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The appetite for face-to-face meetings will wane next year with growing financial pressures being cited as the main reason.
Our latest look at the meetings and events market was taken through the eyes of our Business Opinion Omnibus and found that nearly half of all business leaders (47%) said their company would be using external facilities by the end of 2023.
Many of these recognise that getting people together is good for business with external venues having potential to make a better impression or offer additional facilities, such as catering.
However, looking ahead to next year, 27% anticipate fewer offsite events, with a further 15% undecided and the balance expecting roughly the same amount – a net negative outcome that potentially means fewer events overall as businesses brace themselves for a challenging 2024.
How does this effect spend?
28% of businesses are expecting to spend more on external meeting facilities next year, but this is partially fuelled by an expectation of increased prices rather than a sign of greater demand. Meanwhile, nearly a quarter (24%) of the businesses who said they were likely to reduce spend next year claim it is due to a perception of bad return on investment. But surely bringing people together, will be valuable, productive and a good use of time and money, with benefits that go beyond the immediate facilities on offer?
It’s not as easy as that, though, is it? There is nuance to every role, output, and its execution.
In a recent conversation with Amy Edmondson, Professor of Leadership and Management at Harvard Business School, we were able to gain some insight into the concept of ‘flexibility’ in the workplace – a hangover from the pandemic that saw us all in our home offices, with pyjama bottoms on, kids running in and cats strolling across keyboards.
“There is flexibility and there are relationships. You can’t have ultimate flexibility and deep relationships – you’re trading one against the other.
Flexibility can be defined as working wherever and whenever you want on tasks that are individually accomplished and modular, meaning the interfaces with other people’s work are uncomplicated. As soon as the interfaces are more interdependent, and tasks more complicated, then flexibility is at odds not just with relationships but with quality of execution.
Step back, look at the work first, what is the nature of the value that we are providing for our customers and how does that value get produced and if part of the answer is through teamwork, through the integration of people with diverse skill sets and areas of expertise, then we have to give deep and long thought to what kind of flexibility works best as a team.”
This view neatly underpins the concept that leads much of Microsoft’s ‘Future of Work’ strategy with AI playing a significant role in making asynchronous participation possible and synchronous participation better.
The balance between output, connection and becoming more cost and ROI-conscious in the face of growing financial pressures is a tough one to strike.
If business leaders’ predicted use and spend on external facilities hold true, we will see a shift towards fewer meetings and event,s and a need to better reinforce the value of those that do take place. One of the best ways to do that is for venues to deliver EPIC experiences and events that leave people invigorated, feeling productive and connected – wanting more, not less.
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For many leisure hotel guests, the creation of a meaningful and memorable experiences is particularly important, with holidays representing a significant opportunity to reconnect and recharge. A way in which we can judge the success of an experience is through the EPIC framework.
So just how important is EPIC for hoteliers, and how can it generate a positive guest experience? Responses to one of our surveys provide an interesting view of which brands perform best at delivering memorable experiences.
ELEVATION
Elevation refers to positive experiences which are out of the ordinary and unexpected. Brands that successfully differentiate themselves from competitors often have a unique offering that surprises and entices guests. A few brands that performed particularly well on this pillar in our research are Shangri-La, Four Seasons, Sofitel and Hotel du Vin. These are some examples of where hotels deliver elevation:
PRIDE
Pride refers to making guests feel valued, and staff play a key role in achieving this. This is where hotels have a significant opportunity to excel as taking good care of guests is at the core of the hospitality industry. Our ClearSight data shows that this pillar is, by far, the strongest for hotels. Brands that performed well include Malmaison, Mercure, DoubleTree by Hilton and Marriott. Here are some examples of where hotels are creating a sense of pride:
INSIGHT
Insight refers to discovering something new or gaining inspiration from your experiences. In a hotel this could be discovering more about your destination or learning more about the hotel itself. Our data shows that brands that performed best at this were: The Ritz-Carlton, ibis Styles, Four Seasons and Village. These are some examples of how hotels are giving guests insight:
CONNECTION
Connection refers to a sense of belonging and being surrounded by like-minded people. In the hotel setting, this generally refers to the sense of being at ‘home’. Our research found brands that performed best at creating this connection were The Ritz-Carlton, Macdonald, Ramada, and Hilton. Here are some examples of where hotels are delivering this:
Often quick and simple gestures can make a memorable impact on someone’s hotel stay. Personalised and caring service can make guests feel special and valued, contributing to building trust and encouraging repeat visits. This even was reflected in a LinkedIn conversation where we discussed the topic of memorable hotel stays!
