Innsights
Sukhdev Toor, Manga Hotels, and a family vision for the future
FEATURE PROFILE: Feature from the FALL 2024 ISSUE of STAY Magazine
Innsights
To 2024 and beyond...
INTELLIGENCE PROFILE: feature from the WINTER 2024 issue of STAY Magazine
Hotel and travel trends around Q1 2024, by the numbers...
Jim Byers
SEVERAL MAJOR BRANDS AND TRAVEL COMPANIES have issued forecasts for 2024, and it’s mostly good news for the Canadian hotel industry.
Canadian travellers are looking for better sleep on the road and are more willing to use artificial intelligence to plan their trips. We’re also likely to see rising room rates in Canada, a continued slow recovery for business travel and more off-season travel.
Here are some of the predictions and trends singled out by Hilton, Hotel Planner, Expedia and other travel companies.
HILTON: TRENDS INCLUDE SLEEP AND FRICTIONLESS TRAVEL
A late 2023 survey of more than 10,000 travellers from around the world found that hotel guests next year will be looking for better sleep, more culinary and cultural options, and more connectivity.
A Hilton/Ipsos study also found that travel shows no signs of slowing down. Nearly two-thirds (64 per cent) of global travellers say they aim to reduce other areas of their personal spending to prioritize leisure travel in 2024.
In 2024, travellers will look to engage with products and brands aligned with getting a good night’s rest, Hilton officials said. Gen Z’ers are the most intentional about winding down, making small choices throughout the day that can make a big impact on their sleep, such as regulating their workout routine and avoiding alcohol before bedtime.
Kevin Morgan, global brand head, Tempo by Hilton, said Tempo hotels have created specific zones; a “get ready for your day” zone where a guest can exercise, finish some work or practice yoga, a bathroom with an oversized shower and a mirror with a Bluetooth speaker so a guest can listen to a podcast, and a “power down zone” with a Sealy mattress that’s exclusive to Hilton.
Amanda Al-Masri, vice president of wellness, Hilton Hotels, said there’s a Peloton bike in every hotel in the United States and many in Germany, the UK and Canada, allowing guests to take their exercise routines on the road.
Eighty per cent of global travellers surveyed said it’s important to be able to book their trip entirely online, with 86 per cent of Millennials and 83 per cent of Gen Z’ers leading the charge.
Dan Morton, vice president of guest experience, Hilton Hotels, said 76 per cent of global travellers appreciate an app that reduces stress and friction in their travel journey.
Culture and experiences, plus business travel
Dining, culture and connections are inspiring leisure travel decisions as people increasingly prioritize the purchase of experiences over things, Hilton’s study suggests. As they budget for 2024, travellers’ top focus is on culinary experiences. Second to culinary experiences, 47 per cent of travellers will prioritize exploration and adventure, with Gen Z’ers and Millennials (52 per cent for both) carving out more budget for these types of experiences than the other generations.
Ways of work have transformed significantly following the pandemic, including shifts in when, where and how people conduct business. As a result, business trends have emerged and strengthened, including blended leisure and business travel, increased length of stays and the rising popularity of secondary markets for meetings and events.
Forty six per cent of global full-time and self-employed workers plan to travel for business or bleisure, while 24 per cent of business travellers plan to take a friend or family member with them on a business trip next year. More than a third of Gen Z and Millennial business travellers said they plan to extend a business trip in 2024 to enjoy leisure time before or after their work obligations.
Jess Petit, senior vice president of commercial strategy, insights and analytics, said programs like Hilton’s Project H3, which provide apartment-style accommodations for guests who might stay up to three weeks or more, are growing quickly.
“We’re trying to build products that really suit the needs of all of our guests, but we’re seeing so many customers that are looking for that long-term stay, and having a travel experience that really matches that.”
Gerilyn Horan, VP group sales and strategic accounts, said 85 per cent of the business travel Hilton sees in its hotels is from small and medium-sized companies.
AMERICAN EXPRESS: OCCUPANCY AND RATES
After three rollercoaster years, hotel rates will continue to rise in most locations globally during 2024, according to a report by American Express Global Business Travel (Amex GBT). The Hotel Monitor 2024 report found that most cities around the world should experience rate increases in line with local inflation, following the large price jumps in 2022 and 2023 fueled by a surge of so-called “revenge tourism” which helped inflate rates.
According to the report, Canada’s hotel industry achieved record-breaking average daily rate (ADR) and revenue per available room (RevPAR) levels in 2023. Vancouver saw the country’s highest occupancy, at 89 per cent.
