to your operations are having a meaningful effect on gross revenues. Third, if your teams are too busy handling the minutia of your existing operations, they won’t have time to learn new SOPs so that you can develop a full-fledged wellness program.
Overall, you need your existing teams to be as productive as possible and fully empowered through automation technologies. Simultaneously, you can develop a roadmap for implementing a wellness program that is already fitted to what you know about what your customers want and what your budgets can allow. Above all, and as we’ve made clear from the demographic argument, wellness is coming, with a lot of money to be made, so best be ready.