During the pandemic, the residents of Venice found they were happier looking out on dolphins in the Lagoon than cruise ships when the sudden reduction in travel had an immediate impact on the environment around them.
Venice had been one of several global focal points for concerns about over-tourism, and this summer, the city submitted plans to control the number of visitors, in particular day trippers. The proposals were intended to encourage more permanent residents, limit the stock of private apartment rentals and bring in a reservation system with an access fee to manage day visitors. In July, it banned all cruise ships from sailing through the city centre. Good news for the dolphins.
Prior to the pandemic, proposals for charges to visit destinations such as Venice were met with objections over elitism – surely, it’s everyone’s right to visit St Mark’s Square? – but has the pandemic shifted that mindset?
We live in an age where there are more causes than room for badges on a jacket, but our research on brand purpose has found that messaging on environmental issues has broader support than other causes and much less distinction across demographic groups. Political issues may polarise us, but we’re united in our concerns for the environment.
That doesn’t mean that it is without its issues. Consumers have fears over greenwashing and whether brands are selling a message they’re not backing up with action.
And while concern for the environment is high, we have found that it is not the main motivator of leisure travel choices with the weather and price ranking at one and two, respectively. Sustainability trails far behind at 25.
While sustainable standards are not a key motivator of leisure choices, they are becoming a hygiene factor. If sustainable standards are clearly not being met at a leisure organisation, people may start to avoid it – now or in the future.
The good news is that people are happy to undertake a range of different sustainable practices, from recycling their rubbish to flying with lighter luggage. They also showed a willingness to make small sacrifices, such as limited access to conservation areas and a day without meat on the menu – small changes which have been shown to make a difference. Sacrifices should be re-framed as positive actions, empowering visitors to perceive they are helping, not losing out.
The urge to travel is strong and dreams of far-away places mean that long-haul flights will not fall foul of flight-shaming trends. But we have found that, when framed positively, behaviours can be changed to benefit all.
We are delighted that BVA BDRC is part of the Sustainable Hospitality Alliance, reinforcing our commitment to a low-impact future and using our skills to help the sector work on a cohesive response to the challenge posed by the climate crisis.
The sustainable movement will be the defining initiative of our times and it is vital that we all contribute towards its success.
As an independent research specialist, we can help shape the conversation, ensuring the sector remains connected to the views of travellers, guests and consumers and can retain control of the story.
Our membership of the Alliance will add to our B Corp initiative and commitment to the MRS Net Zero Pledge and MRS Inclusion Pledge, allowing us to use the tools of our trade to help make sense of the world and contribute to a more sustainable future.
Our research has found that consumers wanted to be more sustainable and are calling on companies to “help me help”, creating a so-far-untapped opportunity for hotel brands – in fact 76% of the UK public were ‘very concerned’ about sustainable issues, led by environmental over social.
Given the choice between similar hotels and similar choice with one offering better sustainability offerings, an overwhelming majority chose the sustainable hotel. This was the same when the price went up by 5%.
We believe that companies who help their customers make better sustainable choices can build loyalty and profitability.
The sector is concerned that sustainability is a burden; a tax on operations or an issue for the legal department. We feel that we can help all stakeholders recognise the business opportunity that becoming sustainable provides.
We joined the Sustainable Hospitality Alliance as it launched its revolutionary Pathway to Net Positive Hospitality, providing guidance to help every hotel work towards net positive environmental impact, whatever their starting point.
The Pathway to Net Positive provides a practical, four-stage guidance framework as a free resource that supports all parts of the hospitality value chain to progress in a cohesive, strategic manner. It includes detailed action guidance for hotel operators, brands and asset owners, applicable to both single or multi-unit organisations.
The Pathway recognises that sustainability is crucially important to the sector’s long-term success and that all businesses need to evolve and innovate as stakeholder needs and expectations change.
Sustainable Hospitality Alliance members make up 30% of the global hotel industry by rooms and include 16 world-leading hotel companies with a combined reach of over 35,000 properties and 5.5 million rooms.
According to the United Nations World Tourism Organisation (UNWTO), the hotel sector accounts for around 1% of global carbon emissions and this is set to increase. Hospitality, like other industries, has a responsibility to manage its impact on our planet.
