Resort Large IHG Knowledge Reveals Youthful Vacationers Now Favor A lot Shorter Reserving Home windows – Skift
The coronavirus pandemic continues to raise a big question mark in the travel industry and when demand returns to 2019 levels. Changes in consumer behavior are not helping hotel companies like IHG plan a recovery.
According to a company report released this week, IHG’s new normal voyage on both sides of the Atlantic will see dramatically shorter booking windows. 63 percent of Americans now reserve an IHG hotel within two days of staying, compared to 39 percent last year. Almost 40 percent of UK travelers book in the same two-day window, compared to just over 20 percent last year.
With such short booking windows, it seems impossible for a hotel company like IHG to anticipate future staffing needs – let alone plan growth. However, the company said it is largely looking forward to building confidence through reinforced cleaning programs like the Way of Clean program.
“The key is staying true to your strategy and understanding that travel today is primarily about the safety and wellbeing of guests,” said Brian Hicks, IHG senior vice president of trade and revenue management.
IHG officials attribute the shortened booking windows to ongoing uncertainty about the pandemic and ever-changing travel restrictions. The company, along with many of its competitors, has introduced flexible cancellation policies and special offers for “Book Now, Pay Later” to give travelers more confidence in their booking.
Currently, according to the IHG report, only 22 percent of American and 31 percent of British travelers make hotel reservations beyond a week.
The hotel company has also dealt with the exhaustion of older travelers. Given the pronounced impact of the coronavirus on older populations, many stay at home and avoid staying in a hotel.
The number of active US travelers aged 65 and over decreased from 18 percent in 2019 to 15 percent in 2020 in the months of March through August. In the UK, the number of elderly travelers fell from 16 to 11 percent over the same period.
The 35 year old and younger population group recovered the most from the depths of the pandemic, according to the IHG report. While the return of older travelers largely depends on confidence that the virus has been contained, there are potential financial opportunities for IHG and its numerous drive-to brands like Holiday Inn Express.
Domestic hotels accounted for 95 percent of bookings in the UK during the pandemic, and more than 85 percent of guests chose to use their own car. According to the IHG study, more than half of US travelers chose to stay at a hotel within 186 miles of their own home.
“While it will take some time for confidence in international travel to recover, we expect the strong interest in domestic vacation travel to continue,” said Hicks. “Travelers make new memories of exploring cities and towns in their vicinity, familiar places are established, and I think people will return to where they had pleasant experiences.”
Rural locations in the UK like Kent and the Isle of Wight were among the top ten UK travel destinations this summer, while large cities like London lost popularity. In the US, Florida Panhandle, West Texas, and Carolina Coast were in the top 10.
IHG executives previously noted that the company’s focus on domestic travel with some of its lower-priced brands provides a competitive advantage over other global hotel companies that focus more on conventions and long-haul business travel.
“Given that we are largely a domestic mainstream company, there is a fair way we can grow back before we hit the international traveler hurdles that I don’t think either of us feel like he will be returning at this moment on short notice, “said Paul Edgecliffe-Johnson, IHG’s chief financial officer, during an investor briefing in August.
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