Coronavirus has created a period of reckoning for hotels

The turn of the year had the travel, tourism and hospitality industry in a fairly comfortable place.

The leisure and business travel segments were expected to enjoy their ongoing growth trajectories, helped by a healthy ecosystem (for the majority) that had competition between airlines, accommodation providers and intermediaries.

The marketplace for accommodation, in particular, was learning how to handle the desire by consumers to experience both the traditional hotel-type offering and private rentals.

The major online travel agencies (and countless platforms, such as Sonder, which have sprung up in recent years) had realized that to meet that consumer demand they had to become true platforms with a more diverse inventory including hotels, B&Bs and guesthouses.

But the outbreak of the coronavirus has, as we all know, brought into sharp relief just how delicate such ecosystems can be.

What is now perhaps remarkable, ten months into the pandemic, is how wrong early suggestions for a recovery could be.

Some believed that hotels were in a better position to seize upon whatever form that recovery might take, due to the strength of their brands and ability to reassure guests that they had tight hygiene and coronavirus-related regimes in place for those getting on the road once more.

Private accommodation, on the other hand, was a relative Wild West of standards and possibilities in that regard for those venturing out.

It didn't turn out that way.

The accommodation flip

Within weeks of Airbnb talking about how the initial phase of the outbreak had nearly broken the company ("travel as we knew it, is over - and it's never coming back," CEO Brian Chesky said), things had shifted considerably.

Online travel agencies were stating in the round of second quarter earnings about how their rental divisions were coming back faster than their hotel segments and Airbnb (and others) were noting a high demand for properties.

This trend is apparently continuing. And it leaves hotels in a tricky spot, to say the least.

Business travel - the life blood of thousands of properties - remains a segment with huge challenges, as companies continue to put corporate trips on hold.

This means that the pre-pandemic fierce yet healthy competition between hotels and rentals for the leisure traveler is now more acute than it has ever been.

This is not to say that hotels are unable to rise to the challenge (they did a decent job of showing their worth as the supply of private accommodation started flooding the market in the mid-2010s), but their means to do so are going to be difficult to navigate.

Touchless technology will play a major part in their efforts to bring some degree of confidence to potential guests ahead of a stay, but they will also need to throw away some of their age-old practices, too.

Collaborative digital marketing with destinations and attractions is one area to consider. Greater flexibility around cancellations and refunds is another.

And, perhaps somewhat ironically given the drive for direct bookings, a shift back towards working closely with their OTA partners to showcase the proposition of the hotel market and reach for volume.

OTAs, no doubt relieved with their efforts in recent years to embrace the private accommodation market, will undoubtedly welcome this move.

Sessions to catch at The Phocuswright Conference 2020: