2020 has left the hotel industry in disarray. As countries continue to stumble in and out of lockdown, travelers are unable to make concrete vacation plans, and experts are predicting we may only see the return of international travel in 2023. Only 50% of hotels have been able to reopen in urban centers, and statistics show the tourism industry lost $1.3 trillion in export revenue in 2020.
This leaves many small businesses out in the cold: if this has been your main source of revenue, you may be wondering what you should be doing in the face of these dire statistics. However, there’s one industry that continues to boom.
Remote work has spread like wildfire in the past year, and people are starting to understand the freedom that comes with it - the remote employee can work from anywhere, and they’re not choosing the office. As HR departments begin to understand the overwhelming cost of unnecessary office space overheads, flexible work has become the norm, and studies show it’s here to stay.
Those who are now WFH are ready to harness the power of remote work and fly - but the hospitality industry is yet to catch up. The new generation of travelers want the option to stay for a long time, and their first priority is ensuring they're able to work from home. This is not a holiday house, it’s their office and their home. Typically, remote workers use AirBnBs to ensure they have a workspace and fast WiFi at home - something they do not associate with the hotel experience. What if hotels were able to provide that?
At Outsite, we’ve seen demand increase drastically in the past year, to the point that our Spaces are at capacity due to the demand. As a brand that’s been around since 2016, we’re trusted within this industry to provide the experience and community remote workers need.
We’ve recently worked with boutique hotels in Lisbon, Basque Country, and Mexico to transform their traditional hotel experience into desirable accommodation for digital nomads.
Let’s look at Santa Teresa, Costa Rica for example. When we began working with them, they had an old, dated hotel, frequented by North American tourists on summer vacation. In 2020 demand was completely depleted for traditional holidays, and they needed a way to continue their business.
Their beautiful treetop escape is the perfect place for a group of remote workers, in search of outdoor space, a fast internet connection, and the opportunity to really experience Costa Rica. In order to appeal to a new audience, our in-house design team renovated their Spaces at an affordable cost, and we were able to bring the property to market in 2020. The digital nomad world now knows about their incredible space in Costa Rica - the demand is so high that we have now added bungalows, and we’re adding 12 more rooms. This is not something a hotel can do alone.
In addition to this, hotel owners are seeing their net income increase. The ADR is decreased from the ‘norm’ to allow for extended stays, reducing turnover and associated operational costs. By offering a Space that is suitable for long term stays, guests are happier, and there’s less work involved in managing guests.
Coliving is a different market to traditional tourism. It’s a more autonomous experience by nature, and doesn’t succumb to seasonal demand: remote workers are not bound to 2 weeks of travel per annum, and they’re happy to travel throughout the year.
Considering that we may not see global herd immunity until late 2022, it’s time for hotels to take charge of their revenue for 2021. Tapping into the new market of remote workers and extended stays is the best way to make sure your business is sustainable from here on out, and Outsite is here to help.
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