Mixed Emotions: The Travel & Hospitality Industry Today 1Source: Frost & Sullivan Analysis, UNWTO, Hospitalitytech.com, Hospitalitynet.org, STR Consulting.
While it is true that COVID-19 had a devastating impact on the Travel and Hospitality (T&H) vertical, signs of recovery and renewed confidence are becoming evident. Domestic tourism is currently driving the improvement of the sector globally, particularly in those countries with large domestic markets. The staycation phenomenon, short-distance travel, open-air activities, nature-based products, and rural tourism are among the major travel trends that will continue shaping tourism in 2022.
In the United States (U.S.), in early February 2022, the Transportation Security Administration (TSA) screenings in airports trended upwards after hitting a 33-week low in January at 76 percent of 2019’s level.
According to the latest United Nations World Tourism Organization (UNWTO) Panel of Experts survey (conducted in January 2022), most tourism professionals (61 percent) see better prospects for 2022, and 58 percent expect a rebound this year, particularly in the third quarter. Nevertheless, a large majority (64 percent) anticipate that international arrivals will return to 2019 levels only by 2024 or later.
Similarly, restaurants continue to have difficulty creating sustainable momentum. Still, the National Restaurant Association in the U.S. projects the food service industry will reach $898 billion in sales in 2022, up from $799 billion in 2021, surpassing pre-pandemic sales levels in 2019 of $864 billion.
While 2022 is expected to be the year of the final recovery for the T&H space, there are still many uncertainties. Customers today demand reassurance, particularly concerning hygiene and safety. Empathy and always-on service are more important than ever before.
The Current State of Travel & Hospitality Customer Care 2Source: Frost & Sullivan Analysis; Driving Customer Loyalty, Travel and Hospitality Snapshot, Sitel Group®.
Customer service has always been relevant in the T&H industry. Sitel Group® research shows that 83 percent of consumers in the T&H segment identify customer experience (CX) as one of their top three most important factors influencing their decision-making process. Additionally, what people have to say about their own experiences is extremely significant, and 80 percent of the customers look at ratings and reviews before booking accommodations, while 72 percent do the same before deciding where to visit or eat. Undoubtedly, more than in any other industry, the voice of the customer expressed in rankings and reviews takes a prominent role.
T&H organizations are streamlining several internal processes (including mobile and digital touchpoints) and empowering customers with automation and self-service solutions since, on average, more than eight-out-of-ten hotel bookings are done without human intervention. Frost & Sullivan recommends that employing virtual assistants, chatbots, user communities, a useful FAQs section, and interactive voice solutions are the place to start, given that one-third of consumers (even more among millennials and Gen Z) prefer to resolve issues themselves. Alternatively, Artificial Intelligence (AI) and natural language understanding (NLU) technologies can simplify the journey by allowing users to share their intent in just a few words.
Even if the latest technologies are being deployed and processes are being rationalized, T&H businesses must focus on employee training and coaching to delight customers and create an emotional connection. How agents behave and perform ultimately determines a company’s relationship with customers. Employee experience and empowerment are paramount to improving CX.
Finally, it is needless to say that the first interaction with a location (including hotels and restaurants) is usually digital, while guests are exploring alternatives to meet their requirements. It is relevant that T&H organizations use the customer perspective to evaluate how a business or a property is presenting itself in the digital marketplace.
Moving Forward – The Digitalization of CX in the Travel & Hospitality Industry3Source: Frost & Sullivan Analysis, Hospitalitytech.com, 2022 Lodging Technology Study.
With a return to travel, business and social events are expected to continue to gain traction in the coming months. T&H organizations must be ready to not only meet the upcoming demand, but to create a memorable experience for every guest. With that in mind, prioritizing guest engagement tools will be key in 2022. Companies will need to make themselves available on the clients’ preferred channels and proactively engage with them.
According to the 2022 Lodging Technology Study:
- 74% of hotels either offer or plan to offer contactless payments in 2022
- 71% of hoteliers say enabling omnichannel reservations is very or extremely important in 2022
- 45% of hoteliers say enhancing guestroom technology is a top tech initiative
The in-room experience is a crucial component of the guest journey and several establishments are working to completely revamp and digitalize that space. Also, taking advantage of the customer’s mobile device is another important step towards improving the quality of the interactions and the guest experience by permitting them to control their stay, from check-in to room service to payment. Investing in a mobile app or a mobile-friendly website allows companies to engage with clients before, during, and after their stay and use it to upsell. For example, the company can offer a bottle of wine or rooms upgrade via messages or notifications or allow customers to make simple requests or report concerns.
The T&H sector is still in the very early stages of leveraging the benefits that Artificial Intelligence (AI) holds as a support tool. Capabilities range from training and supporting staff to creating guest data insights in real-time and helping team members deliver a better overall experience.
Ultimately, the key to meet increasing customer expectations lies in data and how organizations understand it and use it for personalization and branding to drive loyalty. Looking forward, data management and analytics will became a big area of investment in this field. By leveraging customer-provided data, personalized guest journeys can be created, including preferences for booking and tailoring room preparation.
In order to remove friction between guests and hotel employees, internet of things (IoT) sensors are also being implemented to allow staff, for example, to tell if a room is unoccupied, fostering a more efficient and less intrusive housekeeping service.
Additionally, digital experiences will go beyond virtual tours, and will aim to create stronger connections between guest and host, such as video messages from the hotel managers to welcome special guests or even recommendations from the chef to give room service orders a personal touch.
Organizations that want to remain competitive and relevant to their customers and employees should invest in leading-edge performance solutions and tools like the ones mentioned above, that enable improved guest engagement and experience, while empowering staff to perform at their professional best.
Juan Gonzalez has more than 15 years of experience in Consulting and Market Research applied to the Information, Communications and Technologies (ICT) Industry, with a particular emphasis in the contact center, customer experience and unified communications and collaboration industries. He is a thought leader, speaker, and passionate about how technology (and its adoption) is rapidly shaping the future of the world. Based in Miami, Juan currently serves as Research Director for Frost & Sullivan in the Americas.. He majored in Political Science at the University of Buenos Aires, and has a Master’s Degree in International Economic Relations from the same university.