Alta blog

Alta Thoughts (August 2023)

By Rakesh Patel

Having spent the summer in the UK and Europe, it is fascinating, frustrating and frightening to observe some of the dynamics and challenges around the travel industry in the region.

The cost of travel has certainly risen sharply. Anecdotally, hotels owners tell me they are seeing the highest ADRs ever, and the latest STR data evidences this. Airfares are also rising, up 36% yoy in May, as airlift supply issues remain. And for the UK, airport and airline strikes add to traveller angst.

The conversation around over-tourism is back. This matter was the source of much anger from locals in tourist locations pre-pandemic. After a pandemic pause, local governmental restrictive actions are back in some European destinations.

Lastly, there have been shocks, with extreme weather in places like Greece, leading to devastating fires and evacuations.

Despite all this, the evidence suggests that travellers are still willing to absorb these trials and tribulations for now, as they prioritise travel, services and experiences, over goods.

Below are a few of our recent thoughts posted on LinkedIn. As always, good to hear your feedback and exchange ideas. You can follow us directly on LinkedIn and go to our website.


Tourists are back. Is it time to tell them to stay away?

With tourism numbers ballooning again, the subject of overtourism is back on the agenda. Whilst the economic impact from the recovery in tourism is welcome by the hospitality industry, not everyone is happy, particularly local residents and governments.

But can you really curb tourism, especially with a burgeoning global travel class, and still maintain a positive economic impact? According to the WTTC tourism accounts for over 10% of global GDP, supporting local employment and business, and helping to finance the preservation of historical sites.

Balanced solutions are hard, but tourist destinations are trying. Raising tourist taxes, focusing on “quality” tourists, “spreading” tourist visitors, or more radical degrowth plans, have been implemented with mixed results. Clearly there is no easy answer to a challenge that is only going to get harder.


Hospitality sector key to the delivery of “S” in ESG

It has always been more challenging to define the “S” is ESG, and then how to measure it and assess progress. As a consequence, the “E” and “G” garners more emphasis. Yet for the hospitality sector, a fundamentally people business, having a positive impact on the “S” could not be more important.

The “S” factor in the sector encompasses how the business positively manages its relationships with its employees, guests and customers, supply chains and the wider community. Given the tourism industry employs some 10% of the global workforce, it can have a significant positive impact for business to deliver on this.

And from a business perspective there are advantages including a greater appeal to more ESG-conscious customers particularly amongst the younger customer base, improved recruitment and retention of staff, and better guest reviews and repeat business.


The hotel of the future

  • Digitalisation – streamlining processes and using data to customise, are part of embracing the digital age in hotels
  • Putting guest experiences at the core of the offering – it’s what the younger generation/future spenders seek out
  • Sustainability is a non-negotiable from the build to the operations – the shift is from a nice to have, to a must have
  • Attracting the right talent – it’s a people business and it can be hard work, so create the right employee environment