It is difficult to talk about travel these days without mentioning the looming effects the global pandemic has had on the industry.
One might assume that the biggest threat to the luxury travel sector right now has something to do with lockdowns and strict border policies, but we see this as a temporary issue. What we are pertaining to, is a larger threat in the form of a trend that is currently occurring, that has the potential to affect global luxury standards in the long run.
Due to the high demand, luxury travel is starting to find its stride again, but guests are finding that they are paying more for less in 5-star hotels. Here’s why.
Sub-par service and sky-high rates are a risky mix.
It is hard to blame hotels for increasing their rates of course. Five-star hotels that have barely made it through 2020 can potentially make up for their losses over a year by hiking their prices to meet the surging demand for the upcoming season. The demand is high for luxury travel, there is talk that the extremely wealthy have managed to add more to their net-worth over the pandemic and about half of them are intending to splurge on what has been dubbed as “revenge travel” this year.
This brings us back to the recurring issue. Overcharging and under delivering poses a long-term threat to the luxury sector’s reputation that could be far more damaging than the challenges of the last year or so.
Rates haven’t rebounded, instead they have soared. It’s a problem looming large in the luxury travel industry, which is seeing profits surge while it still struggles to return to pre-pandemic service levels. Those that indulge in luxury travel experiences are not price sensitive, but they are highly service sensitive. We can all agree that lavish service is the biggest lure for high-end travellers. In the past, five-star hotels could impress guests with their tasteful decor and amenities, but the super wealthy now live in homes that can match a five-star hotel’s physical grandeur.
The alternative approach taken by independent hotels.
We are not saying that all luxury hotels have succumbed to the temptation to increase their rates or hide shortfalls to bounce back from losses over the pandemic. We’ve seen that independent hotels like family run luxury properties have taken a different approach. Owner-operated properties are likely to think long-term, wanting to retain guests for 2022 and beyond, and acting accordingly.
For smart travellers, then, 2021 is the year of the independent property. Wherever you decide to go this year, it is a good idea to keep an open mind. If a property maintains rates and gives candid warnings before a stay, travellers should respond with grace and patience. Luxury travel in 2021 should involve expectation-setting in this new environment.
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