Research conducted by the Sustainable Hospitality Alliance found that the hotel industry needed to reduce its carbon emissions by 66% per room by 2030, and by 90% per room by 2050 to ensure that the growth forecast for the industry does not lead to a corresponding increase in carbon emissions. The industry will need to go even further to help limit warming to 1.5C and avoid the very worst impacts of climate change.
The hospitality sector has faced a series of disruptions in recent years, from the online travel agents, to peer-to-peer lodging and now the shifts in customer behaviour driven by the pandemic. It is only by acting in harmony that the sector has been able to navigate these issues.
Collaboration will be key to success in achieving sustainability and we hope to be able to act as a trusted third party to the Alliance and provide the opportunity for members to share data without fear of revealing information to their competitors, and with no commercial agenda.
The 2022 Hotel Guest Survey found that 80% of leisure guests had already booked a domestic stay, or were highly likely to, with city breaks the most popular choice. The cost pressures being felt by the consumer were also a factor, with value for money driving booking decisions.
Consumers are becoming more comfortable with the idea of booking an international holiday, but while we are seeing those green shoots for outbound travel, nearly twice as many adults booked a UK holiday during January – the highest incidence since the start of tracking.
Comfort with the idea of staying in hotels and other types of paid-for accommodation jumped significantly as Omicron-driven fears receded and the accommodation sector is closing in on the pre-pandemic norm in terms of consumer comfort levels.
What remains to be seen is whether this recovery will endure, or whether this is one final hurrah before the cost-of-living crisis starts to bite. As we saw from our survey, value is a driver for consumers and there are further factors heading towards us, including the energy price cap increase and possible economic repercussions of Putin’s war on Ukraine.
The domestic leisure market has dominated the sector during the pandemic, with an average of 3.8 leisure trips taken over the past two years, against 1.3 domestic business trips. Beach and resort breaks were popular, as more exotic climes were unavailable.
Jane Pendlebury, CEO, HOSPA, said: “The pandemic drove a rise in domestic holidays caused by necessity – we needed a break but we couldn’t leave the country. In the event we rediscovered what we knew before the growth of budget airlines, which was that the UK is full of wonderful destinations with hotels, restaurants and pubs which offer unique and welcoming experiences.
“Many guests have realised that the UK is not a second-choice destination, but somewhere to explore and be inspired by.”
Ben Harper, group managing director, Watergate Bay Hotel, Another Place and Beach Retreats, added: “The domestic market isn’t a new one, we had been booming before the pandemic. I’m confident of the short term, but I feel even more confident about the medium to long term. There is such an inconsistent landscape in the UK – and no leading brand – which presents a great opportunity.
“Domestic leisure markets across Europe have seen growth in interest from investors, who are looking to build platforms and brands which will bring them healthy returns, but also keep pace with the demands of the mass-affluent travellers who want exceptional design and memorable experiences. These businesses successfully reduce seasonality and create lifestyle through brand.”
Our study found that confidence was growing, with 47% of UK consumers happy to book a domestic trip to be taken in a few months and 32% to go now. As guests have become more comfortable with staying in hotels, they have also started to return to the cities. Looking at future intent for the next 12 months, 47% were planning a city break, while 34% wanted to visit a local area or attraction and 32% were aiming to visit friends or relatives.
David Orr, CEO, Resident Hotels, said: “Whenever restrictions were loosened during the pandemic, we saw people eager to return to the cities, to meet with friends and family, to reconnect with culture and nights out; looking to rediscover the normality the pandemic and strict lockdowns had denied us all, regardless of age.
“We are delighted to see still seeing life return to the cities, recognising that people seeking those lost experiences more than ever cherish and value those moments, so even more focus on “reputation” when it comes to booking a hotel. Reputation is a fundamental qualitative test that reaches across feeling safe and secure, knowing that the teams are looked after well and that guests are looked after well. Reputation uniquely informs the decision of a guest as well as a team member to put their trust in you. Cities we all hope are returning quickly to being the most desired and dynamic of destinations, yet reputation and trust underpins all judgement guests will make when considering investing in their experiences. It is the team at The Resident which the reputation of the hotel is built upon and which will see it become a much-loved destination for a lifetime as we move forwards.”
The survey found that having had a good experience in the past was behind many bookings.
