The real impact of COVID-19 on hotel guest behavior and how hoteliers can speed up business recovery

The hospitality industry has never needed data more than it does right now.

Based on data collected through hotelbenchmarking.com from 350 UK and European luxury hotels, the report looks in detail at the actual impact of the pandemic on bookings, behaviour and revenue. We caught up with Managing Partner at 80 DAYS, David Gardner, to go through the findings, starting with a big one.

‘98% fewer transactions’

After a strong start to 2020, with rural and urban UK and European bookings up 35% on 2019, the pandemic hit Europe in late February. In the space of four weeks, European direct hotel transactions were down 80%, with UK hotels experiencing 98% fewer transactions. From the low-point in mid-April, transactions started to slowly pick up again, with European hotels experiencing a markedly stronger recovery.

Shifting priorities – Guests want clean air and open spaces

Fast forward to May and the average order value is up 56% on average year-on-year across 4-Star and 5-Star hotels in UK and Europe. A closer look at the data reveals that the draw of cleaner air, open spaces and fewer people has seen 5-Star rural booking values jump 137%, while urban hotels are up 37%.
The report offers an explanation: “It may be an indication of bookers starting to favour the security of more expensive flexible rates or an underlying switch to longer stays, especially in rural hotels.”

Customer engagement had a big impact

By the beginning of April, European and UK hotel traffic had fallen by 84% on average year-on-year. But some hotels managed to keep this as low as 40% through regular customer engagement, which also had a positive impact on transactions and revenue.
Figures are healthier for hotels that have continued to engage with their customers, whether it be via social media, email or marketing, experiencing decreases in traffic of just 55% versus the 84% average. For the most proactive hotels, the drop is as little as 40%.”

Travellers are looking for inspirational content

With a worldwide lockdown on travel, it’s unsurprising that “people are dreaming not transacting”, but the impact on the type of web content people are consuming gives hoteliers a clear steer in where to focus their attention. Page views for booking engines fell by 35%, while Gallery (+41%), Rooms & Suites (+52%) and Golf (+71%) page views were all up year-on-year. Most significantly blog page views were up 180%, showing most travellers were sticking at the inspiration stage of the customer journey.

What hotels need to do now – four steps to support recovery

As well as data on the age groups actively booking travel, and gender splits on order values, the report also outlined four key areas that hotels need to focus on to recover as fast as possible:

Research

“The solution is simply to stay closely connected to data about your customers’ needs – this is the most powerful filter through which to make investment decisions. Data surrounding consumer behaviour, spending trends and channel effectiveness should all be considered. Ensure that any analytics tools you use for any of your marketing activities are set-up to attribute the source of key interactions accurately.”

Brand & Positioning

“Has your target guest changed? Has their spending power changed? Positioning your hotel as ‘vibrant, bustling, in-the-heart-of-it-all destination’ isn’t going to appeal in the way it used to. Messages of discounted rates, escape-it-all and hygiene will be rife, and whilst you may need to employ some of these techniques, it is crystal clear brand positioning that will make you stand out from the masses.”

Marketing Campaigns

“Reduce marketing investments on campaigns that drive short-term sales but keep brand-building campaigns live. Short-term strategies will need to target ‘domestic’ customers and be ‘market-by-market’. Build ‘high confidence’ audiences based on queries users have previously searched. One of the most valuable assets any hospitality organisation has will be its customer database.

Content

“You need to review, refine and if necessary, rewrite your website content and communications based on actual customer need. Ensure your blog and gallery are regularly updated, and if your hotel benefits from a tranquil environment and access to open spaces, take this opportunity to reinforce these messages through all of your digital channels. A critical requirement of your content will be to instil a feeling of confidence.”
Download the full report here: Cutting Through The Noise – The Facts About Covid-19 And The Hotel Industry.