REDWOOD SHORES, CA—Although travel is beginning to resume, not all people feel comfortable taking long-distance or international trips. Many travelers instead are flocking to drive-to markets, including local and domestic leisure trips. In fact, according to research from Oracle Hospitality, almost 50% of travelers see themselves taking local trips within driving distance in the next six-to-12 months, outpacing the 26% who foresee international trips and 25% who anticipate taking business trips.
Hotel Business caught up with Tanya Pratt, VP, Opera Cloud Strategy and Product Management, Oracle Hospitality, about these findings and how they will affect technology going forward:
Can you summarize some of Oracle Hospitality’s findings regarding the rising popularity of drive-to markets? Based on the global study “A Data-Driven Look at Hospitality’s Recovery,” the rise of travel to drive-to markets has occurred mainly out of necessity. Following a long stretch of stay-at-home orders, we’ve found that people want to travel, but countries have placed restrictions on international travel and there is a general hesitance to fly. This is creating a perfect market for drive-to travel. In fact, our recent global study showed as many as 47% of consumers are most likely to take ‘local trips within driving distance’ in the next six-to-12 months, compared to 26% who foresee international trips and 25% who anticipate taking business trips.
What are some of the major takeaways for hoteliers? Hotels are going to have to adjust to this shift and refocus their business. Many hotels have been experiencing a loss in revenue over the last several months, so they need to make changes that appeal to the drive-to traveler in order to maintain profitability to keep their businesses from closing. They need to focus on developing operational solutions to reassure travelers, adapt to their changing needs and concerns, effectively promote the industry’s products, determine how to serve local communities and retrain staff.
How is this shift going to affect technology in the hospitality space? Travelers are looking for additional safety measures at hotels, which includes contactless and low-touch conveniences when they stay in hotels. Technology-driven hospitality automation is one way to minimize contact between guests and hotel staff. Hotels will want to consider implementing effective and efficient technology to replace many in-person interactions seamlessly and in a manner that is reassuring and not confusing for travelers.
In addition, the focus has previously been on distribution and property-level technologies, so customers would interact with various technologies for different experiences. For example, they might interact with one technology for their hotel experience, one technology for their food and beverage experience and yet another technology for a service experience such as a spa. Going forward, hotels are going to want and need to consolidate all of this into one unifying technology that can be used across all the different hotel areas to capture as much revenue as possible.
This need for one view of the customer across the property is and will continue to drive cloud adoption. Hotels already using a cloud platform found they had greater flexibility in recent months as well, as they were able to successfully monitor their business remotely, further reducing onsite personnel and providing a more socially distanced experience for customers.
While we are in this very unique period of reduced occupancy, many properties have found it to be an ideal time to move to a cloud platform. Doing it now allowed them time for implementation and orientation with minimal disruption for their guests.
What are some of the ways that smaller or independent hotels can prepare for this shift? This group is one of most impacted in the hospitality industry since they do not have the corporate support and mass communication across multiple markets that the larger hotel chains do. It is going to be critical that they quickly pivot to appeal to and accommodate drive-to travelers.
One way they can do this is to get creative with business offerings and provide useful service beyond the traditional hospitality services. For example, provide space that accommodates remote work for an elevated experience with high-speed internet, meals, a unique work environment such as a garden or patio setting and even a spa service or round of golf to end the day. Find those unique needs of the drive-to travelers and accommodate those.
What types of technology should they be implementing not only for operational efficiency but to ensure guests feel safe and comfortable while on property? Automation that minimizes contact between guests and hotel staff is ideal. For example, hotels should be implementing things like self-service check-in, contactless payment, keyless room entry through locks activated by smartphones, automated assistance for services such as F&B purchases and chatbots to replace staff interactions. Offering opportunities for people to still have the hotel experience they enjoy while having the interaction with the property and staff in a more contactless way gives them the confidence to continue traveling.
Do you think this shift is here to stay? If so, how can these hotel leaders prepare long-term? Yes, this technology shift is definitely here to stay. Many of these initiatives to introduce contactless options for guests were being planned long before the pandemic, but in many cases, the implementation was delayed because another initiative superseded it. Since March, implementing contactless options for guests has become a top priority.
Furthermore, when you look at the next generation of travelers, they only know a life with mobile devices. So, in addition to providing an extra layer of consumer confidence, this also helps the industry adapt to the preferences of this new generation.
That said, tenured travelers and those accustomed to luxury hotels are still able to have those luxury experiences. High touch does not necessarily equal high contact, and hoteliers can adapt to this new way of doing business while still offering a variety of options that appeal to their guests.
What are some cost-effective ways to implement innovative technology? Cloud technologies are a cost-effective way to implement many technologies. On the front end, there are no up-front capital costs or need for staffing for onsite management of technology, so those burdens and costs are immediately eliminated through its implementation. In addition, businesses are able to innovate faster with cloud technology than without, so moving to cloud technology accelerates the speed-to-market, allowing faster innovation to deliver more innovative services to guests.
Is there anything else readers should know about the rise in drive-to markets and how this is affecting hotel technology? Drive-to travel is here to stay, so don’t ignore this group of consumers. Travelers have traditionally viewed vacations as an elaborate experience requiring extensive planning and travel on planes or even trains. Now, they see that travel can look different. No longer does a trip have to involve booking airfare and having an extended stay to feel like a real vacation. Drive-to travel is easier, so travelers are more comfortable with shorter stays and more frequent trips. Hoteliers should look to see how to better serve the local traffic. How can the hotel innovate and adapt to provide fresh experiences that draw them in on a more frequent basis? For example, what are new promotions, services or changes in F&B that will appeal to these guests? And again, from a technology perspective, make sure to understand and capture the unique needs of the local travelers and market to and communicate with them accordingly.