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Megatrends and the hotel industry.

Now they have arrived, the 1920s. It remains to be seen whether they will go wild like in the past century; and investors would be only too happy to take a look into the future in order to make proof decisions. But the future remains uncertain.

This also applies to investments in hotel real estate. However, there are five megatrends that already today have a direct, indirect and interconnected impact on the design and success of hotels: digitization, individualization, environmental awareness, health and globalization. Since the industry is exposed to fierce competition like hardly any other, adaptations and innovations for social change play a crucial role for success. Take a look into the glass ball with our two-part article!

Direct and indirect consequences of digitization.

The internet, most recently driven by mobile devices, has changed our society significantly. The immediate availability of targeted and current information only needs access to the World Wide Web. With this development, for example, new market players such as booking platforms have emerged, which have replaced the classic travel agency. The direct and indirect effects are also becoming increasingly apparent. Free WIFI access is standard. And individual apps take on the function of a digital concierge. Hotels themselves use digital booking and payment systems. In addition to this increase in efficiency, completely new business models and markets also emerged, as the example of AirBnB shows. But this online mediation in private accommodation, which was initially perceived only as competition for hotels, is now also used by hotels themselves as a marketing tool. Above all, however, this special accommodation and accommodation variant aroused the guests' wish for very individual furnishing and design concepts.

The high dependence on search engines, whose algorithms determine visibility, put hotel managers under pressure. They are now using social networks to establish and maintain direct contact with the guest. At this point, too, individualization and digitization meet: The uniqueness of the hotel leads to a high quality of experience, which is then shared again in social media in the form of selfies or other images. As a result, the guest is increasingly and happily instrumented as the hotel's brand ambassador. He is no longer just a consumer of services, but becomes part of the marketing machine. The hotel group 25hours has been able to celebrate such great success with such individual furnishing and equipment concepts in the past 10 years that the company has grown to eleven hotels and will open two new hotels in 2020. But also established hotel chains, such as Accor with the "Mama Shelter" concept, jump on this train and thus combine the character of a hostel with sophisticated guest requirements.

The mobile internet has yet another, very decisive effect: it creates a completely new type of person with the “digital nomad”. Whether creatives, lawyers, programmers, consultants, employees in the media industry or managers - relying only on an internet connection, these "brain workers" can basically live and work anywhere. The largely location-independent way of working and living still needs accommodation, workplaces and meeting places that fit the agile lifestyle. Work and leisure merge. All the more important is the work-life balance and a perfectly equipped, stimulating and comfortably furnished environment, uncomplicated bookable and flexible time options as well as adequate services.

For example, a correspondingly innovative concept was successfully implemented by the company Zoku Amsterdam B.V in the Netherlands. Similar mixed forms of apartment and hotel or office and hotel offer full-serviced apartments, e.g. for temporary managers. Ruby Hotels focuses on hotels with temporary offices and The Student Hotel takes the idea of ​​a student dormitory to a new future. The concept of conscious "quality time" as a balance to work is becoming more and more popular for young population groups, but also with progressive baby boomers. The results are more and more short vacations in the form of city trips, from which AirBnB does not benefit alone.

Optimism in the Far East

With globalization, in addition to the freely disposable income, the desire to travel in Asian countries such as China, India, Taiwan or South Korea has increased. Anyone who has recently walked through the old town of Salzburg and knows the situation at the turn of the millennium as a comparison knows what we talk about. But Italians and Spanish people too seem to have caught the travel bug. Almost all cities that are reasonably interesting for tourism and selected “tourist traps” (such the Neuschwanstein castle) in Central Europe are familiar with this phenomenon. Mostly the travelers spend the night in the cities, often traveling by bus and train; if one can afford it, also by rental car. The inspiring flood of images on the internet also plays an important role in this new discovery of Europe. The smartphones whipped out for selfies for always the same view photos speak a clear language.

In addition to the new flow of tourists, business travelers in the cities require additional hotel beds. There are currently over 1,300 new hotels with 162,000 beds in Europe under construction; more than 25% of them in Germany, most of them in cities. In 2020 alone, 19 new hotels will open in Vienna only. Apart from special events such as trade fairs, city hotels are busy throughout the year. Provided they have found “their” niche.

The individualization on the guest side finds its counterpart in new market segments. There are now so many of them that you can hardly keep up with the names for them: from hostels to boutique, budget and theme hotels to modern or classic luxury hostels, everyone can find their target group. The rating with stars is no longer of importance. Because appealing design doesn't have to be expensive. For example, Motel One has "invented" a completely new market in the low-price segment, which the Radisson Group is now successfully occupying with "Prizeotel". Similar to the furniture manufacturer IKEA, both rely on attractive design at a discount price.

Rather rare are the so-called theme hotels, which make a certain topic conceptually tangible. The new family hotel Pier Drei in Hamburg's HafenCity is such a theme hotel. Creatively equipped with three campers, a "racker room" and other unusual facilities, it was designed by the founders of the “Miniatur Wunderland”, the largest model railroad system in the world. 

In our second part, which will follow in three weeks, we show how the holiday hotel industry will change in the future due to megatrends.