hotels in US, contactless online bookings, multiple payment methods

Omicron Impact: The Effect Of The Global Hospitality Industry Is Trivial!

During the previous two years, the global travel and tourism sectors have gone through a lot of challenges wherein small to large scale travel companies also have not witnessed any growth in the market. However, travel companies right now have developed themselves to be flexible and gained the ability to absorb the sudden blow that the new coronavirus waves, and their variants, previously Delta and now the Omicron, are causing.

The hotel and travel industry has occupied the last two years in preparing themselves to face the possibilities like Omicron. With an abundance of global understanding happening around, we need to be constantly observant but operational. From initially being a hands-on sector completely until 2019, currently, the new normal of travel has changed technology-driven and contactless.

Technology advancements are very much embraced by the hotel industry wholeheartedly. With technology developments from contactless online bookings, cloud-based management systems, smart-phone applications for guests to book services, order meals, make online payments through multiple payment methods, etc., hotels are well adapted to deliver a smooth, safe and comfortable stay experience for customers. 

The replay of the Delta variant caused anxieties that were absolutely accelerated at the time when the new variant Omicron was initially discovered. Now the anxiety is revolving around the concern on how this new coronavirus variant affects the global hospitality industry. 

The primary full week of hotel data obtained since the time the Omicron variant was identified does not demonstrate any indications of new strain attacked performance. According to STR (Smith Travel Research) report, the United States’ recent metric for revenue per available room, the hospitality industry’s main performance was roughly about 9% down the 2019 levels. In Europe, it was 14% down and displayed a 36% decrease in China.

None of these reports are sharp changes from the previous month’s performance. Even though the new variant is more contagious, milder than the earlier Delta variant, there could never be a massive impact considering the swelling Omicron cases. 

While experts analyzed that due to travel restrictions and government policies, it was possible to find some industry performance reactions in China and Europe. In contrast, U.S. hotels most interestingly bear any unpredicted development that would normally stay the way in the recovery of the pandemic.

The hotels in the United States marked a significant week-to-week swing as the previous week included the Thanksgiving holiday, which covers around 20% of 2019 levels. But the reduction in the previous week was accredited more to seasonality than the pandemic fears. It is always considered that December and January’s months are some of the slow seasons for hotel businesses.

However, some of the winners this week are the more affordable hotel segments in the U.S. that continued to look out with higher numbers than the 2019 last week, whereas the expensive hotel segments went down in performance.

Truist Securities about the U.S. performance reported, “The initial days of December are considered the low season for all kinds of travel, and it’s not a surprise to witness great gaps between the performance of different travel services.”

The global travel industry was preparing for a possible impact during the detection of the new variant earlier last month, and there still seems to be a dent in the airline’s recovery. Due to the strict travel restrictions, international travel puts a drag that was about to bounce back to life. 

Outside the U.S countries, hotel performance seems to record some impact as countries like Germany and Austria have initiated lockdowns for unvaccinated people. However, it is still believed by Truist that the European data was indecisive concerning the consideration of the new variant among the potential hotel guests.

The weak hotel performance data was also carried out by China, but that is a continuation of the strict travel restrictions from the ongoing strategy of the country for zero-cases during the pandemic. Freitag stated, “Many things of this are sort of played into the Delta variant, and currently the new variant, Omicron is the headline. Most of the decisions were made pre-Omicron itself.”

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