Kevin Edwards, Alliants, said: “Experience is one of the drivers behind booking, in this case experiences which people have had in the past. This is clear proof that, if you want to create those lifelong connections with guests, which will see them return as well as recommend your hotel to friends and family, then you need to focus on experience.
“The hotel sector had become convinced that memorable experiences can only be delivered by a vast team, but the pandemic has persuaded a growing number of hotels that technology can be used intelligently to both free team members to give better service and, with messaging, help create those important bonds. This becomes even more relevant when you see that guests are conscious of value: no-one wants to pay for swarms of staff hovering ‘round reception.”
Many in the sector felt that, once international travel had become more certain, consumers would revert to old patterns and return to their search for summer sun. Instead we can see that the domestic market has outlasted the pandemic and, with the added influence of concerns over price and the impact of travel on climate change, may remain buoyant.
To continue to attract guests, hotels must appreciate that they no longer have a captive market, but must compete, if not on the weather, then value and experience, as consumers look to make the most of their time and money.
Learn more about Hotel Guest Survey.
This is a controversial question – especially for me, having worked with hoteliers for the last seven years – but it’s one I’m willing to put out there to share learnings in the customer experience (CX) arena. After all, we learn from the best.
Hotels were known for providing and leading the way in customer experience, well before we even knew that it was a thing. Hotels are hospitality, and hospitality is CX.
Let’s compare retail CX to hotel CX for a moment. How many shops have you walked into and the assistant tries not to make eye contact with you by looking busy? Or the banks with their vacant counters and building queues while the only visible staff carry out their paperwork? Compare and contrast these experiences with the hotel receptionist trained to drop everything to greet you, or the general managers patrolling their lobbies welcoming guests. Which one of these elevates the customer?
It can be argued, of course, that the likes of John Lewis are much better at CX than the average retail outlet, and Metro bank provides more opening hours than other high street banks. And not all hotels are perfect – some fall a long way short. But, in my opinion, an ‘average’ hotel still trumps even the very best from other sectors.
So why am I putting it out there that homestay may be leading the way in CX?
I’ve recently returned from a trip to Porto. I booked a 2-bedroom, 2-bathroom apartment with a mezzanine and three balconies. I paid around £140 a night for this beautiful apartment, centrally located and immaculately kept. Yes, it was off-peak, but when I looked for a hotel bedroom for £140 a night during the same weekend, I didn’t get a suite, kitchen and three balconies.
However, astounding as they were, it wasn’t the facilities that elevated my experience; it was the hosts.
Before arrival, the hosts contacted me to tell me they were ‘excited’ about our visit and asked what they could do to provide us with ‘the perfect stay’. They gave us local recommendations, a virtual Porto brochure and offers of help to get from the airport. I noticed on the Airbnb app that it tells the booker how quickly hosts reply to their guests, and mine said ‘less than one hour’- that’s impressive!
On arrival, they allowed us to check-in hours before for no extra cost. They waited for us to arrive and provided a guided tour of every facility. Along with this, an honesty bar was available with a personalised wine selection, a local’s manual, a complimentary bottle of port, a message each morning to check we slept well, and whether they could do anything to assist – the list goes on! How many hotels are doing this at £140 a night?
It got me thinking: how can hoteliers compete with this personalised experience? How can they motivate staff to go the extra two miles for their guests (because one is no longer enough)? Is it a matter of ownership? For the most part, your Airbnb host owns the property you’ll be occupying and it is that owner with whom you interact; its reputation as a property and their reputation as a host are one and the same. Every customer experience, because there are relatively few of them, links directly and doubtless very visibly to the likelihood of getting a future booking. The same is less frequently true of a branded hotel and maybe that’s the issue.
A cult-like following
In the Western world, at least, users of Airbnb overwhelmingly become advocates of the concept and the site. I count myself as one; despite hearing about several bad experiences – the sort of experiences you wouldn’t get with a hotel – I have no qualms about booking with Airbnb or recommending it to others.
It seems I’m not alone. Our Hotel Guest Survey records relational Net Promoter Scores amongst recent users of the brands it tracks, and in 2021 Airbnb consistently places ‘on the podium’ throughout Europe and the USA – displaying a level of consistency that most hotel brands would kill for.
So, is homestay a leader in CX? Our research and experience suggest the answer is ‘Yes’, and it’s down to those super hosts who elevate the guest experience with memorable moments.
Learn more about our approach to customer experience and the power of memorable moments.
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