Are leisure travel agencies going to break into corporate accommodation?
Airbnb’s Brian Chesky summed up the mindset of the travel industry well when he said in May: “The lines between travel, live and work are blurring.
As someone who has worked in the corporate housing industry for many years, I would add that the lines have been blurred for as long as alternative housing has been offered to business travelers and mobile employers around the world.
A business traveler who chooses to stay in a furnished apartment rather than a chain hotel evokes much more the feeling of being at home in a place while working – especially if they are on an extended stay.
The rise of alternative accommodation and leisure activities
When Airbnb suddenly gained popularity in the 2010s, the world was alerted to a new way to travel. It was driven by the demand for alternative accommodation and driven by ‘experiences’.
This halo effect made short-term rentals desirable globally, and existing and new players in this space continued to benefit from this trend.
Now we have this new term “bleisure” used to describe the direct result of the pandemic on travel. People who were asked to work remotely in the past year have taken advantage and still do by mixing their “vacation time” with their “office time” and seeing more of the world while doing it.
In the future, it seems quite likely that bleisure will be here to stay given recent study found that over 20% of the workforce could work remotely three to five days a week as efficiently as they could if working from an office.
Long-standing demand for alternative accommodation and the recent boom in “bleisure” have now converged. This has created opportunities for players in the travel industry to broaden the appeal of their offering to leisure and business travelers, especially as optimism for travel continues to grow.
Catering for business travelers
All major OTAs had already implemented filters for “travel for work” – a no-brainer for reducing properties with out-of-the-box amenities like fast Wi-Fi or a desk.
Smaller accommodation brands are also making targeted inventory acquisitions and marketing efforts aimed at attracting business travelers: Sonder and Casai are two examples.
With record investment in travel startups this year, there will undoubtedly be more examples of growth and acquisitions in the space too numerous to list.
The offering of brands like Sonder and Casai is essentially the same as that of global hotel chains: standardization.
If you are at a Marriott hotel anywhere in the world, be it Baltimore, Berlin or Bangkok, you will have a similar experience and level of service. It’s no surprise that individual business travelers often turn to a particular chain they prefer.
Alternative accommodation companies bringing this to the extended stay market are proving that standardization is not incompatible with choice and experience (the two main drivers of demand for corporate accommodation).
However, consistency, or lack of consistency, is the number one reason that leisure businesses will struggle to break into the corporate sector.
When you rely on individual owners to set their own standards of care and facilities, each experience is out of control and different from the next, and standardization is impossible.
If a business is responsible for the well-being of its employees, the uncontrollable is not an option.
The barrier to entry: trust
What business decision makers want is to be able to work with providers they trust, as they will then give them some of the groundwork to handle the complex compliance and security issues in international travel.
This should involve complete control of the supply chain to make sure that everyone involved is someone you would like to do business with. Stress tests should be performed on the inventory, compared to a worldwide standard.
When you rely on individual owners to set their own standards for maintenance and facilities, each experience is out of control and different from the next, and standardization is impossible.
Lee Curtis – Reside
Throughout your stay, service should be professional at all times, with 24/7 support and maintenance. Easy access to dispute resolution and insurance coverage for business and personal policies are just two other standards you’d expect.
At Reside, our accommodation network has over a million properties in 60 different countries, but each meets the same standard of due diligence, such as following WHO guidelines for sanitation, cleaning and disinfection and a location-specific Global Health and Safety Score for each property. It is these processes that build trust between customers and guests.
When COVID-19 hit well-being, the safety and security of employees became the top priority and employers came under scrutiny to ensure the risks associated with these were mitigated. The business travel industry has taken up the challenge with enthusiasm. Improved cleanings, reduced touchpoints and geolocation were quickly introduced to restore confidence on the move.
Partnerships have been formed to provide clients with hyper-local data that enables them to make intelligent, real-time decisions about security risks from COVID-19 to women’s safety. Similar measures have also been adopted in the leisure sector of course, but frankly not to a similar universal standard.
This exam is unlikely to go out, it will just be part of the new normal. Business travelers should expect tighter restrictions at all points their employer can control and for a longer period than what we might see in the leisure industry, as they owe a duty of care to their clients. employees.
What this ultimately shows is that buying business travel is a bigger beast than just going on vacation.
Hosting companies that were “built for business” from the start, like ABODA and others, have this built into their offering and know what Fortune 500 companies want before they ask for it.
That’s not to say the industry won’t benefit from the incredible resilience and technological growth of the leisure travel industry that we’ve seen over the past 18 months.
Business travel has always caught up in this regard. The transition to business travel will be the hard part.