Why the Corona Virus Crisis is a Unique and Once in a Lifetime Opportunity for Destinations and the Hospitality and Tourism Industry.
#StayHome, for now, is happening all over the world. For the hospitality and tourism industry, it is probably the largest hard-hit and challenge ever.
The Corona Covid-19 crisis, the travel ban, the closing of borders and all the other measures governments globally put in place, will change everything in this industry forever. Nothing will be the same as it was before.
But this is actually a good thing for Destinations and the Hospitality and Tourism Industry.
This crisis is a once in a lifetime opportunity for the industry, if Hoteliers, Activity Providers, In-Destination Tour Operators, and entire Destinations take the current crisis situation as a unique opportunity to come out of the crisis and restart their business much better off than they have entered into this crisis.
This unique opportunity and time is NOW while the entire travel, hospitality and tourism industry has reached the level of almost ZERO occupancy and revenue. This quiet time provides the opportunity for all of us to rethink the way forward. Everybody will be starting at the very same level.
Since Online Travel Agents such as booking.com and others have become market-dominant in the last decade, Hotels have paid 60% to 80% of their profit to them, plus they have handed over the customer ownership. For quite some time it was not sustainable anymore for Hospitality and Tourism businesses. And with this crisis, it has become worse.
However, since the Hospitality and Tourism Industry has been very slow for the last 10+ years in the adoption of new technology and to obtain new market opportunities while the customer behavior changed, Online Travel Agents took over and Hotels around the world have become dependent on them and paying a premium. In fact, in many cases an OTA makes more money with a booking than the Hotel itself while hosting the guest, providing breakfast, etc.
Now in this Corona crisis, which has hit Hospitality and Tourism instantly and harder than many other sectors, Hotels around the world are furious with Online Travel Agents such as booking.com. Obviously all OTAs and many other platforms have been completely overwhelmed and could not at all cope with the number of requests and inquiries received from their customers. Guests in their desperation went directly to Hotels asking for assistance.
Also, see this Article on Phocuswright – How Italian hoteliers are coping with coronavirus fallout.
Hoteliers tried to handle customer requests for cancelations and refunds as gently as possible in order to retain every possible guest one way or another, providing solutions such as vouchers, credit the amount for a year, free rebooking, etc.
At the same time, booking.com just decided and published on their website to simply refund 100% on all cancelation requests regardless of the Hotels defined policy and regardless of what the guest might already have agreed with the Hotel. This behavior clearly confirms that those companies neither care for their so-called “partners” nor for the destinations as this unfair business practice has hurt them even more at a time where they really needed the support the most. It is clear to see that those companies run their business model on the back and the account of the suppliers. This can easily be avoided in the future.
When #TravelTomorrow takes place within the next few months, it is high time now to make sure that destinations and their hospitality and tourism businesses do not enter the same trap again and get out of their past dependency.
It is high time for hospitality and tourism businesses and destinations to take back control of their visibility, their digital presence and reputation, their marketing communication and advertising and most importantly and foremost their distribution.
There is absolutely no need for them to again lose the direct contact to their source markets and guests, to get again dependent on foreign and market-dominating value chains where most of the tourism spend is not being contributed to the destination, its businesses, and people, where Tourism Spend leaks out of the destination and to global conglomerates having no interest in the destination and their suppliers, but only their own balance sheet and shareholder value.
The time is more than ripe for all suppliers such as Hotels, Lodges, Guesthouses, B&Bs, Activity Providers, In-Destination Tour Operators, etc. but also the Tourism Authorities and Associations in Destinations to make sure the sector is fully supported and enabled to keep more tourism spend in the destination and to take back control.
Digital Transformation is the ideal way to achieve just this. Now is the time to engage and to create and provide the local capacity, education and training, democratizing of the respective technology, etc. to enable all hospitality and tourism businesses in the destination and to take back control for sustainable tourism development, when all are starting at zero again.
The UNWTO Digital Transformation Strategy provides a great framework and platform for their member states, destinations and the hospitality and tourism industry globally.
rainmaker digital as a social enterprise and an affiliate member of the UNWTO is focusing on a positive impact through tourism and technology, has invented and deployed the VISTA Destination Network. An Open Platform and Ecosystem democratizing technology to seamlessly integrate all hospitality and tourism businesses in destinations. It was always our vision to keep more tourism spend in destinations for sustainable tourism development and to contribute to the sustainability goals.
As the largest industry in the world, tourism is everything and everything is tourism.
Only with a sustainable and healthy hospitality and tourism sector, communities, regions and its people, as well as many other industries, are positively impacted as tourism directly contributes 1 out of 10 jobs and about 10% to the GDP globally.
We believe that the time for #TourismGetsEnabled is now.
We herewith invite all destinations to enquire for our unique Public-Private-Partnership model and our freemium business model, democratizing technology. Affordable and feasible for all emerging, small, medium independent hospitality and tourism businesses to become enabled. The destination is enabled to launch a digital transformation initiative to take back control, to keep more tourism spend in the destination for sustainable tourism development.
by Thomas Müller
Founder & CEO at rainmaker digital