The industry is also overly reliant on the Explains that the hotel industry is capital intensive with even small, independent hotels facing substantial . Did you know that you should never put your back to a Buddha? Hotels However, most of the world is now free for travelers and thus the hotel industry is facing a massive boom. industry, otherwise known as the hospitality industry, spans across a large If they dont, they may find themselves on the receiving end of scathing reviews online, lack of customers because of environmental issues like the weather, or into legal trouble like if hotel owners were to violate innkeeper laws. These are two examples of cultures which have remained unchanged for the sole purpose of tourism. Financial supports and other initiatives from governments play a big role to promote the hospitality industry. On these sites, they can read reviews and past commentary of previous patrons. This is further fueled by social media platforms where people are able to exchange their experiences and thereby create peer pressure to travel. Views expressed are personal and do not reflect the official position or policy of Financial Express Online.). Ethical considerations would typically be included in the Social and/or Political areas, depending . Labor laws include age and sexual discrimination, immigration enforcement, ADA compliance, and increased cost of labor. Uber Eats, Just Eat, Hungry House, and many other apps have enabled people to order their food instantly and receive the delivery with a very short time. Overall, the tourism industry is influenced by a complex interplay of economic, political, cultural, social, and natural factors. Copyright 2017 2025. Unfortunately, there are many changes that come about as a result of tourism that are not desirable. Any small step taken by the government bychanging some law it would seriously affect hotel industry . Now its all chains and multinational corporations. Our General Mills SWOT Analysis examines internal and external factors that impact the company's operations, What is root cause analysis, the goal, and why is it important? The Airbnb (2020) Make the most of the growing demand for longer stays, available at: https://www.airbnb.co.uk/resources/hosting-homes/a/make-the-most-of-the-growing-demand-for-longer-stays-263 (accessed 22 April 2021), BBC (2020) Marriott Hotels fined 18.4m for data breach that hit millions, available at: https://www.bbc.co.uk/news/technology-54748843 (accessed 25 April 2021), Condor Ferries Ltd (2021) Hotel industry statistics 2020/21, available at: https://www.condorferries.co.uk/hotel-industry-statistics (accessed 24 April 2021), Style, T. (2019) Where will the UKs new 130,000 hotel rooms come from?, available at: https://www.savills.co.uk/blog/article/288955/commercial-property/where-will-the-uk-s-new-130-000-hotel-rooms-come-from-.aspx (accessed 24 April 2021). Hotel owners who are confident that their hotels This article shares his insights into the impact of coronavirus on the hotel and leisure market, together with views discussed at the conference. Developing countries like India are expecting a growth in travel and tourism at over 7% annually and the story is similar in other parts of the world. Social Factors: Following are the social factors impacting Hilton PESTLE Analysis: Hilton hotels brand is very well known among international visitors. Bleisure travelers & hotel work spaces. We are losing our individuality and gaining a sense of global being, whereby we are more and more alike than ever before. Museums, shows and galleries are fantastic way to showcase the local customs and traditions of a destination. 7. weather in the local area is the deciding factor for whether someone chooses to President with new ideals can swiftly impact the hotel industry, and overthrow There is likely to be economic inequality between locals and tourists who are spending more than they usually do at home. Economic factors that benefit the hotel sector include near-record-low unemployment, strong job growth and increased labor-force participation, as well as continued Baby-Boomer and Millennial. There are different ways with which governments can influence the hospitality industry. Tourism can see rise to many commercial business, which can be a positive social impact of tourism. for centuries. Political and Security challenges. The strength and weakness of currency can 2. The ultimatetourismglossary, 50 fascinating facts about the travel andtourismindustry. This detailed PESTEL analysis of the hotel industry aims to evaluate some of the macro factors that influence the global hotel industry, with particular references to the USA, the UK, and the EU. This text by Hyung You Park explains the principles of heritage tourism in more detail. Also, graduated from Leeds Metropolitan University with a BA in Business & Management Studies and completed a DTLLS (Diploma in Teaching in the Life-Long Learning Sector) from London South Bank University. Hopefully, this 1. are now being put under a lot of pressure by both governments and environmental I am going to explain how different factors can affect the industry as in positive as in negative way. Contact Us | Privacy Policy | Terms of Service, Kotlers Five Product Levels Model Definition,, What is an Augmented Product? Sure, give the tourists that sense of familiar that they are looking for. He holds an MSc in Tourism & Hospitality from the University of Sunderland. What it needs is smart people, for talent to be ahead of the curve, and leaders who come up with new ideas. Economic factors that may impact on the hotel industry. In this article I will explain what the most common social impacts of tourism are and how these are best managed. There are also negative social impacts of tourism. hotel industry to welcome more foreign guests and expand their economy. You may also like reading PESTEL analysis of the aviation (airline) industry. Eating out in restaurants regularly are strong in some countries and cultures. For instance, the UK government in 2019 announced a new deal dubbed as Tourism Sector Dear which confirms its commitment to building over 130,000 new hotel rooms by 2025 with 75% being built outside of London (Stoyle, 2019). reasons, such as when visiting family, friends, on business, or vacationing. sectors for global investors, especially within the United States. We hope the article PESTEL analysis of the hotel industry has been helpful. This tendency will further grow in the future leading to even more demand for hotels. They must also protect the identifying information of their guests. 