Travel Payments

Hotels Pivot To Embrace The ‘Great Staycation Of 2020’

Hotels Pivot To Embrace Staycations

A rising tide of staycations may bring hotels back from the great pandemic slump.

While it may make sense that vacationers wary of flying and finding themselves in crowds may opt for short-term rentals through the likes of Airbnb and other homestay marketplaces, Bloomberg reports that the hotel industry itself sees an opportunity to catch a tailwind from the staycation, where travelers stay ever closer to home.

If that projected surge does indeed happen, it would be a welcome respite for, say, U.S. hotels. Consider the fact that before the pandemic hit, according to the American Hotel and Lodging Association, there were 1.1 billion guest nights on an annual basis. There’s been a bounce back, at least a bit, as early June data say that we are at a rate that will hit half that tally.

At a high level, the green shoots of recovery had been peeking through a month or so ago. As reported in Skift, Marriott CEO Arne Sorenson Monday said most of the world’s hotel markets had hit bottom and had started to rebound. Separately it will take a few years for the sector to return to 2019 levels, as noted by CBRE Senior Economic Advisor Spencer Levy.

China’s reopening, said Bloomberg, may offer at least some roadmap here. China was among the first countries to reopen over the last several weeks. And hotel occupancies are at 50 percent there, where previously they had been at 10 percent.

Beyond Airbnb

As PYMNTS noted last week, Airbnb and others have seen bookings gain ground year over year. The idea of staying somewhere like hotels where amenities are provided also seems to hold appeal.

STR, which focuses on the hospitality industry, said late last week that “drive to destinations continued to show strong weekend performance,” and noted that Myrtle Beach, South Carolina, had logged an 83.4 percent occupancy level. Overall, economy class hotels had reached a 50.3 percent occupancy level for the week.

“A few key beach submarkets have been able to grow ADR [average daily rates] by over 100 percent over the last 60 days,” according to a release.

In a survey conducted by BVA BDRC, as of early June, 68 percent of those surveyed (about 500 respondents) expect to engage in a leisure activity outside of their homes, up from 42 percent roughly a month earlier. Drilling down a bit, a quarter of respondents said they were planning to book a hotel through the next month. As many as 13 percent said they would do so within the next one to three months.

As to how they will be booking those trips, 54 percent of those surveyed said they would book their stays via online travel agencies, up more than 50 percent than had been seen before the pandemic took root. One quarter of consumers said they will travel closer to home this year, within about 250 miles from their homes. And in PYMNTS’ research, about 44 percent of consumers who are looking forward to resuming daily activities that had been in place before the pandemic want to travel domestically.

None of this is to say that would-be travelers are not worried about safety.

In the same study, BVA BDRC found that, in recording hotel guest expectations ahead of their next stay, 56 percent expect to see sanitizing hand gel or wipes throughout the hotel; 50 percent expect to see enhanced cleaning regimes; and 40 percent want to see that staff are wearing face masks.

Only about one in 10 individuals who had previously stayed at hotels stated they would wait for a vaccine before booking a new hotel stay. This implies at least some recognition that a wait for a vaccine will be a lengthy one, and that, with some safety precautions, consumers will venture out again.

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New PYMNTS Report: The CFO’s Guide To Digitizing B2B Payments – August 2020 

The CFO’s Guide To Digitizing B2B Payments, a PYMNTS and Comdata collaboration, examines how companies are updating their AP approaches to protect their cash flows, support their vendors and enable their financial departments to operate remotely.

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