Across the country, rates are expected to rise by about 7.8 per cent. The Amex study predicts hotel rates will rise 8.9 per cent in Vancouver, 8.3 per cent in Montreal and 6.7 per cent in Toronto in 2024, more than a point below the national average.
While global inflation is set to fall in 2024, the report said rising costs will continue to impact hotel bottom lines. A key factor is staffing, as Amex said hotel wages in North America are at record levels.
“Traditionally, low occupancy acted as a trigger for hotels to lower rates,” the report reads. “Today, hotels are happy with lower occupancy so long as they can raise their rates. This is especially the case in destinations where hotels cannot deploy their full inventory because of staff shortages.”
EXPEDIA: THE RISE OF SPORTS TRAVEL
A late 2023 report from Expedia, Hotels.com and Vrbo found that almost half (42 per cent) of Canadian sports fans were more likely to travel and see a game on the road rather than attending a game at home or in their closest sports city.
The Sports Travel Road Game Report also found that the average fan takes approximately three sports trips per year, and that 80 per cent of fans are looking to take either the same or more trips in the upcoming year than they did the previous year.
Fans prioritized sports travel over dining at restaurants and going to concerts and reported spending on average $4,294 per year on sports trips (including travel, accommodation, tickets and food). For football fans, the cost per trip was said to be approximately $500 higher than the average fan trip, while hockey fans estimate an average spend of $1,291 per trip.
Not surprisingly, the top cities for sports travel in Canada are Toronto, Montreal and Vancouver.
Music and television/movie travel
In 2023, the cultural impact of the Taylor Swift Eras and Beyonce’s Renaissance tours was undeniable, driving ticket sales but also travel and tourism. Expedia predicts that Tour Tourism will continue to thrive in 2024. Nearly 70 per cent of survey respondents say they are more likely to travel to a concert outside their own town, with more than 40 per cent saying they'd travel for a concert as an excuse to visit a new place. Unexpected cities on Expedia's list of top tour tourism destinations are Kuala Lumpur, Edmonton, and Mexico City.
Expedia also says travellers are increasingly looking for great vibes when they book a hotel. Beyond searching for specific amenities or star ratings, a hotel's overall vibe is becoming a strong indicator of travellers' hotel choices. Guest reviews mentioning the word "vibe" have increased an average of 1,090 per cent year-over-year, and 9 out of 10 travellers say the vibe of a hotel is important when booking.
Travellers are seeking a variety of vibes when searching for hotels from "Modern Vibe" and "Industrial Vibe" to "Retro Vibe" or "Margaritaville Vibe," Expedia said. "What contributes to a hotel's overall vibe? Travellers say the top element is customer service, which surpassed the music, interior or lighting of the hotel."
HOTEL PLANNER: NO MORE SHOULDER SEASON AND THE CHINA MARKET
In an interview with STAY, Philip Ballard, chief communications officer & head of investor relations at Hotel Planner, said he’s noticed a blurring of the seasons, to the point where shoulder season may become a thing of the past.
“People are waiting until September or October or even November to visit Banff or Halifax. You can save a lot of money, ensure rooms are available, and there are no crowds.
“Business people are continuing to add time at the start or end of their trip so they can explore a destination with their family,” Ballard said.
There also has been a “massive” rise in digital nomads.
“They can work anywhere in the world and go city to city, week after week or month to month.”
Ballard said at least 15 countries have digital nomad visas, perhaps even 20.
Revenge travel eases
Revenge travel was a big trend in 2022 and 2023, with tons of North Americans flying off to Europe and other destinations they could only dream about during the pandemic. Ballard said 2024 will be a robust year but that demand will be down slightly.
He also believes many people have spent their COVID savings and are worried about inflation. If that’s true for Canada, it could mean more Canadian travellers will stay closer to home this year.
Canadians also are booking further in advance and thinking more strategically. That doesn’t mean they don’t book last minute, but they’re more comfortable planning ahead right now.
Conferences are roaring back, but Ballard said business travel won’t be fully back until maybe 2024/2025.
“A lot of companies are cutting their budgets, and the first things that get cut are marketing and corporate travel.”
China Slow to Recover
Ballard also said the Chinese market has been slow to return to pre-pandemic levels, which is not great news for British Columbia and other destinations that rely on strong bookings from China.
“We haven’t seen the massive influx of Chinese inbound travel to North America yet. I think it will be another year until China gets back to normal. But India is now on the map. It just surpassed China in population, and a lot of Indians are travelling.”
