Analysts across the travel and hospitality industries have questioned if corporate travel will ever be the same since the beginning of the COVID-19 pandemic. With an active summer travel season almost complete, a potential rise of in-person meetings might occur this autumn.
Cities like Las Vegas, Orlando, and Dallas are leading the return of corporate travel and group business. The possibility of face-to-face interaction is driving a rise of in-person meetings across the United States. The hotel industry can use the upcoming season as an opportunity to bring corporate travelers back into the fold.
Many hotels are understaffed due to a pervasive labor shortage limiting their abilities to provide great guest experiences as bookings increase. At the same time, hotels have been unable to push their rates while gas prices and other travel necessity prices rise. Operating margins might be slim for some hotels.
Hoteliers might remain cautiously optimistic that travel will return to sustainable levels given current market conditions. The best option available is to attempt to control the elements they can at their hotel and work around those they can’t. Having access to advanced data analytics is necessary to help hotel operators make split-second decisions about rate, room placement, and when to relaunch amenities or services.
Revenue management is growing more sophisticated as the economy recovers. As businesses reopen, hotels must account for the labor shortage and the possibility that local services may be inconsistent for an undetermined period of time. Depending on a property and its positioning in a market, this could both create new challenges or present new revenue opportunities.
Charting local economy recovery alongside national activity can be difficult without access to data analytics. Within a connected commercial organization where every department of the hotel is sharing information with others, hotels are able to optimize their group business yield at the right time, maximizing profits across all revenue streams when it matters.
Online and Offline
Many want to meet in person, but an equally large number of travelers remain attached to digital meetings for a variety of reasons. Some might be waiting for a larger percentage of U.S. travelers to become vaccinated, others might have grown accustomed to their digital workspaces, and more are delaying corporate expenses until the future is more clear. For, now, hybrid events are sticking around, and hoteliers need to account for them.
Hybrid events are a net positive for hotels because at least some segments of travelers are on-property, while another large group is willing to attend virtually. However, these events might cause uncertainty when it comes time to forecast the number of guests expected to arrive. Hybrid events require a different understanding of a hotel’s business mix, intertwined with economic recovery, vaccination rates, and telecommuting trends.
In the long term, hotels will benefit from hybrid developments. For now, operators need to do what they can to understand the shifts taking place at each destination. This is a complex undertaking, and it typifies the importance of revenue management technology and data analytics beyond the guestroom for areas like meetings and events and food and beverage. Without them, operators will be stuck guessing their potential revenue at a time when they are short on staff.
Before 2020, this technology was considered the best way to optimize rates, but today, it’s a necessity for survival. Time is also of the essence. Understanding the drivers at work behind data is as essential as gathering it. Tools exist to help visualize these findings in a way that operators can quickly act on, but they are only available to hotels willing to embrace innovation by uniting their internal systems. Once a hotel’s property management, revenue management, and guest reservations systems are united, operators will be able to adjust rates on the fly with intelligence and confidence.
The veil of uncertainty covering the hotel industry has not fully been lifted, but there are a number of reasons to remain optimistic. The return of leisure travel and a growing interest in corporate travel is giving operators options to grow their business. At the same time, a labor shortage and the rise in competition from properties coming back online is the vanguard in a new series of challenges for operators to overcome.
The future is unclear, but thanks to sophisticated technology, hotels can see a little bit more clearly. If operators can embrace the tools that allowed so many hotels to succeed during the pandemic, they will see its potential for overcoming these current challenges as well.