The increasing interdependence and connectivity of foreign markets and economies over the last 25 years, according to Bharwani and Butt (2012), demonstrates the globalization movement sweeping the globe. The services business has been at the forefront of this global economic transition, with significant development in the travel and hospitality industries. According to Terrero (2009), the globalization revolution has unleashed the global hospitality industry’s future economic latency. As a consequence, multiple confrontations have arisen in the hospitality sector’s organizational fields, such as HRM, cross-cultural communications, and marketing strategy. These difficulties have forced service-oriented businesses to adopt policies that will allow them to provide programs that will have an effect on consumers, resulting in the development of healthy organizational-customer relationships. If these partnerships are well-maintained, they will evoke consumer satisfaction and preference, giving the company a competitive advantage (Terrero 2009).
With the contemporary issues that arise from the competitive environment of the hospitality industry, this essay will outline some of the modern themes that have penetrated the market as strategies to improve the customer relationship and establish competitiveness. Additionally, some challenges will be identified, with discussion of some steps that can ensure that these obstacles can be overcome.
Even though superlative services provided is constantly at the hotelier forefront, both the hospitality education providers and the hotel industry are responding to transformations in the contemporary consumer and market trends (Laskarin, 2013). This has led to development or embracing of different elements in order to tailor their services and products to what fundamentally matters to this novel customer generation. The following is a discussion of three contemporary themes that have been embraced by the hospitality industry in an attempt to maintain competitive positions.
Social Media in the Hospitality Industry
Withiam (2012) highlights that the easy internet accessibility and the augmenting recognition of social media amid tourists have opened extensive prospects to impact travel decisions. Above 75% of tourists, search the social media to attain travel-related review and information prior to purchase and hotel bookings. On the other hand, 32% of the tourists do not book or purchase travel accommodations with no reading reviews first. Mihaiu (2013) outlines that realizing the escalating latency of social media, the hospitality industry is now influencing travelers on search platforms and competition inside the social room, a practice that has turned out to be more powerful. This is with the establishment of novel platforms for instance Google Plus. Moss (2011) agrees that with regard to a survey performed by Hubspot, the current most widespread platforms marketers apply YouTube, blogs, LinkedIn, Twitter, and Facebook. Of these platforms, the most extensively applied by hospitality marketers are YouTube, Twitter and Facebook to increase bookings and promote search. Hotels that score greatest in social media commitment comprehend the wants of the novel generation, which involve instant satisfaction thus; they are continually reacting to responses in a distinctive and non-corporate method (Mihaiu, 2013). When this is merged with recompensing the guests with invariable deals and incentives, it acquires more followers and supporters on the organization’s social media platforms.
Personalization in the Hospitality Industry
Currently, personalization is compelling hospitality organizations into a shift of mindset from producer-led fragmentation to consumer-driven preference (Hotels 2020, 2012). Much has been developed currently of the consumer desire to go above material goods acquisition for a personalized experience and for that individual consumer to be major contributors in its delivery and design. While the earliest generations developed with high personalization levels in the 1960s, standardization and automation became a common element in the 1990s. Hotels 2020 (2012) postulate that the mobile phone and internet have offered a fresh leaf to the agenda of personalization. The internet acts as a source of choices while the tablet PC’s and Smartphones offer a method of access. These developments offer a way of satisfying an augmenting individualism culture, reinforced through growing personal wealth particularly in developing countries. This has become demand by the western consumer already. For instance, in a survey conducted reveals that by the year 2020, guests in hotels will anticipate a personalized stay, picked from a group of choices starting from booking time to arrival points (Hotels 2020, 2012). This drift towards extreme intensification begins to challenge and probably restrict the worth of conventional segmentation advances while exerting greater stress on the model of a service spectrum that is focused on the customer (Hotels 2020, 2012).
Creation of Loyalty Programs
Laskarin (2013) identifies that in the very start when loyalty agendas were being created; hoteliers mainly took part as airline company partners. Nevertheless, once they identified the obvious several benefits that airlines were achieving, hoteliers starting to customize their individual loyalty agendas. The loyalty program notion is to create a harmonization between the wants of guests with the rewards provided to them (Laskarin, 2013). It also entails identifying other program associates whose services will also be applied by the guests. The development of loyalty programs by hoteliers has emerged from the augmented fierce competition existent among organizations in the industry. Therefore, it prompted the need to invent premeditated preconditions for dealing with information regarding the hospitality consumers. Additionally, current information technology advances have offered the necessary tools needed for marketing managers in hotels to develop a novel generation of Customer Relationship Management (CRM) approaches (Laskarin, 2013).
