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A Look At The Hospitality Industry After Covid-19

A Look At The Hospitality Industry After Covid-19

With virtually the entire country shut down, Covid-19 has undoubtedly devastated the hospitality industry — a total of $80 billion has consequently been lost so far, the National Restaurant Association estimates. Fortunately, however, it’s not all doom and gloom. Experts predict the industry will ultimately survive with several key changes in place.  

Prioritizing health and safety 

Avoiding workplace hazards in the food and beverage industry is an ongoing priority for business owners. Fortunately, workers’ compensation insurance remains an effective solution for employers and employees. It helps business owners cover the cost of medical care and legal fees if an employee sustains a workplace injury. After the coronavirus pandemic, however, employees and customers alike will naturally be hyper-concerned about health and safety. 

“You may be having dinner with a waiter wearing gloves, maybe a face mask, dinner where the menu is disposable, where…half the tables in that restaurant no longer appear,” comments California governor, Gavin Newsom. Jeremy Levitt, co-founder of Parts and Labor Design, predicts health and safety standards across the industry may get their own certification system like LEED. “Will there be a catalog of materials that fall in the ‘less porous’ category, thus being easily cleanable surfaces that germs can’t live on for long periods of time?”, Levitt wonders. 

safe at home

Despite this new-hyper focus on health and safety, guests can still look forward to a warm and welcoming experience. “Architects and designers will be looking at ways to make our new ‘defensive’ spaces — think plexi’d-off check-in desks — come off as warm and embracing. The challenge will lie in balancing the need to mitigate worry while at the same time providing spaces that invite guests to relax and enjoy themselves. Designers will need to tap into the psychology and emotional well-being of the guests more so than before,” explains W. Brian Smith of Studio Tack in Brooklyn. 

Luxury hospitality will endure 

While everyone’s set to experience the pandemic’s ongoing financial consequences, the high-end hospitality sector isn’t going anywhere. “After the financial crisis, luxury consumers did not curtail their spending. They simply changed their spending behavior towards less visible displays of wealth,” explains Keith Wilcox, associate marketing professor at Columbia University. Wilcox also predicts there’ll be a focus on personalized customer experience over visual aesthetics. “From a hospitality brand perspective, this means focusing less on ‘Instagrammable moments’ and more on experiences tailored specifically to customers’ needs”. 

luxury travel

Technology take over 

Guests typically prefer to eschew the use of technology in hotels and restaurants in favor for real human interaction. However, we can expect the hospitality industry after Covid-19 to start relying on technology to a greater degree than ever before. For example, contactless check-in and check-out along with keyless room entry will help minimize the unnecessary spread of germs and bacteria. Additionally, contactless payments and touchless digital menus in restaurants will become the norm. “It’s a new idea and it takes people time to accept it,” reasons W. Brian Smith. “I think what will happen as a result of Covid-19 is that a lot of hotels will use that as a reason to start doing those things with technology.” 

Big business boom

Unfortunately, many smaller businesses in the hospitality industry have had to close permanently. As a result, bigger, high-end chains are now left dominating the landscape. In fact, Hilton is already reporting a double digit increase in digital traffic and booking activity, while their total bookings have risen from 13% to 23%. However, hotels that are still in business may have been forced to close down their restaurants, which were formerly a huge profit source. Josh Collins, a marketer at Streetsense, a branding firm specializing in hospitality and travel, notes his clients are working to reopen their establishments with stringent social distancing measures freshly in place. Smaller hotels and restaurants may therefore be able to continue operating for some time at least. However, maintaining such a reduced capacity is certainly not sustainable in the long run. “Many of these small businesses are operating with razor-thin margins already,” Collins says.  

On the flip side, leisure travellers may notice an influx of deals and discounts offered as hotels try to attract the business they desperately need. As people continue to switch to virtual meetings, business travel has largely been cancelled for the time being — for example, major conferences like Dreamforce — which pulls an impressive 200,000 guests to San Francisco every November — have recently been called off. As a result, hotels will be focusing their marketing efforts on leisure travelers and potentially devise tempting offers to boost business.  

Hyper-local focus and the rise of the “staycation” 

“Restaurants with huge accolades and international presence rely on tourists and travelers who come to experience that,” explains Elizabeth Tilton, founder of hospitality services group, Oyster Sunday. “So they have to completely take that away and ask what it means to feed their neighborhood and to become hyper-local”. Several Michelin-star establishments have already adopted this approach: Eleven Madison Park has reopened as a soup kitchen to serve New Yorkers in need and Alinea in Chicago is serving carryout meals.  

safe at home

Additionally, people will choose affordable staycations over luxury international travel for the time being. In addition to hurting financially, many people are also concerned about the possibility of further waves of coronavirus outbreaks occurring — just look at the European tourists postponing their bookings at Noble House Hotels & Resorts in San Francisco (including the luxe Hotel Zoe and Argonaut Hotel) to later in 2020 or 2021. As a result, Josh Collins is marketing hotels to “staycationers” — locals looking for luxurious rest-stops after camping, roadtripping, or exploring a nearby national park, for example. Trips with a focus on outdoor adventures will likely be attractive to leisure travellers after spending months confined to their homes.

The hospitality industry has certainly been hit hard by Covid-19. However, travel is expected to gradually resume as the economy reopens. Although it’ll take a while for people to feel confident about air travel, they’ll be taking shorter stays nearer to home soon before long. 

 

Feature image courtesy of Pixabay

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