This is an ongoing series that identifies emerging commercial opportunities. We explore nascent and new behaviors that stem from periods of heightened change.
In this edition, we explore new opportunities for hotel brands amidst a changing travel and commercial landscape in China post C19.
DUTY FREE, WORRY FREE
The rise of new domestic destinations as global luxury shopping trip create new hubs.
What is it?
Create experience led retail spaces in lobbies and arcades.
As new infection clusters are quickly brought under control, the desire to go on shopping holidays is growing again with affluent Chinese.
People are missing their duty-free shopping fix the longer foreign countries restrict travel and China mandates centralized quarantine on inbound travel.
In an attempt to tap into this market, Hainan province has raised their duty-free allowance to RMB100,000 per person each year and retailers are apparently looking to offer 'made for China' limited editions.
- Partner with famous retailers (Selfridges) to bring pop-up shopping fair on property
- Use rooms and suites for fashion/ design trunk sales
- Partner with outlet duty free clusters globally and in Hainan
DELIVER LUXURY IN-HOME
Bring global luxury into lobbies and people’s homes as people look for ‘value pampering’.
What is it?
Extend hotel luxury into external services during this new period of travel confidence.
As travel becomes harder and people seek to save on larger expenditures, people still want to be pampered. Top rated hair salons and spas offer in-home services.
Ele.me recorded higher per basket expenditures as premium food outlets began to deliver in-home.
The Shanghai Shangri-La put their menu on popular food delivery services and made RMB 20, 000 in the first month.
- Use existing facilities to create new revenue streams
- Make F&B menu available on delivery apps
- Consider external services for masseuses, personal trainers, bar staff
CITY CULTURAL CENTER
Increase in weekend mini-breaks as a way to recharge and avoid stress of travel.
What is it?
Reclaiming hotel properties as centers of cultural activities to enable new discoveries.
Recent top destinations were Shanghai, Hangzhou, Suzhou, and Shenzhen. People want to stay closer to home and enjoy global luxuries in China.
Travel needs shift from European luxury trips to domestic pampering excursions.
Shanghai bar/restaurant Shake brought in Singapore’s Jigger & Pony bar menu while the W Hotel partnered with top food guides to bring celebrity chef weekend brunch menus.
The Edition Sanya hosted a South East Asia street food festival on premise. Hotels offer safe spaces for cultural consumption at a level of authenticity many Chinese tourists are content with.
- Import top travel destination food, shopping and culture into hotel lobby as proxy-travel
- Consider upcoming cultural festivals and how to replicate suitably within China
When travel is risky, family holidays need to balance wanderlust with homely comforts/ safety.
What is it?
Properties looking to refurbish should explore offering luxury amenities for families with kids (and pets).
Market needs and manifestations
Cleanliness standardization programs give hotels a major advantage over peer-to peer rentals, hotels that offer private villas and proximity to nature/produce are seeing a particularly significant uptick, given their seclusion and health credentials.
Yuluxe in Sheshan has seen an uptick in reservations by offering petting zoos and children’s beach activities.
The Kerry center with it 4 story play area for kids has done brisk weekend trade.
- Refactor play areas / kid amenities and nanny services
- Create and promote rooms and spaces that single families can rent out
- Offer natural and pastoral activities like fruit picking, farming and traditional cooking methods
CO-HOSTING WORK SPACES
Decrease in business travel and longer daily commutes creates need for new work spaces.
What is it?
Become the center of business activity and locus of deal making.
Market needs and manifestations:
Offer ‘third space’ working environments for freelancers, entrepreneurs or employees of large companies that either need more space than what home offers or people that might commute from suburbs to pack in 1-2 days of meetings and need more than a coffee shop to work from.
Iconic hotel properties are well-positioned to become more ‘grown-up’ co-working spaces.
International examples like Zoku in Amsterdam have developed attractive monthly / yearly memberships letting workers take advantage of their property for work. Forward thinking hotel brand The Hoxton initiated its Working From use of hotel space as working space in 2019.
- Rent out rooms during the workday for workers needing space, privacy and office tech
- Utilize public spaces for work related activities to create venue buzz and revenue
- Connect properties to create virtual meeting rooms for SMEs
- Blend and blur hospitality services into workplace innovations