The impact of changing consumer behavior –

Over the past two years, consumer behavior has changed dramatically. As demand returns to pre-pandemic levels, driven by growing consumer confidence, pent-up demand and accumulated savings, the way consumers spend has changed forever.

Contribution from Pierre Marechal, JLL Hotels & Hospitality Group, Singapore

This is impacting the hotel distribution space, and it is critical that all stakeholders understand and embrace the new reality.

Greater digital adoption is essential

Some 40 million new internet users went online in 2021. This brings internet penetration in Southeast Asia (SEA) to 75%. For reference, Europe was at 82.5% in 2019.

Groceries, home learning and entertainment have benefited massively from digital adoption. A McKinsey study found that online grocery shopping would likely maintain its pandemic increases, while remote learning, air travel, dining and live entertainment would likely return closer to pre-pandemic patterns.

Changes to food and beverage outlet operations due to constant closings and reopenings, as well as pandemic-caused seating restrictions, have forced deeper, long-term changes to the dining experience. restoration. The most nimble operators have adapted by adopting basic take-out options or creating in-home restaurant-type experiences. Some have gone further by moving to a full cloud kitchen concept.

These are great steps to reduce the proportion of income tied to their real estate, but more can be done: food and beverage operators can set up their own online store, offer private in-home catering around their signature dishes, curate a selection of wines. , and even offer online cooking tutorials.

The increase in time spent online has also redistributed audience profiles. Cloudflare’s Radar Project found that in 2021, TikTok was the most popular domain, overtaking traffic from Google or Facebook. While it’s important for marketers to embrace this growing platform, they also need to make sure they stay nimble and engage with their customers where they are, keeping in mind that their behavior is changing faster and faster.

Work from home and virtual meetings

Humans are social beings and two years of isolation is (very) long. There’s no doubt that more time (and money) will be spent away from home.

In a radio interview earlier this month, Accor CEO Sébastien Bazin predicted that the decline in activity among international travelers, as the adoption of Zoom and Teams soared over the past past 26 months, will be offset by domestic demand.

According to an internal Accor survey, while most employees do not want to return to the office five days a week, 70% do not want to work from home either.

Instead, Bazin expects them to work in hotel lobbies, bars or restaurants. He is betting that his hotels, mostly located in major cities, will be busy from 9 a.m. to 9 p.m. with local demand. Its hotels will compete with places like Starbucks that have met this particular demand for the past 10 years.

With this new audience, operators must strategize to best capture additional revenue opportunities such as valet parking, health club, concierge services, or laundry services.

If the preference for virtual meetings persists, hotels may need to consider whether their high-cost, but underutilized, meeting and event space is fully optimized. A trend worth considering is the establishment of private clubs in these prime spaces, as the city’s hotels have the locations, facilities and service personnel to operate them, and the demand for these venues has dramatically increased. increased in recent months.

From omnichannel to ubiquitous

The aftermath of 9/11 was a catalyst for leveraging e-commerce to maximize room night sales.

Post-pandemic recovery may have the same impact on the distribution of hotel goods and services and present an opportunity to move from omnichannel to ubiquitous. Resources will be needed to upgrade the tech stack.

Marriott took a step in this direction when it announced last November that it had signed an agreement with Amadeus to modernize its reservation and commerce infrastructure. As hotel stays are increasingly marketed as experiences, hotels that allow guests to purchase complimentary products like spa and golf when booking a stay will gain a competitive advantage.

The next phase of this project will also allow customers to purchase other items such as the desk lamp or lounge chair from their favorite hotels or resorts.

Integrating the booking and fulfillment process with partners such as ShopBack, a rapidly growing cash back program with multiple travel and hospitality offerings, will provide even greater market presence.

Addressing the digital future is imperative

A good distribution strategy can no longer be limited to selling rooms via a branded website, online travel agencies or the GDS. It is time to be creative, to look around and to commit the appropriate resources to transform and modernize practices.

Other industries have already done it, and the hotel industry should not be left out.

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