Global travel trends 2020: the drivers of change in the hospitality industry

Global travel trends 2020: the drivers of change in the hospitality industry 2560 1707 HotelREZ

It’s almost 2020, and as we prepare to enter not just a new year but a new decade as well, it’s important to take a step back and analyse how current world affairs will affect the travel industry going forward. This year has seen many global changes: from an increase in environmental activism and extreme weather events (think extinction rebellion and the Japan Typhoon) to political uncertainties leading to volatility in the global economy (such as Brexit weakening the British Pound).

Whether it’s through changing tourist figures or fluctuating room prices, geopolitical shifts and economic trends end up affecting the travel and hospitality industry in the long term in one way or another. And as these changes will likely impact hotel management strategies, staying on top of key hospitality trends is crucial. 

So without further ado, here are the top 2020 global travel trends we expect to see next year. 

What will the tourism industry be like in 2020?

  • Innovative technology will shape guest experiences

From virtual reality to artificial intelligence, technology is innovating at a faster speed than ever before. And to stand out in the competitive hotel industry, hoteliers are shifting to focus more and more on providing an outstanding guest experience by incorporating technology. Using in-room technology can make a guest’s stay both more convenient and enjoyable. 

Take voice technology, for example. The average human can type 40 words per minute, but speak 150 words during the same amount of time. So by 2020, over 50% of all online searches are expected to be done by voice-enabled technology. But it’s not just how bookers search for hotels that is changing: a total of 79% of hoteliers have plans to invest in voice technology in the hotel itself. Hotel brands are finding new ways to use smart speakers and voice assistants (such as Alexa or Google Home) to engage guests and drive additional revenue. For example, when guests order room service through voice assistants, the technology can be customised to drive higher margin sales by recommending certain dishes.

Innovative technology can also help a hotel become more eco friendly, bringing it in line with sustainability trends and ensuring it is making a positive environmental impact. Through the implementation of IoT (Internet of Things), a hotel can improve measurement of both energy utilisation and efficiency throughout the building. This can, in turn, help them understand where they stand in terms of industry benchmarks, and drive them towards reaching higher standards. 

  • Showing up on Google will become more costly than ever before

While online travel agents (OTA’s) are currently receiving around 51% of bookings, direct bookings are predicted to grow to a 50% share by 2022. But let’s forget the debate on who will dominate the booking market next year. At the end of the day, and regardless of who has a higher market share, Google is the true winner.

Owning at least three-quarters of the market, Google dominates online search. Considering that 96% of leisure travellers start their hotel planning with an online search, the online travel industry is one of Google’s biggest customers when it comes to advertising. Together with Facebook, Google owns 71% of all online advertising revenue, and the amount that OTA’s like pay for search marketing is in the billions of US$. 

Recent months have seen Google getting more aggressive with its tactics by pushing down free search engine listings to make room for even more paid ads. What’s more, Google now gives customers the ability to book trips directly through them as well. This means that OTAs (and hotel brands that can afford to compete) must now pay even more to show up higher in search results. 

The company has been a rising risk for the travel industry for a while now, making it even more difficult for independent hotels to appear in online searches. As a result, hoteliers will continue to look elsewhere for effective distribution.

And while it’s not a new concept, we predict that the Global Distribution System (GDS) will continue to see YOY growth by as much as 5% to 10% worldwide. Here’s why the GDS is still as important as ever for hoteliers.

  • Travellers will be even more digitally savvy

Millennials and digital nomads continue to change the way in which people travel, which has led to the successes of companies like AirBnB and Uber. The digital maturity of travellers is impacting the hospitality sector and will continue to do so over the next few years. To remain competitive, hotels need to adapt.

As it stands, up to 80% of last-minute bookings are made on a mobile device, and people are now five times more likely to leave a website if it isn’t mobile friendly. Mobile bookings grew by 1700% in just four years and 2020 will see this trend grow even further. What’s even more interesting is that mobile apps convert 5 times more than a mobile browser, making it likely that 2020 will be the year for more independent hotels to release their own apps. Have a read of how to make your hotel website more mobile friendly to learn more. 

