What is the future of technology in European hotels?
The European hospitality industry is stronger than ever. It’s one of the continent’s fastest-growing industries for employment, and hospitality investment in Europe exceeded its all-time high, increasing by almost 50 percent from 2014 to 2015. According to a 2015 report, investors in the European hospitality industry have displayed great confidence in the future of travel, tourism, and hospitality.
Europe’s tourism industry is one of the most mature and most attractive to international travelers, accounting for 51 percent of total international arrivals. The Northern and Southern/Mediterranean regions accounted for the most growth in travel arrivals. In all, Europe had a strong presence on the list of top 10 tourist destinations in the world, with five countries making the list:
- United Kingdom
With statistics revealing such strong performance, there is abundant opportunity for the European hospitality industry to capitalize on. This is not the time for complacency, though. A number of factors still pose a potential threat to this success.
There are still traditional challenges, such as costs of labor and materials or fees such as VAT and excise taxes. More stringent policies relating to border control in the wake of events such as the attacks on Paris have also caused disruptions to hospitality. In Paris, luxury hotel bookings dropped 50 percent and overall hotel bookings dropped 30 percent in the wake of the attacks, and the subsequent border closing caused long delays for travelers seeking to enter the country.
Other items have emerged on the list of challenges.
Airbnb and the sharing economy are gaining traction in Europe. The company set up a European headquarters in Dublin to pursue more strategic expansion on the continent. The largest Airbnb hub outside of the United States is actually in Paris, with 60,000 people featuring listings.
Gabriel Escarrer, Vice Chairman and CEO of Meliá Hotels International, identified Airbnb as the biggest current threat to global tourism. “It is killing Barcelona’s exemplary tourism model,” he said to a Spanish newspaper. Barcelona is currently third on the list of most visited European cities with over 7 million visitors in 2015, but Escarrer warned the city would be a “victim of its own success” if it didn’t seek to figure out a solution to the growth of Airbnb.
The popularity of Airbnb evidences a shift in the desired travel experience, as Millennials become the predominant patron demographics. Expectations of hospitality and lodging are evolving with a focus on the incorporation of technology into the travel journey. Airbnb has been incredibly successful at offering innovative, sleek mobile features that users find appealing and easy to use.
Among Millennial travelers, 56 percent consider both traditional and alternative lodging options, such as Airbnb and vacation rentals, compared to just 38 percent of travelers in older age groups. Many younger travelers are styled as “digital natives” because they grew up with nearly constant access to computer technology and the Internet. This group has been shown to expect more highly targeted, personalized marketing from hospitality brands, with 70 percent expressing a preference for an immersive, unique experience.
56% of Millennials consider both traditional and alternative lodging options, such as Airbnb and vacation rentals
The tech-hungry Millennial mindset, which has spread to other age groups older and younger, has led to the need for a different, more digital guest experience than in the past, such as complimentary Wi-Fi access and self-service tools, such as hotel in-room tablets, mobile key room entry, check-in kiosks and automated information desks. Hospitality technology in European hotels could have a huge impact on guest perception.
Another more dominant trend in the global hospitality industry with a considerable impact on Europe is the rise of mobile. Mobile travel bookings will jump to 22 percent in 2016, and guests are now coming to expect the availability of a hotel mobile app for easy access to information, services, and communication with staff.
Embracing digital innovations and increased use of technology were both identified by leading global corporation Pricewaterhouse Coopers as a top priority and one of the most impactful trends for the European hospitality industry.
Looking to the future, the European hospitality industry will continue to flourish if it can successfully adapt to new technology in European hotels as a powerful means of increasing guest satisfaction, improving guest engagement, and overcoming operational challenges such as staff and material limitations.
If you’re interested in learning more about how global hotels are leveraging hospitality technology to meet the needs of guests, contact us to schedule a demo.