How Millennials Are Influencing Change In The Hospitality Industry
With a reputation for knowing exactly what they like and don’t like, millennials are redefining and reshaping the hospitality industry. Is your hotel or resort equipped to meet the demands of this very demanding (and lucrative) customer segment? In this blog we will begin by reviewing the data and market research for insight into these passionate and picky travelers who are changing the face of your industry.
The millennial generation is composed of 20- and 30-somethings, or those born between 1981 and 1997 according to the Pew Research Center. They account for 27 percent of the global population or about 2 billion people. The approximately 83 million millennials who reside in the U.S. are not a monolith; in fact they are perhaps the most diverse generation in American history. By 2020, they will account for 50 percent of the workforce globally and, according to the analysts at Bernstein, millennials are poised to have more spending power than baby boomers – in many ways, they are the most powerful and influential consumer group that we have ever experienced.
Constant Demand for Technology
Millennials represent the first generation of digital natives. They grew up in a time of rapid technological change, are connected 24/7, and are capable of managing an array of applications with ease. When it comes to traveling and hotel stays, millennials are keen to use technology to make their lives easier and their travel experience more seamless. They are driving the demand for technology-driven, experiential travel and sustainable practices.
What does going digital mean for your hotel or resort?
It means leveraging technology at every stage and every touch point throughout your customer’s journey. If your hotel’s digital presence isn’t up to par, you simply aren’t going to attract your share of the millennial market. If your website is not mobile-driven or if you’re not engaging on the right social media platforms, the millennials won’t give you the time of day.
Consider these data points:
- 87 percent of millennials use between two and three tech devices at least once a day
- 46 percent book travel through a smartphone or tablet
Because they were raised in an era of instant gratification, millennials may be the most impatient generation ever. Waiting in long lines for hotel registration is so yesterday. In a survey of 500 millennials, 90 percent indicated they would rather use their mobile device for check-in.
Placing check-in kiosks in the lobby is another attractive option, as are charging stations. Free Wi-Fi is no longer an option — for the millennial market, it’s a non-negotiable.
According to research, millennials are 50 percent more likely than previous generations to say social media and blogs are important factors in their decision to book a reservation.
Millennials expect brands to not only be visible on social networks, but to engage them with relevant content and helpful guidance. According to studies, 62 percent of millennials say that if a brand engages with them on social networks, they are more likely to become a loyal customer. Engage them and you will be rewarded.
Hospitality is a reputation-driven sector, and what people think and say about your brand can make or break you. According to research, 89 percent of millennials trust recommendations from friends and family more than self-serving claims by a company, and they are 247 percent more likely to be influenced by blogs or social networking sites.
People are talking! Artificial intelligence can be used to quickly analyze social-media posts and provide insight into the narrative or conversation that is being spread about your brand. If issues arise, you can dress them in real time, before the damage to your reputation is done.
The takeaway: To remain competitive, hotels and resorts must ramp up their social media and digital marketing efforts. It’s not merely a nice thing to do; your property’s future economic viability depends on it.
Credit Suisse’s Global Investor report turned a lot of heads when it was released in 2017. It concluded that the millennial generation’s insistence on being eco-friendly was influencing many sectors: “Companies must deliver good social and environmental performance and engage in sustainable practices or their future growth could be at risk.”
Hoteliers across the country and throughout the world are heeding the call. Many are installing energy-efficient building systems, adopting efficient waste management techniques, instituting green building rating and certification systems, and marketing themselves as eco-friendly destinations.
It makes sense when you consider the data. A study by Mandala Research concluded that 60 percent of U.S. travelers had taken an eco-friendly trip over the past three years.
A Booking.com sustainability travel report indicated that 55 percent of international travelers are more determined to book sustainable, eco-friendly vacations than the previous year.
Attitudes are changing and that’s a reflection of the tremendous power millennials possess.
Millennials are willing to pay for truly valuable and one-of-a-kind experiences. They desire the new and novel, and crave the unexpected. They want meaningful travel experiences and demand the distinct and different. A study commissioned by Eventbrite found that 78 percent of millennials prefer to spend more money on experiences than on material things. According to the Eventbrite study, the benefits of opting for experiences is deeply personal. Eight in ten millennials said experiences help shape their identity and create lifelong experiences. Almost 70 percent said their experiences make them feel more connected to their communities, to other people, and to the world. Demand for new, unique and “experiential travel” is driving hoteliers to provide a more personalized, immersive, and adventurous environment for the millennial market.
A prime example is the trendy boutique hotel group, citizenM, which has properties in Amsterdam, Glasgow, London, New York, Paris and Rotterdam. The brand denounces now-defunct amenities such as trouser presses, bellboys and, in their words, “stupid pillow chocolates.” Even as a chain, citizenM works to give millennial travelers what they’re really looking for – a unique local experience. Similarly, Zoku is another one of a growing number of distinctive properties worldwide that have moved away from the traditional hotel concept and instead empowers guests to design their stay just the way they want it.
The truth is, hoteliers have only one option — adapt to this new world or risk becoming obsolete. If your property has not yet begun the social and technological transformation that is required of today’s hotels and resorts, not to worry. There’s still time to get started on your journey, but don’t wait too long. By 2025, literally half of all travelers will be millennials.