How Hotels Are Diversifying Their Offerings to Generate Revenue During COVID
Over the last year, with events and travel being halted, all sectors within the hospitality industry were challenged to reimagine their business models to keep their businesses sustainable. While there are positive signs for recovery ahead and increases in hotel bookings, the pandemic has changed consumer demands and expectations dramatically, making it integral for businesses to adapt their offerings accordingly.
Hotels, in particular, have had to rethink their traditional business models and have had to come up with creative ways to use their spaces. We’ve hotels begin using their rooms as coworking spaces, offering in-suite private dining packages as well as providing a variety of incentives in order to continue generating revenue throughout the pandemic. While these new revenue strategies were employed as a result of COVID, guests will continue to seek unique experiences hotels can offer that bear safety in mind.
Offering day-bookings for remote work
With remote work becoming the norm, and the likelihood of renewing office leases remaining low, many people are looking for a change of scenery, opening the doors for hotels to offer them a way to take the ‘home’ out of work from home and pivot to “work from hotel.”
From boutique hotels to large hotel chains, such as Hyatt Hotels & Resorts, this trend was seen as an opportunity to meet the demands of travellers and bring back some level of business to their hotels in the process. What was originally rolled out by Hyatt in response to COVID, has now become a mainstay offer for guests who are looking to escape the distractions of home — either for a single day or an extended stay. Offering this type of package is a great way to fill hotel rooms, resulting in revenue while also fulfilling the need of guests looking for new working quarters.
Capitalizing on large spaces for small meetings
There is certainly something to be said about meeting colleagues face-to-face, despite how accustomed we have all become to virtual meetings. While traditionally, businesses may have booked sizable meeting spaces for large conferences, hotels can now take advantage of these larger spaces as a way to meet in-person while still maintaining a safe distance.
Incentivizing extended stays
Due to quarantine restrictions after traveling, going to a new location for a longer-than-usual stay has been enticing for those looking to scratch their “travel itch” throughout the pandemic. With employees experiencing remote work (many for the first time), it has opened up an entire new world for those with the flexibility of uprooting and working from new locations for months at a time. Hotels can seize this opportunity and incentivize this group by offering discounts on extended stays.
Hotels across the country started offering deals, including Hotel Magdalena in Austin, offering 15 percent off if you book five nights or more. ARRIVE Hotels, which has locations in Austin, Wilmington, Palm Springs, Memphis, and Phoenix, offered guests anywhere from 10-15 percent off when they booked a stay for three, four, or more nights.
Reimagining private dining
Creating unique and memorable experiences for guests is a cornerstone to developing a steady stream of returning clientele. Using hotel rooms as private dining rooms is an excellent way to shape an unforgettable experience.
Now, you may think that private dining in a hotel room is just bringing in a table alongside the typical hotel bed, but we’ve seen hotels take this to the next level. Hewing Hotel in Minneapolis’ North Loop is an excellent example of how to execute this tactic. The hotel started off by removing beds from a small handful of rooms and setting up tables with beautiful decor. What started out as a trial-run with a few rooms quickly sold out the first weekend, proving there is a clear demand for unique and intimate experiences that can be executed in a way that makes guests feel safe. Since its original launch, the hotel now offers 14 private dining rooms, four nights per week.
Additionally, hotels that have a restaurant have worked with their staff to provide takeout meals for their guests or those in the local area who are interested in picking up a quick meal. Hotels have introduced grab-and-go markets, curbside pickup, meal kits, and partnerships with delivery apps to bring in some dining revenue.
Leading the charge forward
The hospitality industry is bouncing back. Every day, more people have received the COVID-19 vaccine and people are, in general, feeling optimistic about regaining their pre-pandemic lives. People are beginning to feel safer than they have felt for more than a year. With spring and summer events starting to be put on the calendar, hotels can begin preparing, if they haven’t already, to welcome guests back with open (six-foot distance) arms. Finding creative ways that both offer distinctive guest experiences, while also boosting revenue will be key for hotels to continue the path forward towards recovery.