The hotel and tourism industry is monitoring very closely the evolution of the epidemic throughout the world. As it is experiencing major cancellations and losses, many companies are setting up plans to adapt to the situation. Hospitality ON takes an overall look at those measures throughout the whole industry.
The World Health Organization (WHO) declared on March 11 the COVID-19 a pandemic, pointing to the over 118,000 cases in over 110 countries around the globe. Previously, the UNWTO called on countries and industry leaders to take the appropriate measures as it is a “fundamental people-to-people nature of the sector”, but to avoid tourism and travel restrictions.
However, countries such as the United States, Lebanon or even Israel have imposed strict restrictions on travellers from several countries such as Italy, France or Germany. In other cases, travellers from these countries were put in quarantine for 14 days upon arrival, as is the case for Russia, China, Malta or Cyprus.
In response to these measures, and to the evolution of the outbreak, numbers of airlines cancelled some or all their flights from or to the concerning countries; several of them also offered free cancellation or no fees to rebook the flights, just like Cathay Pacific, Air France, British Airways, Aeroflot, Qatar Airways, Korean Air, Air Austral and others. Some airlines mad it, on the contrary, harder to get a refund, for instance United Airlines.
This is also the case for many of the hotel companies. Indeed, hotel groups like Marriott, Hilton or Accor are waiving individual cancellation fees for hotel stays in Greater China through the end of March. The French hotel group Logis Hotels even said it will no longer take commission on bookings as the outbreak is raging throughout Europe now.
Also, the first feedback from our survey revealed: half of the companies that responded have set up a plan to adapt their activities. The measures can be from human resources to working procedures, changes in working/opening hours, training of personnel or marketing and/or communication. Further analysis will come in the next days.
Even the cruise industry is going through rough time, with cancelations and fear of the Princess Cruises episode, when two ships became hotspots of the for the spread of the coronavirus. Since then, the company announced the cancellation of all cruises for the next two months. Others choose the way of flexible policy booking, as for PONANT. The French company offers special booking options, like the option to pay a deposit of only 10% of the total price as well as the possibility to cancel without fees up to 30 days before departure.
Indeed, march is usually a booking period for the summer holidays, as Choice Hotels International, Inc. reminds us. The American company is offering customers “a new promotion, just in time for peak travel-planning season”. People booking for more five consecutive nights or more will get extra loyalty points, 13,000 Choice Privileges points to be precised, which can be converted into free nights in the hotels of the groups.
These marketing measures are coming after hotel groups, airlines or travel agencies have seen a drop in the number of bookings, due to the uncertainty of the next months concerning the epidemic. Even Google sees a drop in queries for Holidays as Ruairidh Roberts, senior industry head at Google, said, especially since February 22:
“February twenty second was the day that queries changed,” he said. “For every single travel category there has been a drop off in demand.” He also said that “Holidays was the starkest followed by hotels, there was a little up-rise in air but that was most likely to be people checking if they flight was cancelled. Not queries you want to monetise.”
Italy has seen the biggest drop. But Ruairidh Roberts also said that “there’s not massive panic, but there was a reaction,” referring to the fact that Google data shows a drop since the announcement of the infection in northern Italy, or even more the confinement of the whole country. He also said that businesses needed to be more reactive online, especially with data mining or internet referencing.
As a remainder, the last major outbreak, the SARS in 2003, affected the industry, but which also took a major hit from the Gulf war and the internet bubble. Today, we are in a much more politically and economically stable world. On the other hand, European hoteliers are very dependent on domestic clientele. Only time will stand still, and we will have to wait to see for an improvement.