A SUMMARY OF THE KEY MESSAGES FROM
HOSPITALITY TOMORROW: A GLOBAL VIRTUAL CONFERENCE
7TH APRIL 2020
Organised by Benchmark Events and attracting 5,343 ‘delegates’ from 128 countries and gathering 1.92m twitter impressions (www.hospitalitytowmorrow.com; #hospitalitytomorrow)
Note: This document was shared with the WTA by Professor Terry Stevens, Founder and MD, Stevens & Associates
This summary has been prepared by Alastair Dobson, businessman and Director of Visit Arran DMO (www.visitarran.com) from the Isle of Arran, Scotland; Tim O’Donoghue, Founder and CEO, The Riverwind Foundation (www.sustainabledestination.org) from Jackson Hole, Wyoming, USA; and, Professor Terry Stevens, Founder and MD, Stevens & Associates (www.tourism-futures.com) from Wales.
During the course of this six-hour virtual conference the three of us listened carefully to the comments made by the speakers and panellists. We monitored the twitter comments that flowed through the day and the questions raised by participants. Although all the sessions and the various presentations will be made available on-line by the organizer, we thought it would be helpful if we compiled a schedule of the key messages that we took from the day.
We have deliberately not ascribed specific quotes to various speakers we have set out below the notes we made during each session. Some sessions had more than one speaker, so we have listed the names of each of the participants in each session.
If we have misinterpreted the sentiments or the facts presented on the day, we apologise. Our intention is to reflect the main points and to share them with a wider audience. It goes without saying that the reader should access the on-line original presentations to secure what was actually said at the time.
THE KEY MESSAGES BY SESSION
Paul Stoltz, Founder and CEO, Peak Learning and author of ‘Adversity Quotient (AO)’ (www.peaklearning.com) on ‘The Greatest Adversity of Our Time’.
It is all about mastering the C.O.R.E. strategy:
C – Control – Worry about what you can influence and less about what you can’t
O – Ownership – Own the REACH
R – Reach – Where and how can you manage any crisis and resultant fall out and how can you use that to create an upside
E – Endurance – How can we use the learnings of what we have done by taking things head on and how do we ensure we add it to our resilience plan for the future. Specifically, for this incident reinfection or new infection locally or pandemic
Turn adversity in to fuel to drive us on to a place we would never have got to.
Use the time we have now to repurpose, reinvigorate and make our businesses leaner, meaner whilst keeping and developing core values
Be the ones people flock to first – stand out from the crowd
You can test how you have harnessed adversity by looking back and see what you have done and determine whether you could do it even better.
IQ v AQ – Understand the difference. Great leaders have a heightened AQ. Leaders use this to bring confidence and security to their teams.
- Legacy, sustaining and growth through adversity with Amr AlMadani, CEO of the Royal Commission of AlUla experiencealula.com
This is a profound time for our economy, our industries and our communities. Focus even more on culture, communities and conservation. Connect them with the visitor.
Stick to the facts and the reality to help re-engineer the economy
Communicating in a crisis with Peter Greenberg, Travel Editor of CBS News (www.petergreenberg.com); Wolfgang Neuman, Chair of International Tourism Partnerships at the Hague Hotel School (hotelschool.nl) ; and Arnie Weissman, Editor in Chief, Travel Weekly (www.travelweekly.com)
- People will continue to travel but we need to understand new expectations and motivations
- Communication is the key (both internal and external) and this is important during and after the crisis – who has got the trust and the credibility = time to re-build and admit what you don’t know
- Deeper engagement with place – experiential and emotional
- Deepen offers by working with communities
- Peoples values for travel will have changed – not flash but wellbeing (instagrammers)
- Lower the barriers to partnerships. Community/Industry. Industry/Industry. Public/Private
- Be adaptable fleet of foot and keep it simple. Important to be able to communicate this
- We can’t let people down
- We need to build in future resilience
- Experiential and differential will win the race
- Human connection – how we live our lives – develop a clear proposition
- Must have crisis management teams and strategies at all levels
Future Economics: Conditions post COVID19 – Roger Bootle, Chair of Capital Economics (capitaleconomics.com) https://www.capitaleconomics.com/about-us/our-team/roger-bootle/
This was a very (maybe too) positive approach and outlook centred upon:
- Medium term prospects are good
- People will want more experiences not more things
- It will be increasingly about differentiation + value and not price
- Business tourism will never return to pre COVID19 levels
- Leisure travel will emerge first and on a staggered basis but when?
