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3 Biggest Challenges Facing Hoteliers’ Revenue

We’re in the age of disruption. We’re constantly experiencing new tech based solutions within the travel industry. Here are the top 3 challenges impacting the hotelier’s revenue.

Value-conscious travellers are on the rise, and their expectations have changed

Travellers are becoming much more frugal in their spending, and to some extent, business travellers as well. Many travellers want the basics and all the necessities i.e. ‘affordable luxury.’ They want a room that offers their essential needs, fast Wi-Fi, and somewhere to charge their devices. They don’t need a full minibar and other luxuries like day spas or numerous food and beverage options.

Popularity of alternative accommodation continues to grow

The hotel industry is facing competition from the increase in alternative and innovative accommodation types.

  • Increase in short-stay and extended-stay accommodations like capsule hotels and accommodation provided by CouchSurfing, Sonder and Stay Alfred.
  • Disruptive models like Airbnb are expanding their influence (while in countries like South Africa may be challenged by regulations)
  • Traditional hotel inventory is growing e.g., Accor and Marriott are increasing their presence across the continent
Hotel revenue streams function as individual business units

Each revenue source is treated as a singular business unit with very little data sharing across services (e.g. parking, food and beverage, spa, fitness center, etc.). This means, teams can’t use existing insights, cross-sell, up-sell, and personalize offers effectively. For example, food and beverage teams can forecast better with a real-time link to the rooms forecast. This impacts forecast accuracy and operational inefficiency which in turn impacts the bottom line.

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Miriro Matema
the authorMiriro Matema
Born in Zimbabwe and living in South Africa, Miriro is a seasoned publishing editor and writer, having worked with leading brands in investment, business leadership and entrepreneurship. Passionate about Africa’s development, Miriro is also a dynamic marketing consultant with 10 years experience working with startups and large multinational corporations. With a heart for travel, Miriro spends her time discovering the nooks of crannies of Africa’s hidden gems, taking the roads less travelled, meeting the beautiful people that call Africa home while exploring their food and culture. Miriro is currently a writer with Byolife Travel and Gallivant Africa

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