2020 Snapshot: The Future of Accommodation

Attended by the country’s top travel buyers and suppliers, this year’s theme, “the journey to 2020”, discussed the outlook for the future five years within the travel sector. 

With this in mind, the 2020: Future of Accommodation break out session featuring Jo Layton, MD group commercial sales, The Apartment Service was the perfect place to explore the latest travel developments and predictions for the future. 

Panel discussion topic:

Economic growth, increasingly sophisticated technology, evolving consumer habits and new market entrants are converging to change the landscape of the accommodation sector. The necessity for the corporate hotel programme is no longer guaranteed. Hotel revenue and yield practises are often undermining discounts, making alternative buying strategies often more effective. Traditional hotel groups are investing heavily to develop their brands, products and services to adapt to new traveller expectations. Meanwhile, suppliers from the sharing economy  – such as ‘Airbnb’ and ‘Bed Y Casa’ are making serious attempts to attract business travellers. At the same time technology is putting more power in the hands of the consumer. What will the future hold?

Moderated by Martin Ferguson, journalist and media strategist, the panel also featured:

Michelle Grant, director of sales, Hilton Hotels, Scotland

Steve Reynolds, CEO and founder, tripBAM

Paul Saggar, group director of IT, Maybourne Hotels

Michael Funnel, VP, Travel Services, Barclays

After brief introductions, the discussion started on a shifting landscape full of challenges to the traditional supply chain. The conversation quickly moved to the increasing disintermediation affecting the market and the general striving for cost saving efficiencies in supply.

Steve Reynolds’ TripBAM and the products’ potential disruptive implications to the travel market was the natural focus. Reynolds, an accomplished travel technologist and business travel executive explained that his new hotel shopping service uses unique “cluster” shopping processes to find savings on hotels for corporations, TMCs and business travellers. “Travellers should be rewarded on lowest rate possible” said Reynolds, with his company perhaps viewing more developed and sophisticated travel buying practices prevalent in the US, becoming more mainstream within the European travel market over time, “the days of leakage are going to go away” he continued, “Priceline and Orbitz dominate the OTA sector in the US, Google will be the industry’s biggest competition.”

Layton appeared unconvinced TripBAM would achieve the necessary cut-through in the European TMC and business travel market, but agreed the concept is an innovative approach particularly attractive to the Millennial traveller who “would rather engage than be managed – the CompareTheMarket style of price comparison is what they’re used to.” 
When asked about the challenges the panel expected in the future, Barker looked towards the continued evolution of mobile apps and personalisation improvements, and an increase in direct sales behaviour. And hoped the industry would “bring external knowledge in data” expertise.

Reynolds felt the threat of short-term rental websites listing hotel inventory like Airbnb was a huge threat. Barker agreed and said some travel managers were using a disclaimer for unmanaged travel through short term rental channels, which he would not advocate.

Layton offered a different perspective by highlighting serviced apartment inventory, and a requirement and difficulty in tertiary markets and sourcing suitable locations, “serviced apartments tend to be the trailblazers with travellers by providing accommodation in these regions first, leading to hotels coming later with 2 to 3 night offerings” she said.

Grant said the winners will be those that “embrace technology and the smartphone to ensure growth with new customers and a new experience. We at Hilton Hotels will be committed to ensuring rates are visible in all the right channels, and growing our relationship with corporate business.”

Concluding the session, Funnel added that he felt ‘value’ within corporate relationships would be redefined in the future, and requested hotels and serviced apartments to commit to offering corporate buyers preferred rates at all times.