The effect of the COVID-19 pandemic on the travel and hospitality business has been unprecedented. The sector is struggling with its new identity: from promising aggressive growth to batting down the hatches to simply remain afloat. Per the Mobility Market Outlook on COVID-19, the global revenue for the travel and tourism industry in 2020 is forecast at a mere $400 billion, a drop of about 42% over the previous year. What comes as no surprise is that this is nowhere close to the original 2020 forecast of $712b¹. This came in the wake of almost every government in the world announcing lockdowns, overnight travel restrictions, corporate culture switching to encouraging work-from-home, and social distancing becoming new normal. Travel or leisure was, quite literally, the last thing on anyone’s mind.

As travel-bans were enforced overnight, it resulted in near-zero revenues and majority of assets lying unutilized. Lengthy lockdowns, changes in company travel policies, consumer sentiment and unwillingness to travel, drove structural changes to demand. We saw an explosion in video conferences instead of in-person events. Travel and Hospitality executives mince no words when they speak of the last 2 quarters – it has been tough.

With the path to recovery seeming long and arduous, there is a need for a reimagination of the ways of doing business if we are to rebuild the industry.

The strategic approach to rebuilding

Innovations in technology hold the key for travel companies to redefine their role in the lives of the post-pandemic traveller. This approach will enable previously unseen levels of insight, flexibility, effectiveness, and service. There are two clear areas of focus for the industry:

• Responsive Business: Spend less, monetize assets, manage cash flow, renegotiate contracts for best possible outcomes
• Connected Traveller Experience: Use technology to re-inspire confidence in the mind of the cautious traveller

Responsive Business: Innovating with flexible contracts, monetizable assets and optimized costs

Flexible Approach to Technology Service Contracts: There has never been a greater need for digitally transforming the way the hospitality industry does business. But there has also never been a worse time to find yourself in a multi-million-dollar transformation contract. As hospitality companies hunker down to ‘keep the lights on’ with cost measures, it is prudent to think about how IT contracts can be renegotiated to a pay-per-use model to deliver on the promises without too great a financial impact. Large scale fixed-price IT contracts need to be broken down into smaller parts that offer a more realistic financial outlook. Innovation in flexible contracting will ensure that the need for transforming the experience of both employees and travellers comes to life.

Data Center Exit Strategy: When it comes to data center assets, many hospitality businesses find themselves heavily invested, both in real estate and IT systems. This renders them highly inflexible and debt-ridden, a situation made worse in the pandemic. To survive the revenue shrinkage due to the downturn in business, it is imperative to monetize these assets and infuse capital back to the company via an exit strategy. This entails selling off data center real estate and IT assets, and migrating on-premise application workloads to a public cloud environment. This should enable cash infusion into the operations, reduction in running costs, improved resiliency, continuity and agility in the IT environment, which in turn will advance the digital journey of the organization.

Creating a Safe Work Environment for the Staff: Intelligent rostering to ensure that only the bare minimum staff members are required to report, regular testing, secure data access to remote staff are some of the initiatives to consider.

Connected Traveller: Building confidence through a touchless experience

Travel behaviors have changed – and this change is here to stay. As the pandemic goes through its spikes and troughs, the post-pandemic traveller is cautious. Technology needs to be wise to the new traveller sentiment by providing relevant information that inspires confidence. 

What travellers want from technology 

• Ability to avoid queues and congestion in public spaces
• Minimize physical contact with others
• Protect financial and private data
•  Advance notifications when there is a delay
• Access to testing, reliable healthcare should the need arise 

Contact-less check-in: Customers should be able to walk from their cars to the room without needing a face-to-face interaction with any member of the hotel staff. This would call for a mobile based application that facilitates check-in by validating customer information and updating the guest records.

Mobile room key: There must be no need for a customer to pick up a key card at the reception – a mobile application must do the job. 

Touchless payments: A guest must be able to pay for services without needing to use a card machine or deal in cash.

In-app ordering: Everything from room service to business center bookings must be enabled via a mobile application that allows the customer to access the hotel’s services without needing to interact face-to-face with a member of the staff.

Touchless hotel Surfaces: Unless it is necessary, guests should not need to touch surfaces such as TVs, remote controls, AC temperature controls etc.

Room sanitization status: A robust information system should inspire confidence in the customer about the status of the room’s sanitization schedule ahead of check-in. If the customer gets a notification that the room he/she is about to stay in has been thoroughly sanitized prior to stay, it will result in a greater degree of confidence in the customer.

IoT based social distancing tracking: An application that indicates the presence of potentially infectious residents and alerts the user in case there are violations in social distancing norms would build greater confidence in customer’s mind on how seriously the hotel is taking the health risks. 

Toward a resilient future

Hospitality leaders agree that the solutions to challenges around customer confidence, employee safety and deteriorating revenue in a post-pandemic world will come from adoption of technology. The answers lie in the blending of innovation in technology solutions and bringing in new ways of working. This calls for a huge shift in the mindset toward consumers as well as business.

On one hand, the new-age hotel guest will expect remote access to front-desk and concierge services, customer services through chatbots, check-in /check-out without face-to-face interaction with a hotel employee, and enhanced hygiene standards.  On the other, it is imperative for all travel and hospitality companies to approach this transformation with an open mind and look for solutions which drive down costs while re-kindling consumer confidence and giving revenues the much-needed fillip. The players who can nimbly embrace new ways of working in a post-pandemic world will be the ones who carve out a greater share of the future.

Wipro has been helping Travel & Hospitality customers adopt the right approach to recovery and success. Connect with us to understand how we can support your organization.

References

1. https://www.statista.com/forecasts/1103426/covid-19-revenue-travel-tourism-industry-forecast