Recently I was on the panel for RevenueHACKS, discussing the importance of the local market in 2021. What struck me afterwards was not just how important the local market is, but how it always has been and always will be. Locals can be your ambassadors. They have short travel time, can book on the spur of the moment all year round, and will often focus on the total hotel experience and not just a place to rest your head while you explore the city.
At the beginning of the pandemic I participated in regular “COVID chat” calls with my alumni of Shannon College of Hotel Management. One week, we focussed on the difference between the current crisis and the economic recession in Ireland in 2008. The initial reaction was that this time, we can’t escape. During the recession, many Irish moved abroad to start new lives and are now known as the “Diaspora”. Now international travel is heavily restricted which also means that the local market need to turn to local destinations to “escape”. Also, the economic recession was just that, a recession. People held onto their money and in turn the hotel industry suffered greatly, seeing cancellations and scale-downs. We see a similar pattern in the pandemic but while some business have been shattered, others have thrived or adapted to the new normal. This may be more so in Sweden where we haven’t closed business, and therefore the local market is restricted from international travel, with money to spend and desperately in need to escape.
One of my main observations is that the “fear” of travel is not as prevalent as we once thought. While restricted, most offices, shops and restaurants have remained open meaning that Swedes can carry on with their everyday lives with limited socialisation. As a result, there are clear peaks and troughs from the Swedish Staycation market as people are desperate to celebrate anything they can. For hotels and restaurants, it is challenging to quickly arrange operations to handle such a quick pickup, not to mention quick changes in restrictions.
I believe that those who already have a strong brand equity in the local market are the clear winners as a loyal guest base already have a sense of belonging to the brand and are willing to spend a more to support the brands that they want to see more of when we get through the pandemic. And when we do get through this, the local market should not be forgotten as they can provide a quick pick up all year round that is more cost-efficient than other sales channels.