More than ever, consumers are getting information from a variety of channels and making decisions based on an increasingly nonlinear discovery and decision-making process that may never include a brand’s owned channels. These facts are true across industries and are why many brands are diversifying customer touch points beyond traditional channels and into new outlets and partnerships.
The hospitality industry has borne the brunt of this shift in recent years with the rise of review and aggregator sites, and the emergence of online home sharing and home-stay platforms. While longstanding hotel institutions like Marriott, Hilton, Wyndham, Starwood and Hyatt are still garnering more revenue than homesharing counterparts suggesting continued consumer interest in hotel stays, new research indicates that in the coming year, consumers are actually less likely to book a hotel over an Airbnb or other homeshare service.
Millennials, who are reported to use homeshare services more than their older counterparts, are on track to become the dominant consumer demographic by next year. This means that going forward, millennial preferences for online booking and seamless online/offline experiences will need to become hotel priorities. Above all, millennials are looking for increased value for their spend, news that the industry doesn’t seem to be hearing as the average room rate continues to climb without a marked increase in guest experience across the board.
If hotels are going to continue remaining competitive amid the change, they’ll need to become increasingly attuned to the experience consumers are looking for from services like Airbnb, HomeAway, and VRBO: for example, a taste of the local culture, one-of-a-kind environment, and better value. But there’s a balance to be struck between delivering a very unique experience and offering an accessible cost if hotels want to remain relevant now and in the future.
While initiating widespread innovation for an improved customer experience is a valiant strategic goal, hotel marketers can also benefit from focusing on manageable, achievable short-term ideas for staying in the consideration set and competitive in the short-term.