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Crisis or no crisis, that is the question.
Week 9 - Airbnb the new giant in town, crisis or no crisis (still under debate), COVID vs evolutionary psychology (psychology won)
1. Main Hospitality News
Core news related to the industry
The transaction market for micro-living has suffered relatively little from the general crisis mood in 2022. However, CBRE analysts are not making a forecast for 2023 due to an expected compression of yields. Will micro living impact the hospitality investment market? Make up your own mind by reading this (German).
Unlike start-ups and SMEs, big companies such as Booking.com take a slow approach to adopting generative AI technology. They prioritize privacy, ethics, transparency, and energy efficiency, with the CEO of Booking.com emphasizing a successful implementation to maintain the platform's trustworthy reputation. More details here.
Short-term rentals such as Airbnb make up almost 25% of all tourist accommodations. The EU is now pushing for greater transparency from accommodation brokers, such as Airbnb, and requiring hosts to register their properties with authorities under new rules. Although this increases administrative processes for hosts, it should protect travelers from fraud.
Economics, finance, geopolitics. All have an impact on the hospitality sector. This part summarizes those.
The crisis is coming! Or is it? We have been seeing quite a lot of opinions this week. All saying polar opposite things. So what to listen to in the sea of opinions? Well, let's start with facts. Supply chains are slowly crumbling across a variety of markets, mostly due to war and demographic crises looming across the world. Yet inflation across western countries has started to drop. Mostly thanks to various companies ramping up their production after the COVID break.
At the same time, the real estate market is showing typical signs of an upcoming financial crisis, dropping investment in real estate and dropping prices. Even though there has been a recent surge in investment again (thanks to buydowns organized by developers themselves), the market is likely to crash due to high interest rates set by various federal central banks across the world.
Inflation has a weird way of impacting our lives. One of those impacts is funny enough a high dividend payout (in fact, one of the highest in the past years). Arguably a move by various corporations trying to show off their strong economic stability. Likely PR payout trying to attract investors in a turbulent stock market (common strategy being to invest into strong, cash-rich businesses during financial crises).
So what do the “experts” say? Well, Michael Burry, one of the main investors who have predicted the 2008 crisis (also represented in the big short) has quit Twitter again. His last tweet being “sell”, referring to stock. In his opinion, the current S&P index will likely drop by half due to extreme inflation coming our way. It has not happened yet, and M. Burry was likely getting a little frustrated with the ignorance several other investors have shown when reacting to his messages. He is of the opinion this crisis is only starting. Only the future will tell.
Scientific papers are being published every day. Including the hospitality sector.
COVID is over, but is it really? At least in the minds of our beloved tourists? A question a recent study is trying to answer. Comparing pre-pandemic habits (or reasons to whether to travel or not) vs post-pandemic. Results? We are back! Makes sense, since psychology and evolutionary mind will not change no matter how many masks we have to wear.
While not released this week, but late 2022 EU-wide regulations on Airbnb have shown little effect on the actual amount of guests staying. They have indeed decreased the numbers, but significantly enough to say that Airbnb is no longer a thing. Whether it is the lack of compliance or weak regulations. Overall Airbnb trend across main EU cities is seemingly unstoppable.
Books, podcasts & the big stuff.
The difference between our species and a few fellow apes is DNA-wise only a few percentage points. But what is it really that made our ancestors leap forward and finally open the first Hello Kitty hotel room? Well, this book explains it pretty well. In short, having to socialize with our fellow species forced us to learn and adapt in return The Social Leap happened, our brains grew 1 kg from one evolutionary stage to another, and finally, Homo sapiens appeared. This book explains a lot, from management styles to happiness and how it is all tied to evolution. Want to go outside your comfort knowledge circle, this is a pretty good start.
5. Tips & Tricks Tools & SaaS
Any new software you can use? Industry tricks you missed? All of that summarized below once a week.
Heard of blockchain? We did too. Think it's useless or at least with no direct impact on our industry? Well, some would say you are wrong.
We have all heard that one should respond to their guest reviews. But how? A brand-new guideline has shown up that might give you a pretty good framework.
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