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As more and more countries around the world begin to announce steps to ease COVID-19 restrictions, the hospitality industry is preparing its strategy for reopening and re-emerging into a new era for hotels. Many changes need to be made to adapt to the ‘new normal’, and inevitably there will be plenty of challenges along the way.
As part of our recent series of Q&As with leading revenue experts across the globe, looking at how they are adapting in the wake of the pandemic, we spoke to Jutta Moore, Managing Director of Moore Hotel Consulting. London-based, Moore Hotel Consulting works with international luxury and lifestyle hotels in all areas of revenue management.
Q: In recent months, the hotel industry has changed dramatically. How are you planning to restore consumer confidence and build up demand?
A: At the moment our focus is on operational excellence. Our main concern is that we keep our customers and staff safe. One by one you will start to see general managers
introducing new Hygiene concepts & safety measures at their hotels. Plexiglass screens will be installed in areas such as reception and customers will be offered a choice of checking in at a kiosk with a touchscreen or at reception in a more traditional, yet socially distant way.
Another big focus is on the hotel restaurants and looking at how occupancy will level out. First of all, we need to understand levels of demand. But then we need to look at safe social distancing and how far apart the tables have to be and how many people we can safely fit in the available space.
Once we’ve got the message out there loud and clear that we have all these changes implemented, we can then slowly start to look at revenue management again. Previously, we may have had a focus on up-selling through different platforms, but I think in the future, it’s going to be much more about what kind of message we are conveying about keeping our guests and staff safe in order to really build confidence and drive demand back up.
I think overall the focus will very much be on domestic travel to begin with, because nobody knows how the aftershocks of the virus will pan out, and nobody wants to get stuck abroad when and if borders are suddenly closed.
Q: How does the COVID-19 pandemic compare to other crises in the past, such as the financial crash of 2008 or SARS? What strategies did you use then that might be applicable now?
I think the really big difference with this crisis is that the whole world and every industry has been affected.
Before, it was in pockets, in particular destinations. For example during the financial crash of 2008/2009, it was very much the financial centers that were affected by the slow down, whereas now it’s across the whole world. Travel restrictions in both destination and source markets are an important consideration.
The other difference is that we are likely to see a massive shift in market segmentation. For example, big hotels that hold a lot of conferences or weddings will have to rethink how to fill those spaces because large gatherings are not allowed, or even when the rules change, people may not feel comfortable being at a large conference with 1,500 others. Hotels will have to be creative and reinvent themselves for example with blended, hi-tech events, where a number of participants can be at the hotel and the others will be addressed through appropriate technology at home or in offices. As Hotels have a lot of space, many corporate meetings that might usually happen in board rooms, may need to be moved to larger hotel spaces, which is an opportunity for some hotels. Traditional group travel segments will also need to be replaced by different market segments.
Q: How are your hotel clients adapting to the new normal?
A: We’ve noticed that a lot of our clients are receiving more phone bookings than usual. Normally most people make electronic bookings, but now they seem to be using the phone a lot more. I think because they might feel more confident actually speaking to someone on the ground who is really listening to them. They like to be able to hear what’s happening in the hotel’s neighbourhood and how the hotel has been affected. And so to answer this demand, many of our clients have repurposed their teams. Although many employees are currently furloughed, whoever does happen to be in the hotel at the moment is really helping out wherever they are needed, including on the phones, and not just sticking to their usual, clearly-defined roles.
There is also a lot of effort within the sales teams at the moment trying to identify any market niches that might be interested in staying in the future and identifying new source markets - perhaps people that we might not have thought about before.
In terms of operational plans, what is really key from a financial point of view is working out region by region what the relevant government guidelines are with regards to, for example, maximum occupancy. Once we know what that is, we then have to work out how we can actually build up to that occupancy and how we can increase demand. From a revenue management point of view, once the demand is back out there we can then look at new messaging to sustain and boost confidence. Because like I said earlier, the key message at the moment is around safety rather than price.
Q: Finally, what are you seeing from a bookings perspective?
There’s going to be a massive shift in terms of longer term bookings as well conferences and group travel. So currently for 2021, there’s not much on the books at all. However, for the latter part of this year, you can clearly see a slight increase in certain countries. In the UK, for example, as soon as talk of easing the restrictions began, there was a very subtle pick up in the intent to travel. So, there is a little bit more on the books from mid-July onwards. I think the same can be said for countries like Germany and Switzerland, although the levels are a little higher because restrictions were lifted slightly earlier.
All in all, the name of the game is flexibility, sending the right message and focussing on domestic travel in order to get that little bit of demand on the books.
Hear more from Jutta in our One World, One Conversation, One Industry webinar, now available to watch On Demand. Click here to find out more.
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