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Experts say Covid-19 crisis will continue to test resilience of hospitality sector

MUSCAT: Hospitality industry was the hardest hit sector due to the impact from Covid-19 pandemic. The industry faced toughest challenges with travel demand declining from March 2020.

The industry looked for creative ways to generate revenue and utilise hotel assets. The Observer spoke to few hoteliers and experts who offered insights of how hotel groups generated ideas during the pandemic and spurred the domestic market with staycations.

Prashant Sharma, a seasoned hotelier and mentor in Oman, says with the increase of room supply in Oman in the coming months, hotels will be able to broaden their array of distribution through electronic channels. This will mean low-cost source of business and if used wisely through revenue management techniques, there can be an increase in occupancy with the right average room rate.

“Revenue Management (RM) is constantly evolving and technology plays a key role today and if we take a serious look at room occupancy, high percentages directly or indirectly are influenced by the internet. TripAdvisor, Google Hotels, Trivago will play a key role as these metasearch sites are particularly good with an easy booking process for hotels. Online Travel Agency (OTA)’s are a good source for consumers to research sites like Priceline, Expedia, and Orbitz which have huge audiences while in some properties OTA contributes 45 to 50 per cent of total room nights,” he explains.

Samir Messaoudi, General Manager, Sheraton, says RM like all hotel departments has evolved with the pandemic and has been a learning curve to market conditions. Covid-19 has shown the importance of total yielding including rooms, F&B, spa and will continue as a trend in upcoming years.

“Hotels were forced to make the most out of limited demand with borders closed as opposed to high demand in pre-Covid times. “With supply constantly increasing in the market, RM will evolve to a more dynamic state that rates and strategies are changed rapidly reacting to changing conditions. Short term room rate yielding will gain importance over traditional long term rate positioning,” he says.

He further adds that hotels must strive to be innovative to create demand and adjust to domestic market trends during the pandemic as the only source of business, with the opening of borders and restrictions selling at the right price and ensuring to re-build business.

Fady Gerges, Director Revenue Management, JW Marriott Muscat, is of the view that RM plays a critical role in recovery strategies during crises, helping to understand the changes in business which enables it to take data-driven actions.

“The pandemic,” he says, exposed the limits of existing RM systems and forced leaders’ approaches to evolve. He says they are focusing on a more strategic approach to RM by working in close collaboration with other key departments to develop long-term, and above all, flexible, strategies, and using analytics to measure, understand and make informed recommendations.”

While, Sushrita Tripathy, Revenue Manager, Fraser Suites Muscat, views the Covid-19 crisis as a challenge as hotels cannot rely on historical data and need to input more externally generated data to create predictive models for demand and forecasting. She says the situation will continue to test the resilience of the hospitality sector for a foreseeable future which will depend on the circumstances of individual countries.

Tripathy suggests that operational policies have been relaxed to boost travel, including free cancellation and flexible check-ins and check-outs to encourage travelers to book hotels as the domestic market is seen to have potential for growth.

“Industry is expected to analyse and focus on various market intelligence sources to understand different segments of the market, their travel purpose, behaviour, value perception changed by the pandemic. It is important to maintain business continuity, and strictly follow government policies, managing service demand compliance risk,” she adds.

Shailesh Fernandes, Revenue Manager, Shangri-La Resorts in Muscat, says “the behavioural change towards embracing digital channels of communication unlocks whole new opportunities for revenue generation, which is not only convenient but also a great way to stay in touch and build meaningful relationships with guests quickly and efficiently.”

He mentions that the Shangri-La Resorts anticipates a sizable portion of their business shifting from the traditional offline channels to online, where most of their guests have already switched to chatting via their business WhatsApp channel or sending notes on social media platforms.

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