The hospitality industry always bounces back from recessions and times of hardship. Always. The COVID-19 pandemic will be no different.
But what is your post-COVID business strategy? Are you ready to welcome people back as the vaccine proliferates, restrictions ease and confidence returns?
More importantly, are you aware of the countless new opportunities that have arisen from what has unquestionably been an incredibly challenging, stressful year for everyone?
The future is bright. So, let’s consider what’s likely to be different in hospitality and where the opportunities lie.
However, before we get to the strategies you should be concentrating on for 2021, let’s put the challenge into context and get you fired up to come out of the other side fighting, growing and prospering!
The impact of COVID-19 so far on hospitality
The coronavirus pandemic has cut through the heart of the hospitality industry. In a sector which contains 20,000 small businesses in the UK alone and which employee around 3.2 million people, the impact of COVID-19 on hospitality has touched nearly everyone’s lives.
But just think about how much you really want to go to a nice restaurant, or how the calling of the pub or your favourite bar is getting louder by the day. This industry is far from on its knees - even if it might feel that way - and that’s because people want it back, desperately.
There are some COVID-19 hotel stats which reveal the challenge ahead, though:
- occupancy in central and South America has fallen by nearly 53% year-on year
- hotels in Europe have suffered a 58% dip in occupancy
- RevPAR in Asia and the Pacific is down 41%
That’s just related to the hotel industry, but it demonstrates the work that’s needed during 2021 to get this sector back on its feet. In fact, experts are suggesting that it’ll take up to four years for the UK hotel industry to recover.
So, what about the other big player in hospitality?
The impact of COVID-19 on restaurants
One of the most common points of reference for the impact of COVID-19 on the economy is the restaurant industry.
We’ll spare you any more horrible percentages and stats and instead consider some of the key long-term effects the restaurant industry might experience following the pandemic.
On-premise vs off-premise dining will remain pivotal: there are countless restaurateurs who never thought they’d add delivery services to their business plan, but the likelihood is that they’ll have to keep them going in order to remain profitable and capable of growth.
Family-owned restaurants will need to differentiate themselves: many experts are clear on one thing: small, independent restaurants have had the hardest time surviving against the COVID-19 backdrop. Against the big chain competition, they have smaller pockets and less contingency, and that’s why differentiation will need to be at the top of their list from 2021 onwards.
Re-engineering of menus: shareable options may become a thing of the past for some markets, and the rise of family meal boxes for takeout are another signal that menus need to be rethought and re-engineered.
Goodbye communal tables: social distancing rules will remain in place for a while to come in most countries, but even after they’re lifted, communal tables may become a thing of the past, which will call for a rearrangement of seating and the layout in many venues.
Zero-contact technology will prevail: from contactless payment methods to automated check-in and chatbots, technology which minimises human contact will continue to prevail.
If you think the above paints a rather depressing picture of the future, think again. This time will pass, and even with the inevitable changes that’ll take place, there are opportunities abound to thrive if you’re a hospitality business operating in a post-COVID world.
6 Post-COVID business strategies for hospitality businesses
If you’ve got a bit of extra time on your hands, now is the perfect time to dive into each of the strategies below.
Still busy? Make sure you create time for these strategies, because they’ll be incredibly important during 2021 and beyond.
1. Renegotiate with suppliers
Your suppliers have had a tough year too, and it’s likely you’ve had some difficult and emotional conversations with them already. But if you’re still in touch and have vowed to stick by one another’s side, it’s time to take that one step further.
Start talking to your suppliers. Ask what they’re planning for 2021; what pricing structures are likely to be in place in the future? Is there any way you can get a better deal without them losing out?
Make it clear from the outset that you want to help them as much as you need help. A lower price for a longer commitment is one example of a reciprocal back scratch that just might work.
2. Dig deep into consumer trends
Your customers are probably already behaving in a completely different manner to what you’re used to.
Changes in customer behaviour happen all the time, but 2020 has accelerated a lot of these changes, and the key to success lies in monitoring them and adjusting your offering to capitalise on what they now want, expect and like.
For instance, are you ready to serve those who want a completely unique experience? And what about the people who would rather experience the best your menu has to offer from the comfort of their couch?
Here are just some of the 2021 consumer trends that will matter to you:
- at home experiences
- new booking trends
- clean dining
- remote working environments
- cloud/dark kitchens
Find out more, below.
3. Estimate the impact on supply
Research suggests that over 80% of consumers want to support their local community.
One of the key ways they intend to do this is to buy local. They’re looking for businesses on their doorstep which offer value and whom they can support. If you’re a restaurant - or even a hotel - you’re perfectly primed to give them just that.
This concept will likely change your view of supply and demand in 2021. It’s time to consider where your next customer might come from and just how many local customers you can tempt through your doors.
4. Investigate operating further afield
You may never have thought about a delivery or eCommerce arm for your business, but if 2020 has taught us one thing, it’s that there are plenty of opportunities beyond your immediate patch.
Start thinking about how you can spread your brand further afield. For instance, could you offer meal kits, hampers, or delivery options? If you run a hotel, why can’t you offer some form of online store to sell branded gifts?
Think outside the normal remit of your business and there will be plenty of opportunities further afield.
5. Find the latent value within your customers
It’s there - you just need to squeeze it out.
For instance, did you know you can use WiFi marketing to track customer behaviour and then market to them based on what they do? All you need is the right metrics to hand and you’ll find countless latent revenue opportunities within your existing customer base.
Their return rate, the number of new versus returning customers and engagement rate are just some examples of data that will take you far beyond demographics and into much more targeted marketing.
6. Maximise reviews - don’t fear them
Online reviews will play an even more important role from here on. Customer opinion drives purchasing and booking decisions, which means you need to be on top of your online reputation.
Bad reviews are never nice, but even that type of feedback presents opportunities if you manage it effectively. And did you know you can increase TripAdvisor reviews with your guest WiFi?
Make it a promise that you’ll spend a considerable amount of time every week reviewing, responding to and making copious notes about reviews. What are your customers telling you? How can you take that feedback and turn it into a better business?
Before you go, our checklist for reopening after COVID-19 will help you plan, strategize and ensure you create a warm, welcoming environment your customers will trust and love.
Don’t plan a moment further without it!