That might not be a big help to Canadian hotels given the current Canada-India political dispute, but it’s a long-term trend worth watching.
Ballard said one trend he’s noticing is that ski resorts in North America are adding more spring, summer and fall activities, such as triathlons and bike races, as well as art and music programs, to boost their bookings. “They have great space that’s often underutilized when there’s no snow on the ground.”
Lastly, one big trend for 2024 is the solar eclipse that will take place next spring. Hotels and cities in Ontario, Newfoundland and other parts of Canada are announcing viewing parties, and hotel rates are already on the rise for the eclipse date, which is Monday, April 8, 2024.
BOOKING.COM: CLIMATE CHANGE AND AI TRENDS
A report by booking.com late in 2023 said Canadian travellers are increasingly looking for cooler vacation spots to battle climate change. They also increasingly trust artificial intelligence to help make their holiday choices.
The study found that 33 per cent of Canadian travellers would trust AI to plan a trip for them. As well, almost half (44 per cent) of Canadian travellers will want insights and tips from AI when on vacation to upgrade experiences with suggested ancillaries and deals.
With climate change such a major topic last summer and heat all over Europe, 40 per cent of Canadians said climate change will impact the way they plan their vacation in 2024. Three quarters (76 per cent) agreed that being close to water instantly makes them feel more relaxed, with more than four-in-ten (43 per cent) interested in water-centric vacations in 2024.
Maybe the strangest part of the study to me is that 28 per cent of Canadians say they make up stories about their real life when they meet people on vacation. Exaggerate, I can see. But making things up? Really? Who does that? “Oh, yes, I’m actually a marine biologist. I consulted on the George Costanza/whale episode on Seinfeld.”
Averse to the ‘sameness’ of everyday life and actively avoiding cookie-cutter experiences, the intuitively adventurous traveller of 2024 wants to step outside of the homogenized vacation, with 48 per cent preferring to venture off the beaten path and a quarter (26 per cent) seeking to travel with strangers. The majority (58 per cent) would like to have no plans set in stone prior to travelling in 2024 so they can go where the wind takes them, while over two thirds (65 per cent) prefer to travel with loose plans so they can change direction based on what feels good in the moment.
The travel industry is already responding fast with tech-enabled flexible services, giving travellers the option to cancel, change plans, and buy now, pay later at the press of a button. The explosion of AI, which has already seen the launch of Booking.com’s AI Trip planner, is going mainstream in 2024: 33 per cent of Canadian travellers would trust AI to plan a trip for them, with a third of baby boomers (30 per cent) and one in five (20 per cent) of the silent generation finally surrendering to AI in order to assist their travel plans in the year ahead.
Like Hilton, booking.com also reports that Canadians want to sleep better on holiday. Forty six per cent of respondents said they want to travel in 2024 solely to focus on uninterrupted shut-eye.
For those who are used to sleeping solo, over a quarter (29 per cent) of Canadian travellers would carve out time for a matchmaking holiday to find a spark with a new partner or lover, while 25 per cent would focus on a heartbreak holiday to get over an ex. On the contrary, for those still rocking their relationships, 23 per cent want to deepen that human connection with their partner as their main priority for travelling in 2024. On the flip side, for those increasingly frazzled parents, they are surprisingly seeking solace on completely solo holidays, with almost half (43 per cent) planning to travel alone in 2024, dropping the kids and their partners to prioritize their vitality.
Taking the impetus to reinvent their ‘real’ life, 41 per cent revealed that the stripped-back lifestyle of agrarian and Indigenous communities, where self-sufficiency is a way of life, would appeal to them in 2024. Beyond just back to basics, the focus is on a better balance with nature and the elements to reset their day-to-day back home.
One-half of Canadians (48 per cent) plan to pick destinations in 2024 where the cost of living is less expensive than their hometown, while travelling closer to home is also a draw for some who will be searching for luxe-for-less copycat vacations to reduce costs in 2024 (34 per cent). Many (35 per cent) Canadian travellers will be willing to pay for day passes to use the amenities in a five star hotel rather than actually staying there, with a similar number of parents (36 per cent) planning to take their children out of school to travel outside of peak season to make their money stretch further in 2024.
Their study also found that 40 per cent of Canadians are looking for accommodation that has wow-factor sustainability innovation. Half (50 per cent) want to see sustainability in action, while 56 per cent want to see the outside brought indoors with green spaces and plants in accommodations on vacation.
