As I mentioned in Part One and Part Two of this article, there are many mixed messages floating around in the hospitality industry about how/what hoteliers need to do to become profitable in the “new normal” that we’re all facing. Unfortunately, things just got EVEN more confusing…
With the Delta Variant widespread in most U.S. states – and most of the world – the recovery phase of the COVID-19 pandemic is again changing, and hotels must update their operational strategies accordingly, to ensure their guests remain as safe as possible.
But to make sure that you’re taking the best, most effective steps forward, I decided to focus this third article in our MythBusters series solely on the impact that the Delta Variant has had on both travelers’ wants/needs and hotels’ operational processes.
MYTH #1: The ongoing spread of the Delta Variant will shut down travel once again.
It is doubtful we will go back to where we were a year ago because of one simple fact: Even with Delta spreading, there are still many people who are willing to travel while abiding by the new rules that are being put in place to flatten the curve. These dedicated travelers have a HUGE pent-up desire to travel and will continue to do so, no matter what Delta brings to the table.
One key demographic that is seeing an uptick, despite Delta, is the business travel demographic. This group is more likely to abide by new state- or country-specific guidelines to avoid getting sick and being forced to quarantine in a foreign country. In the coming months, I predict that we’ll see an ongoing increase in business travel, especially in the domestic U.S. market.
Here is some information that supports my prediction: “A recent survey projects US business travel in the fourth quarter of this year will reach 25%-35% of 2019 Q4 levels, a significant improvement from the 10%-15% levels in the second quarter of 2021,” although a return to pre-pandemic levels is not expected until 2023 or later. In addition, “research from business software company SAP found 96% of business travelers surveyed “willing to travel for business over the next 12 months”.”
MYTH #2: Hotel industry workers are just sitting around, waiting, for their hotels to reopen so they can get back to work ASAP.
This myth is so far from the truth, it belongs up in space, along with Jeff Bezos and his rocket ship!
The fact is, hotels are struggling to find staff right now, especially in the U.S. market, where the travel recovery is already well-underway in most states. This is particularly true with housekeeping staff, and other minimum-wage staff, meaning that – even if travel tanks again because of Delta – it’s important for hoteliers to prioritize keeping their current staff onboard and making sure they are happy. If you don’t, it is guaranteed there is another hotel that will try to poach your employee, right from under your nose, to fill the staff shortages their facing at their property.
Your hotel should develop a plan today for both the best- and worst-case scenarios (related to the ongoing spread of Delta and the spike in cases throughout the country), that focuses on how to retain your staff. It should absolutely include a foundation of pay transparency.
With hotels poaching employees, it’s important that your pay structure be very transparent and focus heavily on showing employees the employment benefits you offer (vs. the competition). By making it clear how much you will pay employees, and what will happen if hotels are shut down again due to Delta, you’ll gain a great deal of goodwill with staff and reduce the likelihood that they will “jump ship.”
Finally, remember the very popular slogan: “Make love, not war,” as it is a phrase that hoteliers should be repeating to themselves daily. Our industry has been in crisis for 18+ months now and, during the pandemic, hotels and the industries that support them (i.e., operational technology), really started to show support for another, as much as they possibly could – because the threat was universal and we were all scared of what was to come.
Although the last few months of the Hot Vax Summer may have made you think otherwise, the threat facing our industry is still present for all hotels, worldwide, today (albeit, less so – see Myth #1). As an industry, we need to stop thinking and acting selfishly and, instead, help support each other as much as possible – or at the very least, stop stealing each other’s staff!
Here’s why… we are all going to need to work harder, together, to get travel restarted, especially as the Delta Variant continues to ravage the world. We can’t look at travel recovery on a country-by-country basis, as international travel will continue to be an important source of income for all hotels in the U.S.. Eventually, the thrill of domestic revenge travel will wear off, and hotels will be struggling to attract business once again if the international borders do not remain open; that’s why working together, as an industry, should be the most important priority for all hotels in today’s volatile hospitality marketplace.
MYTH #3: The fastest way to reach recovery is to use your 2019 business plan.
Nothing – I repeat, NOTHING – is the same about the travel industry today, as it was in 2019; travelers’ needs and wants, booking patterns, operational technologies, and revenue management and marketing strategies have all changed drastically from 2019 standards, so your operational strategies MUST as well… Full stop!
Now is the time for your hotel to regroup and rethink your marketing strategy; your hotel must also reallocate your marketing budget to prioritize feeder markets that have the highest demand for travel to your destination. Rather than casting a wide net or trying to be everything to every type of traveler, reconsider what key differentiators your property has to offer, and pivot, pivot, pivot to target those customers who want exactly what your property has to offer.
In conclusion, all hotels, no matter where they are in the world, should consider 2021 – and the years that follow – a whole new world for the travel industry. Like Aladdin said in the Disney movie of the same name:
“A whole new world (don't you dare close your eyes),
A hundred thousand things to see (hold your breath, it gets better).
I'm like a shooting star, I've come so far,
I can't go back to where I used to be.
A whole new world, (every turn a surprise),
With new horizons to pursue (every moment gets better).
I'll chase them anywhere,
There's time to spare,
Let me share this whole new world with you.”
Now, get to work; 2021 and financial recovery, awaits!