Following the unprecedented events of 2020, Hoteliers are bracing for the long road to recovery in 2021.
NB: This is an article from GuestCentric
With our latest Hotelier PULSE Report revealing that the majority of Hoteliers only expect to financially recover to 2019 levels in 2022 or 2023, cost-saving measures will continue to be top of mind for the industry worldwide.
In addition, local tourism will continue to be crucial for Hotels’ recovery, with increasing numbers of Hoteliers now reshaping their marketing strategies around local markets in the coming year and beyond.
Subscribe to our weekly newsletter and stay up to date
In this article, I share what is expected to be the top 10 Hotel Trends to Watch in 2021.
10 Hotel Trends to Watch in 2021
2020 was a year unlike any other for the worldwide Hotel industry. And while the industry has been significantly impacted as a result, the downturn has also given Hoteliers the opportunity to rethink and reset their sales and marketing strategies for 2021. Below are the top 10 Hotel Trends to watch in 2021:
1. Hoteliers will Prioritize Saving Costs in 2021
According to our December 2020 edition of the Hotelier PULSE Report, nearly 57% of Hoteliers only expect to financially recover to 2019 levels in 2022. Furthermore, a growing percentage of Hoteliers (currently at 18%) only expect to financially recover to 2019 levels in 2023.
With this in mind, Hoteliers expect to implement more cost-effective sales and marketing strategies in 2021. More specifically, Hoteliers will increase focus on the direct channel, resulting in decreased commission payments to 3rd party distribution channels. When you consider that all other third party channels have been consistently underperforming since the start of the crisis, it’s easy to see why this is the case.
According to our December 2020 Market Trends research conducted in November 2020, Booking generated just over 50% of reservations over the same period in 2019. Expedia, on the other hand, generated just over 23%. The Direct Channel, however, generated nearly 60% in comparison.
Considering the current economic climate and ROI per channel, it’s certainly more cost-effective to generate a direct booking rather than pay commission fees to third parties.
2. Hotel Direct Sales Channels will Propel Recovery & Help Hoteliers Regain Control of Distribution
While all hotel sales channels plummeted with the pandemic to nearly 0% of 2019 levels, the direct channel has consistently outperformed all other third-party distribution outlets and is set to be the fastest sales channel for recovery.
In fact, our Market Trends research from Q4 of 2020 reveals that the direct channel generated nearly 70% of bookings in October 2020 compared to the same period in 2019, while direct bookings in November 2020 were positioned at nearly 60% of bookings over the same period in 2019. The impact is unsurprisingly reflected in stays too, with the direct channel generating nearly 72% of stays in October 2020 vs 2019, and nearly 57% of stays in November 2020 vs 2019.
Hoteliers are expected to continue focusing efforts toward strengthening the direct channel to reduce dependency on intermediaries. In fact, our December Edition of The Hotelier PULSE Report reveals that the majority of Hoteliers expect ‘Direct Bookings’ to increase in importance over the next 12 months.
Although the industry has recognized the need to regain control of distribution and reduce dependency on third-party sales channels, 2020 has sharpened the focus on strengthening the direct channel for the future.
