By Bob Palloni, COO and co-founder of Skyware Hospitality Solutions
Suppose I were to ask you to define a great guest experience today. In that case, your answer would – in all likelihood – differ substantially from the description of a great guest experience just a decade ago. The hospitality industry is no stranger to the tides of change; after all, ours is a market that exists to appeal to customer preferences. Humans are complex creatures with an equally complex, ever-changing set of values, needs, and preferences. But over the last decade, we’ve witnessed the rapid evolution and embrace of guest-facing technology, in addition to the guest-facilitated push for increased sustainability, more personalized experiences, a greater emphasis on unique hospitality offerings (from accommodations to F&B), an increased focus on cleanliness standards, and so much more.
In a survey conducted by Oracle Hospitality, 84% of respondents said they would like to see more visible cleaning in hotels. Moreover, according to a study by Expedia Group, 36% of respondents said they would pay more for a personalized experience. Similarly, a survey by Booking.com revealed that 70% of respondents said they would be more likely to book eco-friendly accommodations. In contrast, a survey by Skift revealed that 57% of respondents would be more likely to book with a hotel that offers flexible cancellation policies. We did, after all, just emerge on the other side of a global pandemic – an event which, in many ways, forever changed the world and our respective industries.
For hoteliers, though, rapidly changing guest preferences are, understandably, a point of concern and, at times, contention. Many hospitality brands today may feel their offering(s) simply can’t keep up with emerging guest demands. At the same time, though, Accenture reveals that 64% of consumers wish companies would respond faster to meet their changing needs. In comparison, 88% of executives think their customers are changing faster than their businesses can keep up. Will guest preferences always feel like a moving target that remains just out of range? To better understand this question, we must first consider what drives these rapid changes in guest preferences and travel behavior.
In the wake of unprecedented times, we are met with unpredictable markets. Right now, consumer prices have reached (or, in some cases, surpassed) their highest rates in 40 years, while the ongoing conflict in Ukraine and post-pandemic economic fallout continue to indicate potential long-term financial consequences at the consumer level. To this effect, Accenture reveals that 72% of consumers cite external factors, such as inflation, as having a more significant impact than in previous years. Similarly, Gartner research indicates that more than half of consumers feel like they have less disposable income and savings this year, and PWC reveals that 96% of surveyed consumers intend to adopt some type of cost-saving behavior over the next six months. Simply stated – consumer behavior is adjusting to adopt a more conservative, risk-averse approach in response to continued economic volatility.
Now, for the good news. Despite the influx of budgeting seen across other industries and spending categories, the appetite for travel is alive and well. In fact, the interest in travel (and willingness to spend on travel-related purchases) may be more heightened than ever before following the pandemic. Almost one-third (31%) of travelers said that they intend to spend more on travel this year than they did in 2022, according to a recent report from the World Travel and Tourism Council and booking site Trip.com. Julia Simpson, president and CEO of the WTTC, reiterated this observation at the opening of the ITB Berlin travel conference this month, noting that consumers are “spending more on travel than any other experience.”
This is great news for hospitality professionals, although it means guests will likely have bigger expectations of the ‘value’ they receive from their travel-related experiences. As the saying goes – with great power comes great responsibility.
Climate Anxiety and Social Responsibility
Almost 99% of more than 15,000 global early technology adopters consulted by Ericsson say that they expect to proactively use internet and connectivity-based solutions by 2030 to personally address the impact of climate change and global warming. According to the report, the main concerns include the cost of living, access to energy and material resources, and the need for safe and reliable connectivity in turbulent times and chaotic weather. Some 59% of respondents believe that innovation and technology will be crucial to address everyday challenges caused by climate change in the 2030s. Similarly, WEF research on solutions to the cost-of-living and climate crisis found 78% of our members calling for sustainable food production and 68% for energy.
