Hoteliers And Passionate Travelers Suggest A Rebound Is Near
Examining the global luxury travel market during the recession
In April 2009, The Leading Hotels of the World, Ltd. engaged Market Metrix to conduct two surveys to gauge the views and behaviors of its hoteliers and consumers during the current economic downturn. The resulting white paper, authored by Market Metrix co-founder and vice president of research, Dr. Jonathan Barsky, provides interesting insights from around the world and draws five, significant conclusions that help us understand the marketplace and the industry's future.
While the recession has caused serious problems for many hotels across the board, the responses of more than 2,000 Leading Hotel guests from 95 countries, as well as 211 general managers, suggest that a strong rebound may not be farfetched. According to the study, more than half of the respondents indicate that the global economic situation has had no impact on their intent to travel in 2009. Furthermore, 90 percent of guests say that "leisure travel is of the utmost importance to them, and they may delay or cancel other leisure activities before canceling or delaying travel in 2009." With a mere 9 percent of general managers citing rate reductions as the strategy they are likely to implement to attract business, it is evident that a positive supply and demand situation is being recognized and forecasted from the hoteliers perspective as well.
Dr. Barsky's five profound conclusions, expanded further, are as follows:
Many luxury consumers intend to travel through the recession
Fifty-six percent indicate that the recession has not had an impact on their travel plans. For a small percentage (15 percent), the current state of the economy may be an incentive to travel more. Conversely, the majority of business travelers surveyed said their company has changed travel policies to reduce travel expenditure and to avoid any hint of extravagance.
All geographies are not created equal
Travelers from many countries in Europe (e.g., Spain, Germany, Sweden, Switzerland, Austria, and the Netherlands) seem to be less affected and report fewer modifications to their travel patterns than travelers from America, Canada, the Middle East, and Africa. This may be attributed to the social safety net in many European countries.
Use of the Internet is growing fastest among luxury hotel guests
Nearly 8 of 10 respondents said they have read user-generated reviews online, and one in three has posted a review. As a result, more managers are focusing on the guest experience and engaging customers during their stays. Additionally, luxury hotel guests have shown the largest increase in Internet bookings over the past two years.
The luxury guest is changing
Luxury travelers are demanding less pampering, more entertainment. The current economic climate is shifting the mood and type of experience travelers are seeking. Intercultural pursuits and opportunities for personal growth, such as shopping at village green markets, practicing foreign language skills, and receiving a local gift at turn-down, now surpass the desire to be pampered.
Hotels are protecting the guest experience and ADR
With staff failures having the biggest negative impact on guest loyalty, hotels are being careful to not make hasty staff reductions. In unavoidable situations, managers will likely displace back-office employees or restaurant staff before cutting front-of-house, guest-facing staff.
Comments
Pretty spot on and insightful analysis of the luxury travel market trend. Things seem to be looking up for the industry, I guess this was brought about by contingency plans initiated by hotels, the transport business and also the optimism of the consumers. Perhaps people were able to recognize the fact that there is no need to stop traveling, only the need to make wiser tour and travel packages and alternatives.
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