H&E North examines why a luxury offering could be key to helping venues bounce back from the brink.
As the pandemic continues to rock the industry, luxury venues are one of the hospitality sectors that have been among the hardest hit. Over the peak summer season, some of the UK’s most prestigious hotels registered occupancy rates as low as 10.3%. However, in many respects, luxury venues are uniquely placed to weather the storm. Whether that is through better equipped facilities, a reputation for higher standards, or enhanced capacity to adapt, they may just have what it takes to coax reticent visitors through their doors. As the old adage goes, the cream may well rise to the top.
Scott Brown, Director of Sales in the north for INNSiDE by Melia – Meliá Hotels International’s “superior” segment of its global portfolio – feels the luxury hotel sector is uniquely challenged given the segmentation of its customers: “Generally group bookings make up a significant portion of their occupancy and if no groups over 30 can travel this rules out the majority of MICE business. In terms of the transient travel, corporates are either unable to travel or strongly advised not to and while leisure travellers can book, with limited cultural, sporting or dining options available then this is also stripped back considerably. The remaining travellers are those that need to travel and when travel is stripped back to its absolute necessity, then a luxury option is often not preferred.”
Maria Pajares is Managing Director of Mason Rose, a PR agency with 25 years’ experience working with luxury hotel and travel brands across globe. As venues across England strap-in for a nationwide lockdown for the month of November, she speculates what this could mean for an already challenged sector: “The trials and tribulations of a travel and hospitality sector in lockdown are sadly more than familiar to us all – limited or zero business, changing regulations, cashflow, staffing and jobs, not to mention the impact on morale and mental health.”
However, she believes luxury venues have used their amplified resources to respond with more speed and creativity to the crisis compared to their budget competitors: “Luxury hotels and venues already had high levels of cleanliness and have therefore been considered a ‘safe’ option for both leisure and corporate gatherings or escapes. While there was already an appreciation of this high level of hygiene among both corporate and leisure customers, many of these venues have uploaded detailed reinforced hygiene reports on their website which offers great comfort and security to users.”
Among the aspects unique to a luxury offering which have helped the industry pull through is the sheer space and abundance of private facilities. Where many hotels in the budget sector have been forced to close their communal spaces, such as indoor pools and spa areas, luxury hotels with private en-suite facilities have been able to maintain their luxury offering and uphold distancing where others simply can’t: “Hotels with separate accommodation have been able to offer the space and privacy that many have been looking for. Prior to the pandemic, we were witnessing an increase in desire for privacy and more and more hotels building standalone villas on their grounds – the current situation has only enhanced this further and we see this trend continuing into the future.”
Melia’s INNSiDE hotels are just one of the luxury brands which have adapted to the changing demands of the market. “We have certainly worked on our pivot!” says Scott. “We now offer ‘Workation’ packages for those who need a safe, isolated space to work. The current English lockdown notwithstanding, large outdoor heated spaces such as our new terrace at the INNSiDE Manchester lounge and grill certainly helps those who want to enjoy a cocktail or bite to eat, alone or as part of a business meeting do so safely and within regulations.”
Many venues are similarly welcoming a new type of customer, as with one of Maria’s overseas clients, Adriatic Luxury Hotels in Dubrovnik. This new target market is the international business person seeking to book an extended stay: “Croatia has become one of the first countries in the world to put in place a digital nomad visa for exactly this purpose. We have heard from various hotels in different parts of Europe that they have been welcoming corporate guests for extended stays, combining an escape with the potential to work, given the ease with which business can be conducted from a luxury hotel with high speed Wi-Fi and all the latest technology that may be required.”
As many of us seek something to look forward to in order to get us through these dark times, Scott considers luxury venues to be far better placed to capitalise on the resurgence of bookings once the end of the pandemic is in sight: “I think that ultimately the desire for a luxury experience, somewhere to escape, to relax, to dine, to enjoy will be even more needed following the challenges we have all faced. I really do see a pent-up demand for people to get back to enjoying fulfilled experiences and hotels in the luxury category certainly offer that.”
Maria sees many venues using this opportunity to rethink how their businesses can come out of this even stronger: “The whole community has looked to the future, focusing on issues such as reconfiguring spaces and experiences, rethinking brand messaging and tackling sustainability. While there is no doubt the next six months will continue to be extremely challenging for so many of us working in the industry, we believe that we have come together as a community like never before. We believe that the luxury travel market will bounce back, and perhaps as a more refined, considered version of its previous self.”