Germany is the second most popular destination for European travellers. In the past seven years, the country has seen growth in travel above both the European and worldwide average, with 80.8 million overnight stays in the country in 2016.
Great Britain has long been the third largest European source market for Germany. However, with Brexit negotiations underway, the German National Tourism Office is now looking at new markets in Europe. Poland and Russia have proved strong inbound drivers, while Eastern Europe and the Balkan States are showing increased opportunities.
Germany is forecast to receive 121.5 million overnight stays by 2030, so these new markets will play an important role in marketing Destination Germany in the future.
Helping to achieve this is increased push for digitisation across the travel industry. Both the GNTO and the German Hotel Association (IHA) have identified the global significance of social media as part of the decision-making and booking process, while an integrated hotel experience is becoming vital to guest satisfaction.
We caught up with Christopher Lueck, Press Officer of the IHA, to find out what the association is doing to promote growth while regulating the sharing economy, and how new technologies will change hotel operations and guest experiences in the future.@GermanyTourism identifies tech integration as major #revenuestrategy challenge Click To Tweet
In 2016, the German hotel industry achieved a new record high with regards to overnight stays, while RevPAR increased by 3.4%. What fuelled this growth?
Germany recorded its seventh overnight record year in 2016. The hotel industry is benefiting from the robust economy and increased consumerism in the country, as well as from the continuing boom in domestic tourism. Germany is a long-term trend, and this is also due to its good price-performance ratio.
A number of new, international hotel groups have entered the market in recent years. Why do you think Germany is now attracting more brands?
There has been strong growth in recent years with the expansion of both international and national hotel chains. The international hotel chains have found Germany to be a growth market with sustainable prospects and one that enables them to pursue ambitious expansion targets.
The basis for this rapid growth is often due to multi-development agreements, along with a growing number of international hotels operating various franchisees for smaller sites.
However, hotel companies no longer seek growth just through new openings, but also through mergers and consolidation in the industry. Since the economic and financial crisis of 2008/2009, the formerly unspectacular German hotel market is today a highly attractive one through its reliability and stability. This leads to the fact that, especially in terms of investment, demand for hotel real estate has risen sharply for popular destinations. Today, more international brands are pushing into the German market.
What does this growth mean for small, local chains and independent hotels? Has the market become more competitive for them?
Uniquely, the German hotel market is characterised by individual private companies. At a time when products and services do not really differ in quality, consumers are increasingly looking for individuality. Soft factors, such as design and culture, as well as the creative connection of products and services, are becoming more and more important.
Megatrends reflect economy, sustainability and performance, but in this market, the company that meets the challenges of the current times with an individual and specialised concept, or product offering, has a real chance of success.
How has the introduction of disruptor services, such as Airbnb, impacted the hospitality market in Germany?
Clearly, Airbnb and the sharing economy is gaining market share. This is why, on the list of priorities of the IHA, the promotion of the direct distribution of the hotel industry remains a priority. Through the European umbrella association HOTREC, the German hotel association has started its “direct bookings” campaign to underline the advantages of direct contact between the guest and the host in the digital age.
However, with a view to the sharing economy, we demand a level playing field – that is, equal rights, but then also the same legal obligations for commercial private landlords.
The German market has been embracing digitisation. What will we see in 2017 and beyond in terms of new technology?
For the hotel industry, a major challenge is the integration of new technologies into existing infrastructures and flexible interchangeability.
Next, new technical standards and technologies in the area of information and communications, for example mobile devices and display solutions, and building technology and the networking of different mobile devices with centralised technologies for the construction – or property management systems – will play an important role for future-oriented solutions. This includes the processes of booking and check-in, but also the control of hotel services for guests and staff.
Technology always changes and it is important to be proactive and strategic. Guests expect hotel environments where they can use their integrated electronic devices seamlessly.
In addition to the suitable interfaces (sockets, connection possibilities to TV), the hotel’s Internet accessibility and services plays an important role. Hotel or other apps, their own website and targeted customer discussions over the Internet become a prerequisite for successful marketing and customer loyalty.
The real surroundings of the hotel will be a virtual space, which not only extends the guests, but benefits employees too.
Communication between guest and the employee will also change: new communication channels and new forms of interaction allow a targeted, individual and personal exchange with the guest.
RELATED HOTEL REVENUE STRATEGY ARTICLES
- Germany: Pricing Right To Drive ADR
- Revenue Strategy Report: Hotel Owners, Asset Managers Lead New Push For Innovation
- 6 Changes To UK Hotel Market Dynamics
Latest posts by Sarah McCay Tams, Contributing Editor, EMEA (see all)
- Leisure market continues to bolster Europe’s hotels for summer - October 11, 2017
- Germany: A Growth Market With Sustainable Prospects - October 10, 2017
- Germany: Pricing Right To Drive ADR - October 6, 2017