A few years ago the hotel industry in the world took an upward course. Spanish and American chains began to further expand their borders and build establishments in regions where tourism was not as strong.
by: Ana María Restrepo
With the passage of the months Asia, Latin America and Africa gained ground, but the United States, Spain, Mexico and as such the ancient continent, continued with their good run of tourism. 2007 was presented as the starting year of a new future, however the US economic crisis changed the landscape in such a way that low employment levels were reflected in 2008 and 2009.
2010 gave a light to the industry and business and leisure travel which were reduced in 2009, but already resumed their course, not as strong as before, but they did show a slight recovery in the industry.
Today, when we are beginning the third five years of the XXI century, the hotel industry has presented a turnaround that puts in check more than one establishment, chains and hotel groups.
Actions in the face of the crisis
At the beginning of 2009, Amadeus, provider of the Global Distribution System, conducted a study called "The Austere Traveler: Impact of Business Cost Cuts on Hotels"
This analysis showed that all 354 executives interviewed travel for business at least once in the quarter, 131 travel once a month (37%) and 25 (7%) travel weekly.
This large number of travelers who require the satisfaction of certain needs, raised in the study a change of acuation and mentality that hotels should and should continue to implement when it comes to attracting this type of public while the economic crisis does not show a total recovery.
Luxury became a secondary or tertiary factor when choosing a hotel. For an executive it is much more important to obtain the basic services for the development of their activities such as: Wifi access from their room preferably, simple check in and a quiet room.
The price has also become an aspect that stands out at the time of staying in an establishment due to the least money given by the companies for expenses. For travelers it is important to stay in hotels worthy of trust, although of lower category, with uniform levels in all their establishments and high quality standards, as juan Ramón Acosta, director of the Hotel Association of Colombia, Cotelco, Antioquia-Chocó chapter, also affirms.
The paradigm that is presented in the hotel industry is governed by quality and good service, as well as by efficiency and quick problem solving rather than luxury, although the importance of comfort is never left aside.
Other perspectives
Although the economic crisis did not hit Latin America and the Caribbean as hard, many establishments and destinations showed decreases in key industry measures such as ADR (average daily rate), RevPAR (revenue per available room) and occupancy. But this was not a reason to give up, on the contrary many chains came to Latin America with the expectation of creating new accommodations that will be operating in the next three or four years.
It should be noted that although the crisis is already showing some signs of improvement, business and leisure travelers continue with a lower travel budget, but with more needs, so budget hotels must not only compete with price but also with different services.
Security is also a key factor for any tourist, as mentioned by Acosta, who explains that the high hotel offer that occurs in the region, accompanied by that of establishments without qualified registration, can cause insecurity to increase due to the high number of travelers who can reach an establishment. "This example was experienced in Africa with the World Cup, many tourists were victims of unscrupulous people who took advantage of the situation and the poor security of the accommodations."
Alongside these approaches is also the customer experience, globalisation and the handling of technology as the new normal for hotels, as proposed by another Amadeus study, presented in mid-2010, Invent the future: the new normal for hotels in 2010 and beyond.
Doing more with less, guaranteeing growth and competitive differentiation will be the items by which hoteliers must be guided to face the changes that will occur in the industry starting from the crisis, but continuing due to architectural, ecological changes and above all due to climate change.
Regarding these challenges, Juan Ramón affirms that improving profitability, reaching the occupancy averages established by the industry and improving safety are also part of the challenges faced by hoteliers, as does Jérôme Destors, director, Hotel IT at Amadeus.
The latter also ensures that the implementation of technology must improve and be in accordance with the business strategy and capitalization of brands around the world.
Higher occupancy
In 2010 occupancy grew dramatically in many countries, as stated by Jan Freitag, global vice president of development at Smith Travel Research, STR.
According to the report presented by this company, during November 2010 there was an increase in occupancy in Latin America when compared to the same month of 2009. The market that had the most increase was Chile with 83.8 compared to 78.2% in 2009, followed by Uruguay with 82.8% with a growth of 7.9% from 74.9% in 2009. Peru ranks third with 76.5% compared to 69.0% in 2009, followed by Brazil with 76.0 compared to 68.8%, Ecuador was in fifth place with an occupation of 73.4 compared to the 2009 figure of 65.7. Argentina, Venezuela, Colombia and Mexico also showed increases.
New paradigm
The changes given by the financial situation, as well as the new technological alternatives that allow globalization show a sector that will never return to what it was ten years ago. "Hotels need to rethink their structure, improve the quality of service delivery and achieve the certification of establishments mainly in environmental matters can contribute to differentiation in the industry," says Acosta.
For his part, Jan believes that the most important challenge hoteliers have is to maintain pricing and provide their guests with a good relationship without compromising their rates.
After 2010 hoteliers will have to reinvent their businesses, open up even more to technology and above all be very clear about the expectations of customers in front of establishments since every day they receive more information about plans, promotions, accommodations, which allow them to have more for less, or get what they want easily.
Globalization and the opening of borders have also caused the conception of industry to change. Large chains and hotel groups have reached countries that before they could not have arrived and Latin America is proof of this, Brazil, Argentina, Ecuador, Peré and Colombia have potentiated their tourism and business strategies, every day there is better infrastructure and better establishments as proposed by Juan Ramón Acosta.
Hotel investments continue in Mexico, Peru, the Caribbean, Argentina, Colombia, Chile and Panama.
Paraphrasing the report presented by HOTEL MANAGEMENT in the last edition of 2010, Encouraging Latin American panorama, it should be noted that there are many tourists who decide to visit the region every year. In 2010 Brazil topped the list in number of tourists, the second place was obtained by Argentina and then Chile. The largest income from international tourism is for Brazil, followed by Argentina, Peru, Colombia and Chile.
The studies carried out by STR suggest a slow growth of the industry that sometimes decreases, but as Jan Freitag mentions: "we believe that the hotel industry will continue to proliferate and grow and that international travelers will return to different destinations. Predicting a scenario for the next 10 years is almost impossible, but I think the sector in each country will recover, although that depends on each nation and its economic cycle, Brazil, for example, will do well especially for the Olympic Games in 2016 and the World Cup in 2014, "he concluded.
