There’s no question that business travel is back. We’ve all seen the news headlines and data indicating its return. When it comes to specific trends in business travel, spring has seen particularly strong growth. In April 2022 alone, 85% of companies in the U.S. traveled for business, and the volume of meetings and events saw a 323% increase year-over-year (YOY).
Despite this significant growth, a recent Deloitte study found that business travel is two years from reaching pre-pandemic spending. Is this growth consistent across the hospitality industry? Should hoteliers remain optimistic? What can they do to attract more corporate travelers and encourage business travel spend overall? We have some insights.
Chris Ardolino, our Vice President of Operations, agrees that business travel is making an overall slow and steady return. “Business travel levels have been steady in regard to the number of occupied rooms consistent with 2019. A two-year projection for those levels to return is accurate,” he says. “Corporate spend should be coming in line with 2019 sooner rather than later, as average daily rate has grown considerably.”
One factor preventing corporate travel from returning to pre-pandemic levels is the rising priority of sustainability within many companies. Most companies expect to reduce their business travel budget by 10% or less to adhere to sustainability practices. 30% of companies surveyed expect a reduction in business travel spend by 11-25%.
While corporate travel budgets are being reduced, “business travel is a necessary spend for all companies,” Chris mentions. “It’s how relationships grow, and it keeps the wheel of business turning.”
There are many ways hoteliers can appeal to a company’s commitment to sustainability, and thus gain more corporate travel customers. In fact, sustainability has been at the forefront of the hospitality industry’s efforts for 20+ years now, though it doesn’t get the press it deserves.
To improve your hotel’s level of sustainability, we recommend that hoteliers consider installing these energy savers:
We recently installed an Intellihot hot water on demand system and have seen great results. The Intellihot system heats water as needed, rather than storing and maintaining hot water in tanks. It utilizes far less natural resources than traditional hot water heaters and ensures that no guest will ever have a cold shower.
“We monitor the system with a mobile app, which updates us regularly on its efficiency. Now we have to get the word out to our travelers. This is the challenge not only for us, but for the hotel industry as a whole,” Chris says.
We have seen many shifts in hospitality and tourism with respect to corporate travel. As the Global Business Travel Association (GBTA) asserts, we are indeed entering the next phase of global business travel.
“The world does business best when it’s done in person,” argues Chris. The landscape has changed with companies switching some of their workforces to at home or going fully remote; however, no amount of technological changes will replace the need for business-to-business interactions to occur at the human level.
“The next phase of global travel will require some adaptations at the hotel level for sure,” he says. “Hotels will really need to be keen on design for new builds and adapt older hotels to fit the needs of today’s travelers and beyond.”
Design-wise, hoteliers must create spaces with an open feel and use materials and textures which are accretive to the overall sense of safety and wellness, yet still appeal to travelers’ preferences.
Chris leaves us with a few final words of wisdom, saying, “The worst of this pandemic may be behind us. However, we all have learned how important the safety and well-being of all humankind is. While that is always a priority, it now has a spotlight shown upon it.”
Narsi Properties is a private family-owned Hotel Development & Management company based in North Carolina. Founded in 1978 on principles of trust, authenticity, and family, we take pride in our community, guests, and team members as the cornerstones of our company values. Our philosophy of positive reinforcement ensures a comfortable and unique experience for hotel guests, in turn reassuring our investors and stakeholders of our consistent reliability and superior performance.