Currently, when utilized in markets with mass consumers, these programs are frequently recognized as being components of the promotional tools of the marketer’s repertoire. Additionally, they promote repeat purchase instead of attitudinal commitment, an aspect that pinpoints short instead of long-tem association orientation. Evidence from Laškarin (2013) demonstrates that hotel corporations that have transitioned to become branch leaders have long since devised guest loyalty programs.
Challenges in the Hospitality Industry
With the realization of contemporary themes that can be applied by hoteliers to set them apart, come different challenging trends that have become a central issue for hospitality professionals (Carmona, 2012). This section includes a discussion of two trends that continue to be hindrances of hospitality managers, particularly from a human resource viewpoint.
Global Expansion (Trend 1)
To obtain the gains derived from economies of scale as well as accomplishing a fundamental mass essential to maintain economic feasibility, it has become necessary for hospitality companies to enlarge their geographic footprint internationally (Bharwani & Butt, 2012). Hotel organizations with a moderately extensive global properties portfolio are better prepared to attend to the wants of the modern world traveler whose leisure and business pursuits progressively traverse global borders. Considering the above, numerous global hospitality chains have tried to maximize on increasing stipulation in high growth economies for instance India and China where annual tourism growth is anticipated to be in any case equivalent to, if not above Japan, France and UK by 2015 (Bharwani & Butt, 2012). Taking consideration of the potential for hospitality segment growth in India, numerous leading global hospitality chains for instance Resorts Worldwide, Starwood Hotels, Marriott and Four Seasons have penetrated the market, especially in the current past.
The figure of globally recognized hotel brand is anticipated to augment five-fold at the millennium threshold. In fact, the annual years 2009 and 2010 experienced the greatest figure of hotel openings, particularly in India. On the other hand, while there is continued increase of brand recognition, apart from attending to the western inbound business and leisure travelers’ accommodation requirements, the forthcoming expansion of global hotel brands in growing markets focuses on developing brand loyalty and recognition (Hotels 2020, 2012). This is expected among the domestic populace of the involved nations, who are anticipated to be among the greatest outbound traveler groups internationally in the near prospects. Hoteliers must sustain their competency standards as a result of global expansion by ensuring that they meet the expectations of any guest. This is bound to elicit both negative and positive feedback. It is the role of the human resource managers to ensure that there is capitalization of the positive feedback in a bid to reduce any negative feedback (Bharwani & Butt, 2012).
Developing Patterns of Technological Developments and Consumer Demand (Trend 2)
Globalization has been influence greatly by technological development, with the benefits that have been connected to the capabilities an organization to apply technology to attract consumers (Terrero, 2009). Furthermore, in the contemporary scenario of intensifying competition and increasing globalization, organizations are continually endeavoring to transform their value proposition in a bid to sustain their competitive advantage. A paradigm shift has occurred in the means through which the economic value is recognized across all forms of organizations but especially in the hospitality industry. According to Mihaiu (2013), with the progressing commoditization of services and goods, “experiences” have appeared as the subsequent bridge in the economic value progression. Research offers a relational, emotional and sensory link to the product or service offering, well over its simple functional value. The modern global traveler has turned out to be progressively distinguishing and his consumption preferences have become qualitatively additionally diverse.
The modern guests dynamically look for customized, superior-quality yet reliable hospital experiences, which incorporate a gentle culture-specific originality with a certain approvable product quality and service level (Mihaiu, 2013). Therefore, in the perspective of the developing experience economy, hospitality organizations are making intensive efforts to enclose their conventional service offerings of boarding and lodging in particularly developed, appealing experiences to develop lifetime reminiscences for their visitors. It has turned out to be necessary for employees in the hospitality industry to acquire a comprehensive understanding of the transforming customer requirements and expectations to allow them to customize and deliver novel and superlative experiences, which reverberate with travelers on an emotional and personal level (Bharwani & Butt, 2012). Therefore, the human aspect in the hospitality organization is the secret ingredient in enhancing consumer experience-centricity in hospitality companies. Front-line employees and managers play a principal function in consumer interface and the needed skills set by them in the transforming strategic and operational landscape wants to be revised. Technological development has also resulted in supply and demand changes. A higher stipulation for individualized and flexible options and information quality has personalized tourism and leisure behavior, an outcome of augmented ICT utilization. Bharwani and Butt (2012) add that since there is continuous technological development, hotels have to step up to ensure they implement strategies that are not applied by their competitions.
