Dave Goldstein, managing director at KSL Capital Partners noted that although a large number of its hotel businesses either shut down entirely or closed substantially, the company has seen almost a full recovery in demand levels.
“Leisure didn't go anywhere – people still want to go on vacation, they still want to gather, get together and have fun.”
Javier Coll, global head of growth at Hyatt Inclusive Collection agrees noting that in the last two years, the company has had record profits for its all-inclusive business even when compared with pre-Covid peaks of 2017 and 2019.
“We already had a good base of customers and now we have all these untapped markets that we didn't have before more customers now appreciate the value for money offered by all-inclusive. And that increasing demand makes more interesting for investors to invest.”
Bleisure and all-inclusive
But as the lucrative leisure segment attracts more and more attention, evolution is becoming more of a necessity. And for Coll, some of that evolution is coming in the way embracing a growing travel trend – bleisure, which is a blend of business and leisure.
“We’re adapting many of our resorts for that bleisure type of travel because we saw that trend coming post-covid. In every hotel we do, that’s a source of business we look at when we design our hotels and our facilities. We certainly don't think it's going anywhere and we really see good potential in that type of business. There are still a lot of employees working remotely and we don't think that’s going anywhere.”
He adds: “Covid has accelerated the evolution and we see this happening for the next ten years because there's so much interest now in all-inclusive as an investment category that it’s accelerating the concepts and the attributes of those hotels and the type of facilities.”
And the value in all-inclusive, experts note, is that it can be offered as different price points and different quality levels, even reaching about a thousand dollars per person per night for the ultra-luxury offerings.
Goldstein explains. “It’s about the degree of inclusivity: you can look at packaging - the bed and breakfast package is in theory some version of an all-inclusive package. We have to create meaningful enticements that feel like it's an inclusive package whether we’re packaging skiing with tickets to the water park or figuring out ways to put in spa and golf as part of the stay. It’s about being much more thoughtful about who the customer is, what's the value proposition for that customer, how do we define them and how do we package it?”
Silver linings
Niklas Rytterstrom, president and COO at Borgata Hotel Casino & Spa says that the closures of its properties helped the company to understand its business a little better, therefore allowing it to implement changes and adapt.
“We certainly understand our customer better today. The pandemic forced us to do things that we haven't done - there were trends in the market that we knew were coming for example mobile check in but Covid exponentially sped up that demand. We became better as operators and better with technology because of it,” he explains.
And F&B is not to be left out, with experts highlighting developments such as increased use of QR codes not just for restaurant menus and remote ordering but also for augmented reality uses.
“Can people use their phone to get augmented reality activation of something? Can they interact with a piece of marketing collateral in a different way or obtain media that they can consume? It has become a much more valid tool and interface,” Goldstein says.
Sustainability and AI
And sustainability is becoming more of a focus, particularly in ski resorts with Alinio Azevedo, CEO of Aspen Hospitality, noting that more holidaymakers are increasingly questioning sustainability practices.
“We’re seeing clients pushing and questioning us more and more on those things because our business is so related to nature and how we interact with the environment.”
AI is another key topic in the conversation about evolution, with Ritterstrom emphasizing the potential of AI to enhance guest experience and improve operational efficiency.
“I think AI will have a large part to play in particular when it comes to things like concierge, planning your itinerary for your stay as well as data when it comes to demand and pricing.
Goldstein also highlights the application of AI in capex investment and design, noting its potential to optimize room layouts and improve real estate efficiency.
Azevedo adds. “There is opportunity to try to customize data, statistical models to try to enhance productivity when it comes to labour costs and back of house. It's all about analysing data and then making recommendations on how you can deploy resources in a more effective way.”
Looking ahead, experts agree that while they see the resort business materially up over the next twelve months, the ability to adapt to trends and new developments in the space remains vital.
By Ifeoluwa Taiwo
