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The Generational Challenge | Hospitality Edition

by Pol Bouratsis, Villa’s & VIP’s Coordinator

Achieving the ideal distribution mix has become one of the most critical challenges for any hotel, branded or independent. Sales & Marketing teams need to achieve the right distribution mix in order to increase the hotel’s revenues. However, the results of this distribution have also had a huge impact on hotels' operational teams. Depending on the guest demographics, what kind of vacation was booked (leisure, business, group, family, etc), and the way the booking was made (Direct reservation, OTA, Agency), expectations are extremely different. Therefore it’s becoming very important for operational teams, to analyze and understand guests prior to their arrival, adapt to their needs, and eventually achieve revenue increase by providing unique experiences to each and every one of them.

The main categories to be analyzed are:

1. Demographics (Generational & multicultural mix)

2. Type of traveler (leisure, business, bleisure, family, etc)

In this article, we will take a look at the differences between travelers' generations.

With the Millennials (born between 1980 – early 2000) representing the largest living generation, and the oldest of Generation Z (born between the late 90’s – 2010) starting to get their diplomas & financial independency, hotels need to take a look towards the future and adapt their internal organization in order to appeal to their future guests. The research published by Allied Market Research estimates that by 2025, Millennials will represent over 3/4 of the global workforce, which will bring them into a new era of spending power.

What are Millennials & Generation Z looking for

  1. Digitalization: Services & information that are easy to find and book

  2. eReputation: Well–represented and reviewed services on third-party sites (TripAdvisor, etc)

  3. Local: Explore a destination by living like a local

  4. Personalization: Have the option to personalize their experience on the go

Those two demographics approach different social media and connectivity. In fact, they are mostly looking for social content instead of social networking. Especially Generation Z could be defined as “curators’’ as they want to contribute to the conversation and be a part of it. However, at this time, Generation X (born between 1965 – 1980) represents the demographic having the most buying power and financial freedom, while the Baby-boomers (born between the mid-1940s – mid-1960s) are shifting away from the traditional relaxation vacations and are looking more for secured – adventure and socialization experiences.

What are Generation Xers looking for

  1. Quality: The ability to relax and unwind through nicer hotels & amenities

  2. Guest – mix: Family or group–focused options

  3. Connection: The option to work while on vacation

  4. Flexibility: Plan their trips further ahead

Generation Xers are the ones that today combine high buying power, as they mostly are in the apogee of their careers, and connectivity needs (this generation is the one credited for huge advancements in technology and communications we enjoy today, such as Wikipedia, Google, Amazon and many other). As a result, they are making well-informed decisions.

What are Baby – Boomers looking for

  1. Secured Adventure: Step out of their everyday life

  2. Family: Spend time with their loved ones

  3. Socialize: Meet people through activities

  4. Personalization: Personalize their experience depending on their capacities and abilities

Unlike what one could think, only 38% of Baby – boomers are looking for relaxation & rejuvenation trips. It seems that 65+ people are wanting to socialize and carve out some time for adventure.

As we can understand, guests' expectations and spending patterns depend a lot on their origin and generation. By understanding those patterns, a hotel can target guests and make adequate offers in order to increase significantly its revenue.

In order to do so, hotels need to build a model that will accompany this generational transition. A model with the right human and technological balance in order to apply personalization in mass.

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