Resolving the Hospitality Industry Challenges
With the assumption of being an industry executive, different measures can ensure that the negative impacts caused by these challenges are mitigated to avoid loss of consumers (Withiam, 2012). In this case, the following measures would be the best strategies to handle the challenges.
Diversification of Hospitality Products and Services
Carmona (2012) stipulates that all sectors of modern tourism are self-motivated and cause to experience evolution and change just as the occurrence of globalization. However, dynamic transformation is nothing novel to the hospitality industry and has been experienced over the years. With globalization come changes in the preferences of consumers, since it involves moving from conventional to contemporary forms of services and products (Hotels 2020, 2012). In this vein, organizations must be prepared to offer consumers products and services before they even think about them. This creates a strategy through which the consumer demands are created and met in a bid to make their travels more memorable. Since the industry is developing globally and is becoming extensive progressively in the service and product range it provides its customers, the hoteliers must ensure that they evolve with multi-activity and complex resorts. These resorts are expected to function inside the conventional hospitality while ensuring that the product diversification is reflected through a range of sports and leisure activities, conventions, conferences, travel, retail, and gaming (Hotels 2020, 2012). Within such resorts, management and ownership may be located inside one organization, although they may also embody a mixture of dedicated service suppliers. These comprise of premium branded names. Considerations in the workplace would be greatly influenced by these deliberations (Carmona, 2012).
Impact on Human Resource Development, Skills Development and Qualifications
New hospitality productions and diversification are largely influenced by changes in the demographics. A growing trend inclined at the hybrid and new occupations is evident, revealing the new product nature provided through the market (Withiam, 2012). Additionally the increasing function of ICTs is also seen. Consequent of such transformation, a generation of technology-literate and better-informed consumers could gain from ICTs to look for more environmentally friendly and sustainable destinations. With these stipulations, the hoteliers must be able to plan on how to ensure that the skill requirements and new knowledge expectations in the sector are met (Mihaiu, 2013). The answers to these concerns may lie with different strategies such as outsourcing or revising their recruitment and staffing policies. This would ensure that employees are updated on the new demands on skills. Certain employees are able to adapt to multitasking readily while others face challenges in creating this transition.
The hotel managers must ensure that they do not jeopardize the brand of the organization by assigning responsibilities to employees who are not sufficiently trained. This is because consumers currently expect highly motivated and qualified employees, continuous training, and skills development is expected and essential in all segments of the sector (Carmona, 2012). It is evident that the skills needed in the hospitality sector are transversal for instance ICTs, customer orientation, language and communication. Worker abilities development through quality multi-skilling, training, education and the effect of lifelong learning act as significant in aiding employees to perform superlatively in their jobs
The contemporary era has prompted the hospitality industry to employ up to date themes that can ensure a competitive edge. The contemporary era has also been accompanied by globalization, which has prompted the continued expansion of the industry. Globalization therefore, stipulates strategic responses from the hotel management and industry in general. Some contemporary themes identified include social media evolution, personalization of the consumer needs and establishment of the much needed loyalty programs. Social media has been at the forefront of enabling the hoteliers to identify the needs of the consumers through different information and ratings that can be traced on the internet. The biggest hotel brands have been keen enough on the responses of the consumers in the social media podiums. This has led to customization of the consumer needs in order to ensure that an emotional and sensitive relationship is created by the organization and the consumer. Loyalty programs have enabled the hotels to harmonize between the guest wants and the rewards offered to them. However, with these trends come challenges such as global expansion and augmenting technological developments and consumer demands. To reduce these challenges, the hospitality industry has to ensure that the workforce given the responsibilities is proficient enough, while the hoteliers create strategies to deliver a diversified range of services.
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