#1 Stability
Travel demand is likely to stabilize in 2024 benchmarking record occupancy and rate. Current trends indicate that the industry is reporting a decline in many markets for leisure travel (Thursday – Saturday as many consumers are getting out priced in the market), while group travel remains strong as Milwaukee will experience in 2024; with a slight increase in corporate bookings (Monday – Wednesday travel). The Industry will see 65+ percent occupancy overall and even higher ADR in 2024.
The hospitality industry has been witnessing a resurgence in various segments of travel. Group travel, in particular, has seen a steady rise. This trend has been fueled by a desire for shared experiences and reconnection after periods of travel restrictions.
Corporate travel is another positive indicator as businesses adapt to new work models post-pandemic, many are resuming business travel for meetings, conferences, and collaborations and the daily work schedule. This renewed activity not only benefits hotels, but also other sectors related to travel and hospitality.
#2 Labor Shortages
The hospitality industry’s labor issues are on track to persist in the coming year. According to the Washington Post, nearly 2 million hospitality and leisure jobs remain unfilled and this will likely continue into 2024.
#3 Price Increases for Rooms
In 2022 Room rates peaked over 2019 for the first time and 2023 will remain high or higher at the national level and for many U.S. Markets. Including Milwaukee.
#4 Use of AI increases
AI-powered chatbots and virtual assistants are already revolutionizing customer service and replacing staff in various industries, including the hotel sector. They offer benefits like:
- 24/7 Availability: Chatbots can provide immediate assistance to guests at any time, reducing wait times and ensuring support is available round the clock.
- Personalized Service: By analyzing guest preferences and past interactions, AI can offer personalized recommendations for dining, activities, or room preferences, enhancing the guest experience.
- Efficient Reservations: Chatbots can streamline the reservation process by handling bookings, modifications, and cancellations, making it convenient for both guests and staff.
- Quick Problem Resolution: They can efficiently address common guest queries or concerns, freeing up human staff to handle more complex issues.
As AI technology continues to advance, these capabilities will likely improve, providing even more seamless and tailored experiences for hotel guests. Yet, we are taking people out of the people/service business.
#5 Sustainability
The shift towards sustainability and social responsibility in the travel industry isn’t just trend anymore; it’s becoming a significant factor influencing consumer choices and group demands. Travelers are increasingly conscious of the environmental and social impacts of their journeys, and they’re actively seeking options that align with their values.
Hotels and travel companies that prioritize eco-friendly practices, support local communities, and demonstrate social responsibility are not only meeting ethical expectations but are also attracting a growing segment of conscientious consumers. This shift isn’t just about goodwill; it’s proving to be financially rewarding as it appeals to an audience that actively seeks out businesses committed to making a positive impact.
