by Eugenia Dunaeva, Business Development Director
For the whole travel industry, it has felt like a long wait to see even a glimmer of hope, but the early signs are here.
No one is expecting a return to business as usual, or life as we knew it. It goes without saying that as the world and our industry recover from the COVID-19 crisis, many of the patterns and behaviors we knew will change drastically – some temporarily, some permanently. Accommodation booking is no exception.
So amid reports of an uptick in bookings [1] and interest in travel, it comes as no surprise that we're also seeing a shift in consumer behavior – particularly in Central Europe.
As Austria looks to stimulate inbound tourism [2], with hotels allowed to open from 29 May to travelers from neighboring countries, the German federal government's warning against worldwide travel now remains in place until at least 14 June. Of course, that doesn't mean that Europe's largest outbound travel market simply won't be going anywhere.
Whatever the developments over the coming weeks, travelers certainly won't be taking vacations as they used to. But does that mean that they won't be traveling at all? Intuitively that's unlikely, and industry data is now giving some clues about how travelers will be booking. One obvious development will be a major increase in domestic travel, as signaled by recent research from HVS [3], among others. But a second, less obvious one seems to be a shift in accommodation preferences.
German travelers seem to be looking away from traditional lodging (namely hotels) to vacation rental properties – apartments, villas, the significant Ferienwohnung sector in the country. At EPS we're already seeing this with our partners.
Ricarda Kies, VP Strategic Partnerships at DS Destination Solutions GmbH, an HRS GROUP company, says: “We are currently registering a significant shift in the demand for accommodation from both guests and distribution partners. Especially with a view to distance and hygiene rules, Germans seem to increasingly prefer holiday homes and apartments over vacations in large hotels. In addition, bookings currently predominantly focus on domestic travel, which we believe will further intensify as a trend this year.”
Some travelers may also feel more able to control social interactions and maintain distance from others in private, self-contained accommodations rather than larger ones. Of course, the hospitality industry is having to up its game in ensuring cleanliness and the sector is rising to the task, with hotel chains and vacation rental platforms alike putting new protocols and advice in place. While there are industry standards for hotels, this is comparatively new territory for vacation rental providers, but they are obviously keenly aware of the need to keep guests safe and to reassure them, as shown by initiatives such as VRBO's new resources for property operators [4]. Being able to prove the safety of accommodation and alleviate travelers' concerns will, of course, be vital to the travel industry's recovery.
But this shift to vacation rental properties may also be a mindset related to domestic travel. Vacationing in your own country may be less daunting, with a perception that self-catering is easier, and travelers may simply feel more 'at home'. The home-from-home experience that a vacation rental property provides over the typical summer vacation feel of a large hotel may be simply more in line with what people want to get out of a domestic holiday.
DS Destination Solutions partnered with EPS specifically to increase the variety of accommodations that it offers travelers, adding more than 180,000 vacation rental properties to its supply. These span a huge range of 35+ property types from fully self-contained cottages, villas and other types to residence to aparthotels, condos, chalets and even houseboats. But there are still large numbers of tour operators and other travel businesses that traditionally haven’t had access to this kind of product. Travel providers that don't already have access to this kind of alternative accommodation are going to need to diversify, and fast.
Next will be need to come a whole shift in mindset and approach: with fewer flights being sold, the concept of a package will also need to shift from 'flight + hotel' to something more like 'car rental + any accommodation'. But supply is the first piece in the puzzle. And it's a puzzle that travel businesses are going to need to solve urgently.
