Trends 2021

September Issue, 2021

Trends to Chase: How hoteliers can stay relevant in 2021.

The growth and change in APAC

The Asia-Pacific region was the earliest affected by the pandemic, and the hospitality sector in the region was inevitably, one of the earliest affected sectors. However, today, having used these early lessons to their advantage, the region is faring far better than anticipated.

This month’s trend article focuses on the steady recovery of the APAC region and the changes defining the region in 2021.

A significant turnaround

According to the Asia Pacific Travel Market Report 2020-2024 by Phocuswright, travel gross bookings in the region were predicted to drop by 58% compared to previous years. As drastic as the decline may seem, it was the smallest percentage drop among all travel market regions. Spurred on by the widespread vaccinations, Phocuswright predicts that the region’s travel market will reach its pre-pandemic levels by 2024 at most.

Despite the challenges faced, the APAC region showed a significant turnaround. Research by Hotel Business found that the region displayed consistent, although somewhat slow, growth over the pandemic years. By February 2021, the APAC region had marked nine consecutive months of profit, with February showing a 1.9% profit increase compared to the previous year. By March 2021, the region had achieved its first year-over-year improvement in GOPAR.

Since June 2020, the APAC region has maintained an above 30% occupancy rate, remaining above 40% for four consecutive months in early 2021. The region also managed to achieve revenue boosts through a 17.9% decrease in labour costs and a 14% reduction in total overhead expenses.

The rising popularity of investing in the APAC market in 2021 stands testament to its consistent growth. A study by the global real-estate consultancy, JLL, found that 70% of investors are looking to invest in the APAC region. Their study projected $7 billion hotel transactions in APAC by the end of 2021.

Features of the future

The most common theme around the globe, domestic travel picking up pace sooner than international travel, will continue for the APAC region as well. With international travel restrictions, along with vaccination and quarantine mandates still in place, domestic travel is far more convenient. The impact of the rising popularity of domestic travel is made apparent through China, which secured a speedy recovery, with domestic flight bookings recovered by 98% by August 2020, owing to their massive domestic travel market.

The other common theme is the increased importance of health and safety measures undertaken by hospitality organisations. An annual survey by found that 86% of travellers in Thailand will only choose accommodations with a clear health and hygiene policy. This was followed by 77% in India, 76% in China, 75% in Vietnam, 74% in Hong Kong, and 73% in Singapore and South Korea. These figures stood above the global average of 70% showing higher significance placed on health and safety in Asian regions.

The increased role played by online channels during lockdown periods has made OTAs more popular within the region. According to Google’s APAC Travel Survey, six out of ten consumers intend to book more regularly with OTAs, which is almost double the growth of direct channels. This is in stark difference to the global trend, where direct bookings saw a steep rise in December 2020. Google suggests that all travel companies could benefit from the OTA growth by providing safety and travel information across their channels and offering flexible booking options. Google also highlighted that innovative marketing strategies such as live streams could ensure that certain channels and locations stay on top of the consumers’ minds.

Understanding the fluctuations within the region will assist hospitality organisations in maintaining consistent growth within the APAC region. Encouraged by steady performance, organisations should continue their health and safety measures while focusing on the domestic market for continued profits.

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