Why put something on brand, when you can just make money?

Week 12 - Spike in hostel bookings, siteminder shares data from 100 million bookings, people protest while the financial crisis is coming.

TLDR: Too Long Didn’t Read

Hostels are doing great compared to the rest of us. Startups are innovating by removing brand standards (OYO). The war in Ukraine is going to take a while, and you should really care! Protests are increasing across the globe, mainly because the financial crisis is imminent.

1. Main Hospitality News

Core news related to the industry

150% of 2019 bookings sounds pretty good, doesn’t it? That is what hostelworld.com is reporting across a variety in hostels of South American countries. A spike that is yet to be beaten in any travel market. While we are seeing an increase, 2019 levels have not been reached almost anywhere in the industry (verified sources guaranteed). Overall an interesting trend, showing which sectors wake up from their corona blender regardless of the looming financial crisis.

OYO. You might not have heard of it, yet it was the 2nd biggest hotel chain in the world back in 2017 (9th atm). A startup like no other. Convincing small BnBs to join a chain that will revolutionize their revenue, distribution & operational efficiency. What is the headline they get this week? “OYO drops brand standards for growth” Counterintuitive indeed, nonetheless an interesting story to follow.

Skift tried to speak to Gen Zs to ask them what they care about and build an accurate image of what it is that these Zs want from hospitality. Results? More internet, more design & of course more community. Topics humanity prior never had the chance to address since they were too busy working. Want to learn more? Click here.

If you weren’t already mad with the spoiled Z, here is another article about the Alphas (one generation down). How do you trick this young folk to book your twin with a view on the courtyard? The current bet is on the metaverse. Virtual reality built and accessible through a variety of VR headsets across the globe. Why? Having grown up on the internets, this young folk are effectively immune to the typical kinds of ads and therefore require a new kind of treatment (at least so goes the current strategy around this young generation). Is it true? Only time will show.

Fellow budget hoteliers are concerned with their footprint on earth as well. Perhaps they have listened too much to the alphas. According to the article, 1% of entire CO2 emissions come from hospitality (with 8-10% of the entire GDP coming from hospitality that puts the industry at a pretty good ratio), nonetheless, 70% of those emissions come from heating. Whether it is gas, coal, etc. Solution according to the article authors? Change your energy sources to solar & wind. Off-topic for the budget operators amongst you, the less the star rating a hotel has, the less the utility consumption. (1-star guests take less time to shower compared to a 5-star guest). Hence, next time one looks for cause and effect, perhaps make sure all data is included.

2. Externalities

Economics, finance, geopolitics. All have an impact on the hospitality sector. This part summarizes those.

This segment is generally dominated by the same topics across months, hence you guessed it… the war in Ukraine. Xi Jinping has visited his buddy in Russia Putin, and together they agree the war should be stopped, but wait for it…. Russia (according to the 2 friends) hasn’t necessarily started the war, and neither is there such a thing as the Ukrainian border. Conclusion, this war is going to take a while. Why do I, a restaurant owner in Paris, care, you ask? Well, if you serve milk, pork, or have anything wooden at all in your fine establishment, it is very likely that the source materials for those products come from either Ukraine or Russia. But I BUY ONLY FRENCH Pork, you say! Good for you, hippie, but the market overall had a vast majority of pork, wood, etc. coming from those countries; therefore, a sudden drop in supply…. you guessed it, increases the price for demand. And there you have it folks. While some dictator is leading a war 3 thousand kilometers away from your home, your pork tenderloin is becoming more expensive every day.

Did you notice any flights being canceled or a car being set on fire outside your house? Well, then you are either in France, Germany, or Israel this week. The western world is indeed in protest mode. In Germany 27.03 all flights are canceled. In France, people really do not want to have their retirement age increased, and in Israel, a complicated mess of democracy, state independence, and other topics (we regular humans have no in-depth understanding of) is causing the general public to get on the street. An unfortunate externality making life difficult for the rest of us travel folk. Why? See academia.

Bhutan has obviously read our weekly posts and decided to take it to the next level. Offering gold at duty-free shops. Why? To offset the tourism fee impact, of course. We will keep you updated on the ratio of gold diggers vs. tourists in the coming weeks.

3. Academia

Scientific papers are being published every day. Including the hospitality sector.

Care about sustainability they asked. Yes, they said (88% more precisely). Give us more sustainable destinations they said. Kayak has listened and has done precisely that (more on that in tips & tricks). While multiple studies before have shown that guests, while “caring,” will not actually spend accordingly, this study is different. The majority will (at least according to the survey) make financial decisions using sustainability as one of the core drivers to make a decision. Perhaps Kayak conducted the survey in a an eco friendly convention…

Why do people protest? An exciting article from the economist summarizes well how protest spikes are clearly visible during specific periods across the entire globe. Almost in unison, people choose their least favorite topic to protest about and go out on the streets to burn somebody else’s property down. But why? In short, the financial crisis. A study of protest frequency across several continents showed a direct correlation between financial crisis and protests. Conclusion? Welcome to the “We have too much money” 2023 crisis.

4. Readables

Books, podcasts & the big stuff.

In the spirit of this week’s news, we wanted to recommend you a great sci-fi book where humanity presumes to be able to forecast the future using mathematics.. Source here.

5. Tips & Tricks Tools & SaaS

Any new software you can use? Industry tricks you missed? All of that summarized below once a week.

As a follow-up to the study mentioned in academia above, Kayak went ahead and created a detailed ranking of the most sustainable destinations. How? Most creatively! Looking at booking.com sustainability program data, Kayak compared the affordability of sustainable hotels vs. non-sustainable (as well as 27 other factors). The result is a magnificent list that indicates where you can travel and save the planet while you are at it. Useful for the travelers amongst us, but also for hoteliers, tour operators & travel company professionals who perhaps want to use this as an excellent marketing opportunity to sell capitalist consumer products to hippies.

Siteminder, the biggest channel manager across the board, has released a report summarizing some of the data they have access to across the industry. Want to know what is going on, summarized from over 100 million reservations across the globe, this is your chance.

Tired of your receptionist job at the Sheraton? Great, here is a podcast on how to spend the next 10 years traveling around the planet, sleeping & working at hostels, and making money telling other people about it.