Reviews will be ever more important in the new year as well. Currently, 65% of consumers check online reviews before booking a hotel. A recent Tripadvisor study found that 79% of users are more likely to book a hotel with a higher rating when choosing between two otherwise identical properties, and over 52% agree that they would never book a hotel with no reviews. And this doesn’t just stand for online booking sites: reviews on social media platforms are just as important. Hotels can embrace this trend by integrating review management into their marketing strategy going forward. 

  • The Chinese outbound tourism market will experience a momentous growth spurt

The Chinese outbound tourism market, which makes up almost a quarter of global tourism spend, is expected to grow at an even faster rate. Thanks to rising Chinese incomes and more open visa policies, experts predict that Chinese tourists will take 160 million outbound trips by 2020.

Hoteliers should see this as an extremely positive trend as on average, Chinese tourists tend to spend more when travelling. The top 10% of Chinese travellers spend an average of US$ 2,225 per day, and according to guests surveyed in a McKinsey study, 34% choose fine dining as the most important factor when deciding where to travel to. There’s also some good news for independent hotels. We’re seeing an increasing trend of Chinese tourists preferring to stay at authentic, independent hotels to experience local customs.

Hoteliers keen on attracting more Chinese tourists should ensure their website is translated into Chinese, and that they are being promoted on Chinese social networks, such as Weibo. For more information on how to market to Chinese travellers, have a read of the importance of the Chinese outbound tourism market.

  • Hotels targeting niche markets will see greatest success

The internet is increasingly becoming more crowded, and this will be no different in 2020. Entrepreneurial hoteliers implementing a niche marketing strategy will see the greatest success at attracting new guests next year.

A niche marketing strategy focuses on targeting one particular section of the market that has a specific set of needs, such as on guest preferences and hobbies, to offer the ultimate travel experience. Hotel owners find that marketing to a niche audience is more cost-effective and brings in larger margins. It also means they have less competition to worry about and can enjoy more brand loyalty as these markets are often under-served.

To provide an example, an excellent niche market to get into in 2020 is the pet-friendly hotel market. Pet owners see their furry friends as irreplaceable members of their families, and pet industry spending reached an all-time high of US$ 72.56 billion last year. More and more hotels are now offering pet-friendly stays, often including water bowls, outdoor play areas and even doggie room-service to please their guests. 

If you’re keen to enter the pet-friendly hotel market in 2020, have a look at our pet-friendly rate criteria and register your interest. To learn more about niche opportunities, read ‘increase your hotel’s visibility through niche markets.’

Welcome 2020 by implementing top travel trends

At HotelREZ, we work with more than 1,500 hotels in over 100 countries to ensure they are growing their business in line with key industry trends. By providing quality distribution, representation, marketing and consultancy services, we help our members receive more bookings and increase revenue year on year.

Find out more about our services or get in touch today to discuss how your hotel can profit from the 2020 global travel trends. 

About HotelREZ 

HotelREZ Hotels & Resorts was founded in 2004 by Mark Lewis, an experienced hospitality industry professional and entrepreneur. Over the course of over a decade, the company has grown to be one of the leading hotel representation companies dedicated to marketing and connecting independent properties with bookers worldwide. HotelREZ now provides distribution, revenue, sales consultancy and marketing services and support to more than 1,500 hotels, apartments and hotel groups in over 100 countries including private label GDS chain code solutions. HotelREZ Hotels & Resorts is a SAAS company. 

HotelREZ manages the brand Best Loved Hotels, a collection of unique global individual properties, with a dedicated GDS Programme, together with a Website and printed Directory, aimed at the high-end leisure agency and traveller. HotelREZ also incorporates the global World Rainbow hotels, the world’s only GDS enabled LGBT global hotel consortia representing some 1200 hotels in 230 destinations across the globe.