Four Underserved Growth Levers Hoteliers Need to Pull. NOW.
The word “pandemic” doesn’t generally conjure up many positive associations. Travel came to a grinding halt. Extra toilet paper was akin to bars of gold. Shelves emptied, stores closed, and life as we knew it was put on an almost deafening pause.
Fortunately, for the optimists, there was a silver lining. Businesses started innovating to meet the evolving dynamic, customers were met with more convenience, and added safety measures were put into place.
For hotels and resorts, who had been licking the wounds from a drought of empty rooms, many have neglected to see this glistening era emerge as they exit the dark and dismal 2020 tunnel and travel returns to normal. It’s their personal “Golden Hour” disguised as opportunity knocking.
In a time where differentiation is demanded, customer needs are shifting, and competitive advantage is more relevant than ever, the fortuity to innovate is ample. For hotels and resorts specifically, there are four key sectors that are worth evaluating, as they are primed for exceptional revenue growth. While heads in beds is generally the primary focus for the industry, these often-overlooked ancillary profit centers can make a radical difference to the bottom dollar IF nurtured properly.
Weddings & Honeymoons:
Destination weddings are nothing new. However, the value of them has shown considerable increase. Post-pandemic, couples began seeking quality over quantity. That means, more time with fewer guests and greater spend per guest. In fact, as of 2021, the destination wedding market witnessed a 28.7% surge in popularity. And it makes sense. For those looking to have more quality time with their loved ones than a few short hours can provide and so many craving a more experiential event, this offers the best of both worlds.
However, where many previous couples chose a destination “I do” specifically for the simplicity factor, today’s brides and grooms demand something different. Something authentic. Something that feels tailored to them, without the wedding factory approach. They’re seeking something unusual. Exotic even. They want an adventure their guests will never forget. And the kinds of photos that will make everyone NOT in attendance wish that they were!
Environmental Sustainability:
Going green is on-trend. And rightfully so. Over the last several years, more people and companies have taken responsibility for doing their part to save our planet. Where it concerns the carbon footprint left by large hotel and resort chains, quite a few are embracing a more sustainable approach. But very few are bragging about it, to the detriment of their bottom line. Considering that roughly 85% of consumers report a willingness to pay more for an eco-option, with 52% purposefully seeking out such preferences, not only are they missing an opportunity to build brand loyalty, but they’re leaving money on the table too.
Doing environmental good can reap great revenue rewards, and has the ability to add to the bottom line through cost reduction as well. For instance, offering reusable water bottles on property not only saves an embarrassing amount on plastic consumption, offering this keepsake also inadvertently creates marketing collateral that keeps your brand top of mind for their guests and an awareness tool for anyone that sees them using it. Win-win for everyone. And a simple one at that.
MICE:
Sure, many people have embraced the office exchange for more remote possibilities. And with the increase in virtual networking, many companies rarely get face-to-face interaction with their colleagues. Which is why we’re seeing a boom in meetings and conferences. Now, since they’re not together day to day, there’s a push to have annual or semi-annual meetings. And the money they save on overhead office space can now be reallocated to destination gatherings. However, with ample properties vying for the same groups, it’s more critical than ever to create a MICE product that stands a cut above.
Las Vegas, Dubai, New York, and Barcelona are making the most strides to innovate their offering. Perhaps the most pertinent question you should be able to answer is “Why us?” What are you doing to set yourself apart? How are you going above and beyond to delight your attendees? And how will you market it in a way they will recognize and appreciate? There are vast opportunities to differentiate this often-antiquated sector, from small shifts to grandiose innovations. You just need to understand which ones will create the least barrier to entry.
Health & Wellness:
If the pandemic proved anything, it’s that our health is our wealth. Which might explain why wellness tourism is skyrocketing faster than the current inflation rate. In fact, the global wellness industry at large is currently outperforming pharmaceuticals with a worth of $3.7 trillion. Not to mention tourists are booking 691 million wellness trips annually, again with a willingness to pay more for added well-being factors included in their stay.
This translates to radical revenue potential and differentiation opportunities for those properties who choose to leverage this upward trend towards better health. Even hotels without a direct focus on this area can create substantial ROI with the right investment. Even a minimal one. And of course, some clever marketing campaigns. This may mean reimagining everything from food to activities to the spa. Simply put, ample areas provide ample opportunity.
In short, changing customer dynamics can be both a blessing and a curse, depending on how you choose to look at it. From my point of view, this new normal is the perfect opportunity to turn over a new leaf. To innovate. Recreate. To dust off the cobwebs when it comes to programs and products that were surviving, but not thriving. Your guests, your hotel, and your profit margins will all be better off for it.
The time to pivot, however, is now. After all, we really have no idea when the next tide will turn.