People cottoned on quite late in the day to the fact that we’re entering not just a new year, but a whole new decade.
And at times like this it’s especially interesting to look backwards, and make predictions forwards, about how much the world as well as the sector in which we operate are changing.
After all, a decade ago the business environment was in some ways quite different. Bizarrely, only a couple of years after the smoking ban was introduced in the UK, Marlboro was the 7th most valuable brand in the world. And Blackberry – remember them?! – was the 14th.
While some parts of the hospitality industry were very recognisable, others were very different. The biggest hotel brands were well-established – and in fact have hardly changed over that decade. In 2010, IHG was the largest, Wyndham second, then Marriott, Hilton and Accor. Today, Marriott heads the list following its merger with Starwood, while Hilton, Accor and Wyndham have been joined by Best Western – only mergers and acquisitions make anything much change in that list.
In contrast, closer to our own sector, Airbnb was in its infancy, basically operating as a way for people to find short-term accommodation in someone else’s spare room or on the couch.
Meanwhile, our own serviced apartment sector had only just started evolving. To pick two of our longest-serving Members as an example, in 2010 SACO offered 5,000 apartments, and now number 80,000 – plus their other brands they’ve evolved, such as Locke. And BridgeStreet had 1,200 apartments a decade back, and now operates in more than 23,000 cities in over 130 countries. To name but two success stories!
So at this time of year and indeed, of a new decade, I thought I’d dip my toe into a few predictions for the coming months and possibly even years. Please contact us with your own – and we can have a round-up of how we did in January next year and in 2030.
I see the inexorable rise of co-living as potentially having a massive impact on the housing market, the whole hospitality industry and our own serviced apartment sector, competing not only for physical real estate in some of the world’s busiest regions, but also for the guest.
Schemes I’ve seen in the US and London are starting to offer co-living with tenancies starting from two weeks, rather than months or years. So will Millennial and Gen Z business travellers on assignment start to join the millions worldwide looking for short-term residential accommodation which comes with a ready-made community and social life?
Who knows? One day we might move seamlessly from student halls of residence to a co-living development, and eventually into a retirement apartment complex!
The sharing economy
As Airbnb is likely to float this year, so it’s interesting to speculate about what happens next. Over the last decade it has spawned and then seen off most of its copycat competition and given rise to a generation of add-on services such as management companies and professional hosts.
The original team are still very much involved; but who knows what will happen after it goes public? My own prediction is that Airbnb itself as the best known homestay brand will remain a popular alternative accommodation option, and spread ever further globally; but that it will lose momentum as its unique offering becomes increasingly diluted by other options such as co-living and glostelling. The new generations of travellers will be less impressed by simply stepping into someone else’s life and will seek out other things Airbnb can’t always guarantee – such as a social life, real experiences, and cutting edge technology.
In-room and booking technology
As travellers become ever more demanding in their own lives of seamless technology, AI and automation, hospitality will have to continue staying one step ahead. The day may well come when a guest expects to open the curtains, turn on the shower and book an Uber before they’ve even left their bed, or they’ll not consider a brand is delivering.
I think hospitality brands and technology companies will need to collaborate on driving even more change in terms of construction, energy efficiency, connectivity and the entire booking process to keep guests truly engaged. It’s no longer about having a points-based loyalty scheme; it’s about making sure the guest stay is at least comparable to the traveller’s own home experience.
Sustainability and overtourism
We’ve been focusing on this as a theme this year, and as the end of the next decade is basically the drop-off point for climate change, I foresee more and more pressure from governments and cities for hospitality brands to conform to a set of measures to minimise further damage.
From banning plastics to planting trees, sustainability is going to become one of the biggest considerations when granting permission for development. Once it was housing – which co-living can help with – but now there’s no point attracting guests in if there’s no air to breathe when they get there!
In terms of trends for travel itself, some of the biggest airline, ferry and cruise companies are already developing alternative means of propulsion and transportation. And some of the most beautiful and iconic cities worldwide are already working hard on balancing limiting the physical damage caused by millions of visitors with the value they bring economically. Could we start to see cities of special historical importance start charging for entry, and limiting numbers? And will we see electric cruise ships? Possibly not. But if port cities start banning diesel in the way some landlocked ones are already doing, we will start to see the popularity of cruises drop away, especially as they have traditionally attracted older travellers on the whole, and those potential guests seeking something more sustainable for their trips.
We already see tourists seeking real experiences and pushing themselves further afield to try not just living in the apartment of someone else, but actually understanding the challenges and opportunities of their lives. I’m sure we’ve all seen massive groups of foreign visitors around the world with lanyards and flags following one another in gaggles looking at whatever they’re being told about and moving quickly to the next.
But especially as travellers get younger and better informed through social media and augmented reality, the need for them to engage on a more authentic level will grow, and the selfie will no longer be enough to prove you were somewhere. In future you’ll need to worked in the fields alongside people or have paddled your own canoe rather than sit back and take the pictures.
So that’s just a very few thoughts about where the hospitality industry might find itself heading. And as for our own sector? Who knows?
But as long as we continue to offer the travelling consumer a high-quality, professionally-managed, modern, responsive, technologically-aware, personal offering accompanied by top customer service at an accredited level, with them always at the front and centre of everything we do, things can only remain optimistic for the future. 2020 is going to be a great year for the Association and our Members, with lots of exciting things I’m going to be revealing over the next few weeks, from TV exposure to new routes to the corporate market.