Workforce travel is an evolving landscape at the moment, to help companies get back on the road, we sat down (virtually) with Keith Watson our Global VP of Supply to get his insight on the accommodation industry and share some tips that will help companies prepare to travel again. This is the first in our "Getting Back on the Road" Series that aims to answer the questions travel managers and business travellers have.
1. How should companies prepare to introduce business travel again for their employees?
Keith Watson: After the industry got over from the immediate onslaught of cancellations, it became a case of how to manage and prepare for travelling again. Now that hotels are almost ready to re-open their doors, the question of availability is soon to be resolved.
We see that business travellers are moving their focus towards each element of the trip from search and book, pre-arrival, in-trip and post trip processes. Business travellers’ requirements and expectations have changed. With these challenges travel companies, be it booking platforms or accommodation providers have been forced to optimise the experience for their customers.
Roomex recently carried out a survey of travellers. When asked ‘What is your primary concern when staying at paid accommodation now?’ 35% said ‘Social distancing’, whilst 29% said ‘Cleanliness of the hotel’. The remaining were split across ‘Contactless payment’, ‘Room comfort’, ‘Hotel facilities’ and ‘Quality food’.
Price is not the primary concern currently. Travellers need up to date information from hotels on cleanliness and new social distancing procedures. Hotels have completely overhauled their processes and procedures providing extensive new collateral to make their customers feel confident and above all, safe. At Roomex we have introduced RoomexClean, a new feature that brings this collateral into the search and book experience.
In order to prepare your staff for travelling again it is all about pre-trip organisation, make sure each traveller has the relevant information from the hotel that they are staying in so they know what to expect on arrival. Pre-check in confirmation calls are a great service that gives travellers a lot of confidence as processes and procedures are changing so fast. Overnight this service became the most critical component of Roomex’s customer service offering, as we could confirm if the hotel was open and inform the traveller on latest meal options and hygiene measures.
2. How will pricing of accommodation change and how should travel managers devise a strategy for this?
KW: The seasonal RFP is important, but it is quite literally half of the story that corporate needs to take a close look at savings. Essentially with so little occupancy in the market demand is not driving pricing. But the high degree of uncertainty means it is hard to forecast what has happened to the pre-COVID demand patterns. Are events in the future going to happen, how will segments of demand return?
The week of 15th June in the UK, weekday occupancy amongst open hotels was at 27%. However, when you consider supply that will be quickly coming back on stream from July 4th (ie whole-market occupancy) in the UK, this drops to around 6-7%. Supply will return far faster than demand is likely to.
A fixed rate historically irons out the peaks in pricing for a company. The discount reflects their volume, but also gives assurance against paying a high demand-fueled price (blackout periods aside). If a hotel isn’t actually reaching capacity, there won’t be any peaks – nothing to yield against. But there may well be troughs to take advantage of.
Typically, any client will book a few hotels, a lot – close to their offices and client offices or projects their fulfilling. But 80-90% of all the hotels they book will be at far lower volume. This means that most of the possible savings will be in the middle and long tail of the curve. We have addressed this through Roomex Rates - fixed and dynamic rates we negotiate for all our clients to take advantage of. This help clients primarily with mid curve demand and then Roomex Saver+ for the long tail.
In the long tail, neither the clients nor Roomex have sufficient volume to negotiate a rate, so we open a broad bank of supply discounts from many sources. Potentially 45-55% of the savings are in the long tail but it’s harder to deliver than simply negotiating a rate. It involves significant API development and yielding supply sources to ensure the client always gets the best rate.
3. What will business travellers look for when selecting a hotel?
KW: It’s all about ‘Clean’, nothing else matters, for now. For travellers this is the new user-based star rating. What is more relevant the 10,000 pre COVID-19 reviews or the last 10 since March 23rd?
Social distancing measures, changes to housekeeping procedures and check-in process. This is probably the most fundamental change that will not be reversed. What 9/11 did to drive change of security procedures within global travel, COVID-19 will do to hygiene processes within domestic and global travel. The hotel stay will feel very different from that perspective, and travellers should feel reassured that hotels have stepped up to the challenge to make this enhanced level of safety their top priority.
4. Will travellers still be able to avail of Food & Beverage within the hotel?KW: Hotels have had to find a way to make some provision within their own constraints that meets government guidelines. If the hotel can offer F&B it will be either at a reduced level of room service or a very basic ‘knock and drop’ or ‘breakfast in a bag’ option.
As we approach July there are also hotels offering spaced dining facilities as a step to getting back to greater normality. This works reasonably well, but the key is that the booker and traveller know what to expect so part of the challenge has been to present that information accurately at time of booking.
Some chains such as Travelodge have teamed up with Deliveroo and Just Eat to make takeaway options easier. We foresee that these partnerships will be a key driver for success within the travel sector going forward.
Avoiding out of pocket expenses for travellers such as meals, but also fuel and parking, is now a key concern for employers, especially as food options within the hotel may be reduced for a time. We have seen an uptick in interest of our pre-paid RoomexPay expense card as a result of this. The most important advice is to check all details with the hotel (or your Roomex Account Manager) before your trip.
Learn more about Roomex and their initiatives with their hotel partners to keep those travelling during COVID-19 safe by getting in touch with them here.
June 30, 2020
