Big changes in consumer trends and the accompanying move towards innovation are the new key units of analysis that hoteliers have to seriously take into account when planning on your next strategy / move. At the 2017 Hotel Management Summit in Singapore, Trend Watching has shared some interesting insights that are important to understand and take advantage of with this new wave of changes. In particular, looking at innovation in order to not only effectively target and reach the right market (your hotel guests of the future – revenue) but also to build customer loyalty (long-term for revenue maximisation).
The ultimate goal for any financially-driven organisations is, of course the bottom line. So how do you know that you are targeting the right consumers who are giving you just that? According to statistics published by eMarketer (2016), Asia will surpass North America as the largest digital travel market at USD 216 billion by the end of this year, further supporting the growing purchasing power of consumers in Asia.
With more spending power and innovation, comes great expectations. Innovation creates new emerging expectations from consumers and shifts their consumption behavior. For example, a study by Uber shows that their consumer patience based on willingness to wait in 2013 compared to 2014 had decreased by approximately 2 minutes (from 7 to 5 minutes). The longer Uber has been in a city, the less consumers are willing to wait for their cars. So, with this information in mind, how will you ensure that your guests will not be waiting for more than 5 minutes at check-in?
It is no secret that people derive their status from the stories that they constantly tell about themselves, along with their experiences. It is therefore important to understand that their consumption behavior is sensitive to the perception of their peers or to the opinions of those who matter to them. Public validation is everything.
The status symbol of ‘living it large’ through consumption of luxurious consumer brands such as Louis Vuitton and Gucci may once have been the epitome of status, however this may no longer be the case for some. Welcome the new trend of ‘Wealthy’. It is not enough to be rich. Consumers now consider peak physical and mental wellbeing as status symbols.
This is supported by a study which shows that 80% of Chinese consumers said they had started to eat more healthily, while 40% indicated an intention to spend more time playing sports (Credit Suisse, 2017). On top of that, 75% of consumers associate mental health with ‘health’, while 58% and 43% associate quality of sleep and mindfulness with it too (The Well Economy, JWT, 2017).
Notice the huge success of Lululemon with its mass event at the Forbidden City seeing 3,000 people practiced yoga together or the partnership between Wallpaper* & Swissotel that created a wellness-focused hotel suite features circadian lighting; while Westin Hotels go as far as to create a new kind of experience with in-room live-streamed spinning classes.
Status will continue to evolve as people increasingly use social media to show off even more now in real time. It is no wonder that applications such as Instagram or Kuaishou, a live-streaming app has oven 50 million active daily users. The question is beyond whether you can introduce initiatives that boost your guests’ well-being throughout their stay. It is important that no matter what strategy is implemented, make sure that your product or service is Instagramable.
We have established that right now, it is all about the stories and the experiences. Disney would not invest in such project as an immersive Star Wars-theme hotel set to open in Florida, if there were no substantial research or demand to back this investment. Going one step further, the experiences are now digital. Look at Sony Pictures creation of VR experience that simulates Twin Tower tightrope walk! Applying this knowledge to the hospitality industry, how can you provide collectible stories for guests throughout their stay that will set you apart from your competitors?
Consumers are now using messaging apps as a one-stop lifestyle solution platform. Six of the world’s top ten most used apps are messaging apps (Quettra Analytics, 2015) and for those using WeChat, average users spend 66 minutes per day on the app while 33% of users spend more than 5 hours on it (Tencent/Penguin Intelligence, 2017).
In leveraging this type of platform, hotels can create tailored marketing content to target consumers. The next questions are whether you understand what platforms you can use to deliver the same level of convenience and seamlessness and whether you can go beyond to convert these communications to build consumer loyalty.
Not only are we as consumers are exercising less patience, we are now demanding simplicity as our right when it comes to consumption. 74% of travelers find figuring out details as the most stressful aspect of travel (Google, 2016). So how can you make it easier for them?
Get inspired by intuitive interfaces such as Kayak, a travel site that lets users book hotels via Amazon Echo!
Consumers are looking at AI-powered services to help make smart decisions and provide seamless experiences. 50% of global smartphone users think that smartphones will be a thing of the past in the next 5 years, with artificial intelligence superseding many of its functions (Ericsson Consumer Lab, 2015).
In maximizing value for consumers, we have seen examples in Google Flights using AI-powered services to notify consumers when flight tickets will become cheaper or Air New Zealand using HoloLens to anticipate travelers’ needs. So the question begs, what are your next moves in using AI to provide innovative services grounded in fundamental human needs that will lift you to the forefront of hospitality?