When Pandora opened the jar containing all the evils of the earth, unable to resist the curiosity that consumed her, she spread them on earth, leaving hope in the container out of the reach of men. Yet it is hope, optimism and tenacity that are guiding the tourism sector through the crisis of mobility caused by the restrictions linked to the COVID pandemic 19. This period is coming to an end and, with it, a new glimmer of hope is appearing at the end of the tunnel.
At the beginning of this year, we can see that the 2020 results of the hotel industry, beyond its new characteristics, have been one of contrasts. We commented on this at length at the end of the year, and we will provide a detailed analysis in this edition of the magazine.
After the missed September 2020 rendezvous, the second quarter of 2021 should mark a technical rebound, a decompression of demand, particularly for budget hotels. The sector will probably quickly regain two thirds of its pre-crisis activity, with a summer that promises to be similar to the one experienced by the profession in 2020, and good surprises are not certainly to be excluded.
In this context of future recovery, in our cash-drained sector, everyone will have to measure the relevance of adapted pricing policies, without falling into the useless pitfall of excessive price wars. This could add pain to the past period by destabilizing the fragile equilibrium that everyone wants to regain. This precision mechanism will have to be put back into operation while preserving the healthy and necessary competition between market players.
While we can be delighted that the recovery will begin around April, we must bear in mind that it will also be marked by contrasts. Contrasts between destinations, between customer segments, or even between types and scales of properties. For the upturn in the major metropolises, it will be necessary to be more patient and look ahead to September 2021, to feel the breeze of a more dynamic activity.
"I never lose. I either win or I learn" is surely the right state of mind, as Nelson Mandela said, to draw useful lessons from the past period.
Domestic and regional clients served as a shock absorber and will surely be a lever for the recovery. The dynamics of the leisure segment showed interesting resilience. This is also the case of rural and secondary markets which, in this context, have managed to pull out of the shadows of the major metropolises, which have been the driving force behind investment over the last few years.
The sector has also become aware, more than ever before, of the interdependence between its stakeholders, which characterizes the complexity of its ecosystem. The family of hospitality has grown and more broadly encompasses the logic of exploiting an asset through the provision of a service. It calls for a rethinking of operating models with more modularity in spaces and hybridization in concepts. This is the recipe for diversifying revenue sources and customer segments within properties. It is a question of adding resilience factors to the economic performance equation that has prevailed in recent years.
The final ingredient for a recovery is the support measures for our sector put in place by European governments. Although they can be improved, they have had the merit of safeguarding a large part of the of the tourist industry’s productive toolset. France has been a good example in this domain.
From now on, an entire sector is waiting for an ambitious policy revival to make the most of this unprecedented period. Certain models, already badly adapted in 2019, will have to accelerate their mutation and restructuring. This may seem brutal, but we will inevitably experience a rapid restructuring of the supply, which generally takes place naturally over a 7-to-8-year cycle. We will deal with this point in more detail in the next edition of Hospitality ON (March-April 2021).
It remains to be seen what are Europeans’ ambitions for this industry, which is an industry of the future, even a strategic one.
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