There is no doubt that the hospitality and travel industries have been among the hardest hit by the pandemic. However, some segments performed better than others, such as extended stay and economy hotels. The luxury segment, on the other hand, has been decimated. These properties have not only had to focus on recovery – and still need to – but have been forced to reinvent the guest experience and adapt to new demands. We spoke with Gregory Habeeb, President, North America, WorldHotels, about how luxury hotels can do this without losing the glitz and glamor of a luxury stay:
Why has the luxury segment been hit so hard by COVID?
It really depended on the destination and the markets they served. We had downtown luxury hotels that were being hit hard if they relied on international, corporate and group travel. These food markets did not travel due to restrictions on international air travel, corporate travel policies and the very destination they served also had legal limitations on group gatherings.
However, many hotels and resorts had some of their highest ADRs and best occupancies during COVID. This is partly due to a surge in luxury leisure travel and consumers staying in their country of residence or traveling to destinations within driving distance of their home. Our member hotels in sunny destinations like Miami Beach (home of the Eden Roc Hotel) and Southern California (with La Casa del Zorro in Borrego Springs) were booming.
What also impacted the luxury segment was the fact that many people did not have to work from an office and instead opted to work from a sunny or remote destination that offered the perfect place to social distancing, while enjoying nearby outdoor activities. It’s very different from a centrally located hotel that relies on restaurants, museums, shops, theaters and the like to be open.
What are some of the ways the segment has had to adapt to accommodate new protocols and expectations?
They say crisis breeds innovation and over the past two years we have seen many wonderful examples of this. For example, traditional room service has had to adapt to accommodate new protocols and expectations. To provide greater convenience to guests, hotels wanted to integrate food deliveries to guest rooms, but may have had to modify menu items with food and beverage choices that were better packaged and delivered hygienically. . With these new protocols in place, you couldn’t just place a stainless steel dome over the food.
Additionally, restaurants have had to remove some tables to create more space between each meal, reducing the number of people seated at a time. Those that also offered buffets had to turn to menu-only options. The reception operations of many hotels have also moved to contactless check-in. Despite these changes, most travelers appreciated the protocols and precautions taken by hotels.
How do you advise luxury properties to adhere to these protocols while meeting the expectations of a luxury traveler?
WorldHotels has created a program called We Care CleanSM. This global initiative has been designed with protocols for all of our member hotels and resorts to apply at their properties and gives travelers comfort and confidence that WorldHotels is maintaining the highest quality and safety standards during the global pandemic. At the height of the pandemic and still to this day, travelers want to know that they are safe and that their rooms and public areas of the hotel are clean and disinfected.
At the same time, you need to deliver a luxurious customer experience and value while implementing these protocols. Most travelers understood this and recognized that we were all in this together and doing the best we could. Many really appreciated the efforts of our teams.
Because we are a collection of independent hotels and resorts, each hotel has had the wonderful opportunity to consistently deliver a magnificent guest experience using the space around them. For example, we had hotels, like the Kimberly Hotel in New York and the Royal Park Hotel, that held outdoor concerts to provide entertainment for hotel guests while providing a safe space for everyone.
How has the luxury traveler changed? What are they looking for after COVID? What is different and what is the same?
Most hotels retain many of the same protocols. The luxury traveler has loved many sanitary procedures and now demands this level of cleaning standards, best practices and state-of-the-art protocols, even when restrictions are lifted. One thing that hotels have learned is about “traveler wants”. Some travelers do not want hotel staff to enter their room throughout their stay. Others are comfortable with daily maid service. Our hotels ask each traveler what their preference is upon check-in.
Additionally, we have noticed shorter booking windows from travellers. They wanted greater flexibility to change dates on their terms without penalties. Overall, luxury travelers always want to have a unique and memorable experience. That’s why they stay in independent hotels like ours.
What are the current challenges facing the luxury segment and how do you advise it to overcome them?
With these hotels enjoying higher ADR and occupancy rates, the challenge now is to understaff and train new staff on how to deliver the expected luxury guest experience. This staffing challenge was mainly caused by COVID and that affected the whole industry.
WorldHotels has a partnership with Forbes Travel Service which offers amazing training for most hotel departments that can be done both in person and via video. Many luxury hotels are faced with these shortages and new employees who may not have the experience of previous employees. However, better training will eventually help overcome these challenges. Additionally, many hotels have implemented additional incentives including raises, signing bonuses, or higher hourly wages to prevent current staff from moving into other industries and attracting new employees as well. These changes also lead to increased hotel costs which could be passed on to higher rates.
To overcome these challenges, communication between the hotel and guests is important. Maybe room service that took 15-25 minutes before the pandemic could take 40 minutes now and it’s up to each hotel to set expectations with guests. Poolside service may also be suspended due to a lack of service attendants or a more limited menu. The better you set customer expectations upfront, the better the understanding and overall experience for the customer.
What about opportunities?
One of the biggest results for many domestic hotels has been that they have had the ability to generate more loyal customers who would otherwise travel overseas. During this pandemic, travelers have discovered new destinations and tried new types of hotels. They might do both in the future, but have definitely found a “new home” with national hotels. They also tend to stay longer if they only travel within the country.
Many hotels have taken advantage of the “downtime” during COVID to re-imagine their properties, renovate and redevelop so that they can now offer a premium product and experience. It also gave hotels the ability to do things they couldn’t do when they were very busy.
What do you see on the horizon for the luxury segment?
Luxury travel is going to be a very strong segment. It is truly an exciting time as there are now many definitions of luxury. Hotel visionaries, developers, and managers tap into high-value guests and deliver all types of guest experiences. Consumers buy “trips” and accommodations like they buy other aspects of their lives. Sometimes they are looking for accommodations and travel experiences that are classic, modern, near the beach or downtown, on safari, in remote destinations, food-focused, and more. These can all be luxurious and provide the unique experiences the traveler is looking for. Some luxury travelers also want nonstop activities or access to local events, while others want peace and quiet.
Also, it’s good to keep in mind that many travelers haven’t ventured out like they did before the pandemic and have more disposable income to spend on a big, luxurious trip. You can expect to see “big bucket” travel experiences from customers looking to spend more on their next trip. Reunions with family and friends and wellness-focused experiences will also be popular this year. Activities like beach yoga, forest bathing, and nighttime fire pits are just a few of the hot new activities we can expect to see. Today’s savvy traveler might also seek deeper experiences and want to learn from locals, travel more mindfully, and seek out experiences that tap into their passions. This plays on the strength of WorldHotels.
Photo above: Glendoch Golf & Spa Resort in Glasgow, Scotland