- Move away from globalisation will accelerate
- COVID19 will bring further economic and structure crisis to EU
- There will be a surge in demand if we get virus recovery and immunity
- Look at roaring twenties following Spanish Flu and Chinese growth following SARS as examples
- There will be a “V” Shaped recovery. This was challenged later to be more of a “W” Shaped with the middle of the W not being anywhere near as high as illustrated
- There will be winners who will deal with the situation honestly and losers who will deal with the situation sceptically
Creating Global Connections and Coalitions with Roger Dow, President of US Travel Association (https://www.ustravel.org/profile/roger-dow) and Hon. Minister Najib Balala, Ministry of Tourism and Wildlife, Kenya (tourism.go.ke)
Roger Dow gave a strong set of thoughts and seems to have the ear of US Governments both State and Federal levels. His key points were:
- There will be tone deafness if we talk about recovery too early
- The world of travel will open up slowly
- Partnerships and collaborations essential for the future
- People will want to demonstrate national pride by holidaying at home
- If managed well there will be a move away from volume over tourism to value for money quality experiential tourism. Over tourism will need managed in rural areas close to urban areas
- Marketing must excite our existing and new markets Wellbeing/safety/care
- Now is the time to re-engineer culturally and emotionally
- Each different area and business will overcome this situation at different times. This should be recognised in marketing
- Be agile and fleet of foot
- Care most about the people that live next to us – understand better essential workers, your local supply chains and how you, your community and your customers want to live their lives
- No-one should ever take a tourist for granted. They could be the most important person to walk down your street in post-Covid world.
- Banks are crucial vehicles for funnelling money into the ‘right’ projects
The post-Viral Investment Landscape with Andrew Sangster CEO of Hotel Analyst (www.hotelanalyst.co.uk), Desmond Taljaard, MD Hotels at L&R (www.landrhotels.com) and Paul Slattery, Director at Otus & Co. (www.otusco.com)
- OECD predicts a decrease in global GDP of 2% for each month of crisis
- Hospitality is already challenged with BREXIT low profits, HR issues, high rates etc.
- Lots of mergers and acquisitions likely
- There are too many hotel brands in Europe and UK
- It is even more important to excel locally and that will open up potential international markets in the future
- It could be difficult for smaller operators to capture new demand due to cashflow. Bigger brands that will do well are those that connect at all levels such as Accor.
- It is more important than ever that smaller operators collaborate to succeed.
- Twice as many people leave UK on holiday than come. Present UK infrastructure and offer cannot cope with that potential volume of leisure travel.
- Visitor experience
- Business will adapt as will the traveller by changing offer and expectations
- Potential for OTAs to be “put back in the box”. New relationship at worst
- Airbnb is “toast”
- Family owned business and small chains will be most at risk. Fear of eroding balance sheet should be tampered with investment for future. Done well working capital will return to good businesses.
- Will there be hotelier Price Wars? The industry does not want to race to the bottom of ADRs, especially since hotels won’t have the staff for high occupancy at first. It will be hard to bring ADRs back up. Hotels are renegotiating their contracts, loans, etc. – this may affect housekeeping staff and ability to do “extreme cleaning”
- It took European hotels six years to recover from the 2008 economic crisis
Where are the Green shoots? With Robin Rossman of STR (www.str.com) and Oliver Jager, CEO of Forward Keys (www.forwardkeys.com)
- People are searching travel sites more than ever before and there are also some signs of forward bookings further out than 3 months being up.
- RevPAR following credit crunch took 5 years to recover but it is expected there will be a sharp upturn next year to approx. 909% with a total recovery by 2022
- Domestic (2-3 hours surface travel) will recover much faster and is the big opportunity
- As already highlighted a “W” or “hockey” stick shaped recovery rather than “V” shaped
- It will be bumpy for a while
- Remember it appears that the majority of the population are immune from this virus, but we must prepare for other pandemics
- Property and inventory have not been lost and financial systems are still in place; hotel performance pre-COVID19 was already wobbling as supply had outstripped demand
OUR OTHER HEADLINE TAKEAWAYS
- What we must do is to harness this crisis to create a better world
- There will be a new normal of doing things ‘right’
- Stronger global leadership is needed
- 2009 Oxford Economics and then Bill Gates in TED talk in 2015 predicted this pandemic – we need to listen and get better prepared for the future
- At best 2020 will be 30% of 2019 in terms of visitor numbers and associated revenue
- Will this episode mean that tourism will be taken seriously in the future?
- In industry must become very reactive, dynamic and agile in the future
- International travel will re-emerge slowly, salvation will be found in domestic travel
- Leisure travel pricing that has a safe, quarantined package may be at a premium
- Economic recovery will be affected by the size of internal markets (e.g., China has a large internal market)
- Destination management will be the key to success – it is not about destination marketing
- Destination health system performance will impact visitor numbers – the carrying capacity of a destination will now need to address the local health care system capabilities
- Wellness sabbaticals and the return of the social holiday and holidays on prescription to return
- Restaurant capacity will be affected by social distancing standards and have rippling effect on the overall destination carrying capacity
- Independent lodging properties are more vulnerable than chains, especially those that weren’t on strong financial footing to begin with
- For the near term, save on sales and marketing funds and focusing on investment money
- Some countries / destinations are relaxing environmental regulations to help economic recovery (including the USA)
- Permanent Effects: Less business travel than leisure travel since business will be more digitally driven. That means group business travel that can be the bread and butter for some hotels will be impacted.
- Until we get global vaccines there won’t be a return to normal – this could take 18 months
- Practical measures will prevail – from toilets outside of restaurants, temperature testing before entry, social distancing inside and re-thinking service standards
- New habits, new trends and new realities – ‘The crystal ball is very foggy – we will return to a new normal but where and when will vary’
- Maybe time to think more about the software of tourism (people) than the hardware.