When we look at the hospitality industry, we observe a similar trend of climate anxiety and, as a result, a widespread push for more sustainable, eco-conscious practices. According to a 2021 survey conducted by Booking.com, 82% of global travelers say they want to make sustainable choices when they travel, and 71% of them expect the travel industry to offer more sustainable travel options. Furthermore, a 2021 survey conducted by Hilton Worldwide found that 95% of their guests surveyed want to be more environmentally sustainable in their travels, and 78% say it’s important that hotels have environmental and social initiatives.
The sudden sense of social and environmental responsibility exhibited by travelers today should come as no surprise; after all, the hospitality industry is notorious for its substantial carbon footprint. The United Nations World Tourism Organization (UNWTO) estimates that the tourism industry accounts for about 5% of global greenhouse gas emissions. This includes emissions from transportation, accommodation, and other tourism-related activities. By adopting greener practices and prioritizing sustainability as an integral pillar of business, hotels can rest assured that they will positively influence the sector and better connect with increasingly eco-conscious guests.
The COVID-19 pandemic left many of us feeling lingering impermanence or “FOMO” (fear of missing out). After experiencing the disruption of so many conveniences, routines, and luxuries we once took for granted (such as travel), the appetite for experiences in the post-pandemic world is undeniable. In an environment of perpetual change, consumers and travelers are now clinging to the activities and experiences they value in a manner that reflects FOMO – “I have to experience this now, in case there comes a time when it’s not an option.”
This societal shift, in many ways, explains the travel industry’s resilience to economic fallout and, at the same time, the undeniable push for experience-based hospitality offerings. Now, more than ever, travelers are less preoccupied with material goods and, instead, are hungry for memorable, unique experiences that can’t easily be replicated at home. Guests aren’t simply looking for a bed to sleep in; rather, they are looking for more meaningful interactions and connections with the hospitality brands they purchase from and the local culture of the destinations they visit.
Even as we put the pandemic behind us, certain changes that were ushered in over the last 2-3 years demonstrated considerable staying power. At the top of that list, we find remote work. With countless companies having now adjusted comfortably to the WFH model that was initially prescribed as a short-term solution in the pandemic era, a hybrid work model is increasingly prevalent.
With this in mind, many hybrid and fully remote workers embrace their newfound freedom and flexible work environment by working abroad or blending work trips into leisure vacations.
A Digitally Driven World = Digitally Driven Expectations
Let’s face it – we live in an exceedingly digital world. In today’s day and age, to be tech adverse is to deny the many digital innovations that rule our day-to-day personal and professional experiences. The convenience and personalization we have become accustomed to can, more often than not, only be offered at scale with the help of tech-driven innovations and touchpoints.
To this effect, a 2021 survey by Expedia revealed that 54% of travelers globally prefer personalized experiences tailored to their interests and past behaviors. Similarly, a 2021 survey by Expedia found that 65% of travelers globally said they are excited about the prospect of using technology to enhance their travel experience, while a 2019 report by Skift found that 58% of U.S. travelers said they would be more likely to book with a travel brand that uses the latest technologies. As technology continues to become more omnipresent in our personal and professional lives across various mediums and markets, its influence on guest expectations and preferences will become impossible to ignore. Travelers increasingly value the convenience and efficiency that technology can provide when planning and experiencing travel.
To meet this demand, hotels must invest in technology.
Tech to Spark Growth and Increase Performance
Fortunately, technology makes it easier for hoteliers to streamline their operations and improve the guest experience. The preferences demonstrated by the modern guest are influenced by various factors, from economic events to changing marketplace standards, cultural shifts and generational nuances, social and political trends, and more. However, considering the factors influencing guest preferences in 2023 reveals an incredible opportunity for hospitality brands. After all, the appetite for travel and unique experiences is alive and well. Travelers are eager to support hospitality leaders in sustainability, and embracing new-age technology unlocks a new standard of guest connection, channel cohesion, convenience and personalization, and staff productivity.
It’s all there. With the right offering, the right people, and an all-in-one cloud-based technology, hotels have everything they need to meet and exceed guest expectations in 2023 and beyond.