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Corona effects for hotels
The impactful corona situation presents a somewhat positive outlook in light of the now anticipated easing of measures. Although measures are being relaxed, the crisis will still have a long aftermath. Implementing social distancing in your hotel will not always be easy with current layouts or may even seem impossible. Naturally, hoteliers are doing everything they can to stay afloat. In this article, we share some facts and figures about the consequences of corona for Dutch hotels.
RevPAR for hotels in 2020
That the average revenue per room for hotels in 2020 has decreased compared to 2019 will not be a surprise. In a publication from Rabobank, it is stated that an average revenue decrease of around 78% is to be expected. Later in the year, this will be about 25% compared to 2019. Even in 2021, the effects are expected to still be somewhat noticeable. According to the NBTC, the aftermath of previous disease outbreaks, such as SARS in 2003, lasted about 20 months. The expectation is that the effects of corona will be felt even longer.
The average occupancy rate of Dutch hotels will in the most positive scenario be around 51%. The speed at which measures are lifted by the government will be very decisive for the average occupancy rate. Room prices, however, will typically not fall immediately; it can have catastrophic effects if hotels lower prices and thereby force competition to do the same.
For each hotel, the influence is, of course, different. Larger hotels in natural environments may find it easier to maintain social distancing. Hotels with a lot of business stays may have a longer time with limited occupancy. Especially hotels that focus on larger events and conferences will have a tough period ahead.
Challenges of hoteliers during the corona crisis
During my research, where I spoke with hoteliers about the situation and how they are dealing with it, I spoke to a hotelier, a user of MyTourist, in Nijmegen. The Netherlands' oldest city with a tremendous number of monumental buildings. Renovating and/or rearranging is not an option, as this is not permitted due to the monumental status of the building. The dating of the building provides a classic and luxurious experience, but the narrow corridors make it impossible to maintain a 1.5-meter distance in the hotel. One-way traffic is impossible to apply. How do you deal with the measures?
The conclusion of this story is that every hotelier has their own challenges during this time, but they are all connected. For everyone, the same question remains: how do we keep our heads above water and how do we ensure that we meet (and continue to meet) the stipulated guidelines? And that brings me to the first tip.
Collaborate with local hotel businesses
We see it happening everywhere, especially in villages and smaller municipalities. Cities sometimes seem a bit more distant. But seek each other out, think of (local) actions and collaborate to strengthen each other. There are many opportunities to foster involvement between hoteliers online as well. In these times, it's about giving and taking. Just because everyone knows the same issues, we create solidarity and understanding towards each other. And not only among themselves, but together, you can strengthen your position with your audience and address them centrally.
Last week, I walked through the shopping street of the village where I grew up while visiting a MyTourist user in the midst of the center. The flags, posters, and banners with the slogan “Good to see you, Thanks for helping us!” were unmissable. A wonderful joint action to lure the audience into the shopping street and support local businesses. Solidarity among entrepreneurs is clearly visible. Perhaps this is the beginning of more involvement with local hoteliers, as such collaboration can also strengthen each other in times without corona or other difficult periods.
Prevent (online) uncertainty and create clarity
Are you open and can bookings be made? Do you have adjusted times for facilities, check-in/out and reception? Can a vacation or stay go ahead, and what should guests keep in mind? Are there any adapted (cancellation) conditions? Communicate to your guests how their stay will proceed and how your accommodation has adapted to the measures.
Your guest would naturally like to know what to expect. And there are various options and channels for that:
- FAQ on your website
- Add information to the booking confirmations
- Video/animated or illustrated images on your website and social media
- Voicemail with adjusted telephone availability
- Autoresponder on email accounts
- Pre-arrival mail or newsletter with information and explanations
Your hotel website plays a crucial role during the corona period in providing information for ongoing bookings and convincing guests who want to book.
In short, there are plenty of options to keep your guest informed. This messaging is often wrongly cut back, but clarity helps you with accurate expectation management and prevents annoyance.
Cancellations due to Corona
Inevitably, but a well-thought-out approach prevents disappointment for guests and can commercially yield better results for the financial status of your hotel. Ensure that you know how to handle cancellations and what you offer your guests.
An exchange guarantee or relaxed cancellation terms can potentially convince guests during the booking process. Adjusting payment arrangements also helps. Consider working with vouchers.
Be loyal and remain receptive. Increase accessibility when necessary and possible. Your guests will appreciate the effort with empathy.
Don't stand still, think ahead!
Now, today, is the perfect opportunity to improve things you normally wouldn’t get around to. We see an increase in requests because hoteliers are engaged in improvements and optimizations in operational processes and findability. But we also see that our users are placing more rooms in maintenance than ever before. Get ready to get to work as soon as the opportunity arises and restore your occupancy rate.
Would you also like to focus on optimizations in internal processes during this time? Create a free and non-binding demo account and experience what MyTourist can mean for your accommodation.
On behalf of our entire team, we wish all hoteliers the best during this challenging time, where a cautiously forward-looking view shows positive results. The consequences of corona will continue to follow hotels for the time to come. Have the best intentions for your guests and fellow entrepreneurs, and it will do you all good.
