Predicting the unpredictable: how can operators deal with global events?

After Covid, operators are well aware that travel plans can change in hours. Emma Lake looks at how businesses prepare for the unknown

In the past two years inbound tourism has been impacted by global conflicts, climate-related events and economic uncertainty, all of which have proved a challenge to hospitality operators. But these events could bring about a long-term shift in how and when guests choose to travel, so how can businesses learn to cope in an increasingly unpredictable world?

“We’re in an era of perma-crisis,” said James Wood, regional security director at international health and security risk management specialist International SOS. “We move from one crisis to another or see the layering of multiple crises happening at once.

“[For travellers] there’s always the exposure to traditional risks such as petty crime, road traffic accidents or gastro-intestinal illnesses, but now there’s also a perception of heightened risk, and that is one of the enduring challenges organisations and businesses have to tackle.”

The impact of a crisis or event on tourism and the wider hospitality industry can be difficult to predict. Joss Croft, chief executive of travel trade association UKinbound, said major global events of the past had unexpected consequences: “Each geopolitical event has a different impact. In the 2000s we had 9/11 and the outbreak of foot and mouth disease, which affected inbound leisure tourism, but business travel continued. The global financial crisis in 2008 saw business travel drop massively, but leisure travel continued to grow.

“The decision to leave the European Union also had some unintended consequences. Removing national identity cards as a means of travel has had a massive impact on youth and student travel into the UK, and in 2022 it was down by about 86%. When people voted for Brexit I don’t think they imagined it would stop Italian schoolchildren coming to the UK, but that’s the impact it’s had.”

Since February 2022 the Russian invasion of Ukraine has had varying consequences for tourism in the UK. The impact on fuel and food costs has increased the price of travel and the closure of airspace over Russia to British couriers has meant longer flight times for those travelling between the UK and China.

There has been an assumption that the American market can be particularly sensitive to geopolitical events, but Croft says travellers from the region have become savvier in recent years: “In previous years during the conflict in the Balkans and the Gulf War, Americans were put off travelling, but they’re much more sophisticated travellers than they used to be.

“The main drivers for international travel are to do with value for money and whether it’s a welcoming destination. For American visitors we’re seen as welcoming – we have a common language and we’re seen as safe – so that benefits us.”

Cautiousness during Covid

The biggest disruption to the industry in recent years was the Covid-19 pandemic, which brought international travel to a grinding halt. Adrian Ellis, general manager of the five-AA-star Lowry hotel in Greater Manchester and chair of the Manchester Hoteliers’ Association, said the crisis had forced operators to adapt and reassure guests as they returned.

“All of us were living and learning; we had no experience to relate to,” he explained. “In the beginning we had a lot of conversations to reassure guests, particularly around events. We didn’t want people to come to their first event in two years and think they would fall ill straight afterwards.

“I don’t remember any dramas, but people were naturally cautious. I think it was a year of people feeling cautious. After a year there was a relaxation on rules around Christmas 2022, and there were certainly no signs of caution around Christmas 2023.”

Wood said a long-term impact of the pandemic was a new focus on health-related factors in risk management. The outbreak of Covid-19 also showcased the growing impact of misinformation on people’s travel plans.

“Part of our work is to look at how to understand the reality of risk environments in the locations businesses are sending people to,” he explained. “One of the enduring challenges is navigating misinformation and disinformation, which are hugely prevalent and have been accelerated by the pandemic.

“Information has almost become politicised and weaponised to a certain extent. The challenge is around how people can gather information, use it and verify it. These challenges are not going to go away in the short term.”

 

“We’re in a period of caution across the world while we wait to see how things pan out”

Ellis said hotels could help counter this and were well-positioned to offer reassurance to guests. He said teams were trained to offer guidance when areas of concern arise, and that hospitality and travel industry bodies have systems in place to liaise with authorities and work together in the event of a crisis.

He added: “We’re very good at coming together. The group here in Manchester is very collaborative. If something like the Manchester Arena bombing happened again, the Manchester Hoteliers’ Association would be on a call to the authorities and would be able to advise members about what’s coming from the government.

“We would organise the call, but I wouldn’t be giving the advice – we’d invite someone from UKHospitality, the government or the city council, whoever is appropriate, to explain measures.” The unpredictable nature of climate events can also have long-term consequences. For example, the soaring summer temperatures and wildfires in Europe in 2023 could lead to a shift in when people choose to travel to certain destinations, explained Wood. And after a turbulent few years, operators of travel and hospitality businesses may well be cautious about planning for the future.

At the Lowry hotel, Ellis said the team felt confident about dealing with health-related issues, but were still wary of economic changes.

“We’re always going to have this rollercoaster ride where there’s a period of stability and then we go through a rocky patch,” said Ellis. “We’ve gone through several years now where it’s not been too stable, with lots of things going up and down. We’re in a period of caution across the world while we wait to see how things pan out.

“We’ve learned a lot from the pandemic, so we feel prepared for things that are health-orientated, but in terms of economic changes we maintain caution.

“In terms of recruitment and cost management we have a just-in-time approach to looking at costs in case there’s a dip we couldn’t foresee. It’s a more cautious approach to everything.”

The five Cs: a crisis management checklist

Petra Clayton, chief executive of hospitality marketing agency Custard Communications

With any potential crisis it’s impossible to plan for everything, but having a communications framework in place will help. It’s important to recognise and appreciate who you are speaking to and understand that communication needs to change between audiences.

We follow a simple rule of the five Cs: Clarity, Concise, Conviction, Compassion and Competency:

Clarity

During a crisis you need a clear message, but you also need a clear communication channel to extract information, so you know exactly what’s happening and when. Facts are critical so ensure you work hard to get these and have a system to monitor updates. Personalising your communication to each audience depending on the impact will ensure you are seen as delivering relevant updates.

Concise

Don’t use jargon, just key, factual, informed statements, which must be delivered in a timely manner. Monitor reactions and feedback and keep adjusting your message to cover questions or concerns.

Conviction

You may not be the expert on the issue, but you will need to be firm in what you are doing and why you are doing it, so explain it with conviction. Your role is to offer reassurance, so never speculate, don’t make promises you are unsure of and know what you can say legally.

Compassion

A crisis can be hugely emotional, so while you are presenting factual, concise messages you need to be sensitive to the issues. Always put people first in statements – this is about them, not you. Ensure you are accessible for questions. You need a channel for open dialogue and reassurance.

Competency

The message sender is key to providing credible communication. You need to manage the flow of information internally and externally, so appoint key people to be responsible for managing all layers of communication.

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