While the coronavirus (COVID-19) pandemic had an adverse impact on lodging demand across all segments of the accommodation industry, from hotels to peer-to-peer platforms like Airbnb, the severity varied dependent on accommodation type. Local regulations, the need for social distancing, and forced business closures all played their part in varying the impact on lodging businesses. Despite some fairing better than others, most accommodation businesses had to adapt to the changes the pandemic brought along. Some of these adaptations included accelerated digitalization, higher hygiene standards, and increased focus on domestic travel or “staycations”.
These days, larger trends that were already reshaping the accommodation industry prior to the heath crisis have been further cemented. These include digitalization, sustainability, and the demand for authentic, personalized experiences.
Globalization, the rise of the online market, and increasing ease of mobility means tourism has grown exponentially over the past decade. It therefore comes as no surprise that this has also caused growth in the accommodation industry. This is particularly the case in its largest sector, the hotel and resort industry, which has seen a steady upward curve in its market size during this time. The largest decline in size was seen during the coronavirus pandemic.
With home-sharing, or peer-to-peer, services becoming ever more popular with consumers, more traditional modes of accommodation are facing increasing competition. The sharing economy offers consumers the ability not only to stay in people’s homes, but also to make money by sharing their own homes. Competitive prices and lodging ranging from basic to luxury mean that other segments like hotels, hostels, bed and breakfasts, and even campgrounds will need to rethink their business outlook.
There has been a growing awareness for social and environmental responsibility among travelers in recent years. Lodgers are more aware of issues such as the global rise in greenhouse gas emissions, overcrowding, and a loss of socio-cultural authenticity in host communities, and want to avoid exacerbating these problems. This has resulted in more travelers attempting to book sustainable accommodation.
When it comes to accommodation industry leaders, hotel companies take the top spots. Chains such as Marriott International, Hilton Worldwide, and the Wyndham Hotel Group dominate in terms of revenue, units, and brand value. Meanwhile, Airbnb is currently the leader in the home-sharing market, with its revenue and bookings rising steadily up until the coronavirus outbreak.
The accommodation industry is part of the wider hospitality industry. In its broadest definition, it encompasses many different sectors that offer overnight lodging services. These sectors include hotels, hostels, short-term rentals, holiday homes, RV parks and camping services, and more. There are also other industries working in conjunction with the accommodation industry, for example, food and drink services, and wellness and spas. These individual sectors are subject to different trends - one example that is relevant to all of them is the rise of digitization and the online market. Trend topics can also be more specific, contactless service in the hotel industry being one. These emerging trends are sure to shape the industry's outlook, and the long-term impact of the coronavirus is expected to change the face of the accommodation industry for years to come.