Many changes are around the corner for the upcoming year, especially for the hospitality industry. Between the optimism about a COVID-19 vaccine and fluctuations in the marketplace, it’s difficult to gauge how the cards will unfold next year.
As a leader in the industry, Valor Hospitality Partners got together with our CEO, Euan McGlashan, to gain some insight into what lies ahead for the future. What we learned are the top 10 predictions for 2021. Here’s what he had to say.
Top 10 predictions for next year
Q: What will become of occupancies in the upcoming quarters?
A: “I think occupancies, in general, will bounce back stronger in the summer than most are saying. I could imagine by Q3 or 4 of 2021 that we are back to as high as 75% of 2019 trading levels. By mid-2022, I think the industry will be almost back to par occupancies. Rates may be longer with 2019. Key will be meetings and events business.”
Q: How do you think the global market will respond?
A: “I think there will be a massive marketing push by all the big international brands to be first to market to offer ‘normal’ experiences and begin dropping plexiglass at front desks, removing social distancing stickers and tape everywhere, and dropping mandatory masks in the lobbies, as well as opening up all F&B spaces. Guests are adults, and I can see marketing that suggests the hotel is clean and safe but asks guests to act safely.”
Q: Are you optimistic about the issue of precautionary health measures, like the need to wear masks and gloves in public?
A: “Staff’s mandatory wearing of masks and gloves will be dropped by Q3 of 2021.”
Q: What are your predictions for the ‘new norm’ for inter-office communication among colleagues?
A: “I also think meetings will begin to return largely stronger than predicted, and there will also be a big marketing push to offer meeting rooms where you can have in-person groups but also a large screen that allows those who wish to remain virtual to attend via video.”
Q: How will information technology and AI adapt to the market place?
A: “There will begin to be a bigger and quicker shift to digital keys and technology, which allows less human interaction and less human contact with staff and surfaces. The industry was headed this way anyway, but companies will bring forward CAPEX that was perhaps slated for further down the road and focus on seamless technology.”
Q: What do you anticipate in terms of community engagement next year? Will big social occasions and celebrations be making a comeback?
A: “We will see a big upsurge in wedding bookings, and 2021 and 2022 could be record years for both weddings and social events. Meetings will be softer, but hybrids, as noted above, will become commonplace.”
Q: There have been predictions in the media about an optimistic economic future, while others warn that many uphill battles lie ahead. Do you agree or disagree that current progress will lead to a stronger economy with less competition in the months ahead?
A: “Despite the hope, it won’t happen. I do think there will be price wars, and discounting will be prevalent at least in 2021.”
Q: What about the hospitality industry, specifically? Will there be a quick turnaround for the global tourism market next quarter?
A: “International travel will pick up far quicker than imagined, and I suspect airlines will see strong occupancies from May 2021.”
Q: How do you think private spaces like hotel properties will respond to these fluctuations in the market?
A: “New hotel construction will definitely slow dramatically. However, many hotels will receive major renovations, and outside of technology, I could see a redesign of F&B and public spaces to entice guests to stay within the hotel properties.”
Q: What about the space inside the hotel properties — will the future of hotel designs and practices be drastically different next year?
A: “Room service will continue its slow death, and delivery to rooms will be a knock and drop.”
Preparing for the future
With CEO Euan McGlashan’s predictions in mind, the 2021 marketplace is sure to be a new experience for many as the country navigates foreign territory together. During such an unprecedented time, you will want support from experts who know the landscape.
Valor Hospitality is strategically located around the world, providing our team of experts with invaluable insight and perspective to connect across cultures. Let’s get in touch to see how we can make a difference for you.