3. Social factors that may have influences on the hospitality industry Social environment is the next environment to discuss in the PESTLE analysis of the hospitality industry. Millions of jobs were lost, and well known brands ran into losses. He identified four cultural dimensions, then later studies added two more: Power distance. A large part of this industry is composed of luxury hotels. The country has a high standard of living, education, the healthcare system as compared to the other Latin American . the previous Presidents laws. The tourism industry requires many facilities/ infrastructure to meet the needs of the tourist. Likewise, many people work in the industry for a short period and then move to another, creating high labour turnover for many hospitality organisations. Hotel chains are improving profits and revenue by acquiring worldwide resorts, like how Marriott International acquired Starwood Hotels & Resorts Worldwide. These steps can help you get back, Copyright 2020 Weberience LLC. This detailed PESTEL analysis of the hospitality industry aims to examine some of the macro factors that have impacts on the global hospitality industry. A simple explanation. Because of social media, the news is available and updated 24/7. For instance, restaurants must comply with food hygiene standards though these standards may vary from one country to another. Almost all of them are fitted with CCTV cameras to provide security and other features that make the guests stay more comfortable. Luxury and high-grade hotels could put that saved towards building more accommodations for guests. Many hotels are also providing discounts and other offers to ensure that people are able to afford longer and more luxurious stays. Hotels that are still This is This will further drive up wages and . 2. decision and a country loses the vast majority of its economy. However, issues such as political strife and environmental crisis pose a serious threat to its growth. This includes partnership issues between partners, including close family members and the resulting litigation due to lack of proper . The government has a stronghold over the hotel He is a lecturer in Management and Marketing. This isnt something hotel owners can control, but luxury hotels, boutique hotels, and budget hotels. Tourists travel to Brazil to go to the Rio Carnival, to mention a few. The rising weather crisis has incremented such factors in certain places. This leaves hotels, such as Best western with less customers. BUT, there are also some positives. Hotel owners follow innkeeper laws, which ensure the welfare and safety of guests and their properties. biodegradable items to counter the climate crisis. The legal environment of a country is extremely crucial to the growth of the hotel industry. Check risks, rewards for both, Xiaomi 13 series, Watch S1 Pro, Buds 4 Pro global launch today: How to watch live stream and what to expect. laws among others. Or show romantic affection in public in the Middle East? Not only do these hotels need to have the technology that can counter such environmental effects, but they also face a lack of demand due to the inability of travelers to withstand such conditions. The hotel For instance, regulation of business, real estate development initiatives, taxation policies, and preservation of cultural and historic monuments are some of them (BHR, 2021). This could include putting restrictions in place or limiting tourist numbers, if necessary. As these modes of transport are used more often, their impact on the planet increases. A little education in this respect could go a long way, but unfortunately, many travellers are completely unaware of the negative social impacts that their actions may have. While there are several social factors which influence sustainability of any business in general, the ones which are most relevant to the hospitality industry are: Education, Life. 8. world, different languages and fare of hotel etc are the well known factors which affect the tourism industry positively and negatively in the world. Hotel industry has to take proper measures for such factors and taking control over it on time. If consumer sentiment is favorable both airlines and the hotel brands stand to gain. He is a lecturer in Management and Marketing. Local people often gained new roads, new sewage systems, new playgrounds, bus services etc as a result of tourism. Structural Equation Modeling using Partial Least Square Method was used as the research methodology. Everyone wants to stay somewhere safe. Wifi services, lifts, intercoms, etc. Corporate social responsibility (CSR) in the hotel industry is a common practice where companies take good actions to improve society. The State of Hospitality 2022. includes some valuable analysis of contextual economic and financial data around spend, growth, resilience, investment and emerging jobs. The economic factor affects the hotel industry because if the amount of money people have available to spend declines then they wouldn't be spending money on tourism. Such operations in Canada, Europe and America are very costly, but they're affordable in the local Thai market. For Centara Hotels & Resorts, Thailand's leading hotel operator, this balance is at the core of its strategic vision. Travel and Tourism can also affect the rights of human beings in an area. The hotel industry is often the major employer in many developing countries and many hotels are pledging to recruit more young people in the future which is good news for young people, and people with some kind of social disadvantages. Likewise, these organisations waste a wide variety of things such as food, paper, furniture, appliances, and many more. Get all the insights . However, some social factors impact on the hospitality industry badly. Explains how social factors affect and influence buyer behaviour, such as buying products to fit in with a certain social group. The strength and the weakness of currency also impact on the hotel industry. pay immediate attention to. massive amount of disposable items it can be the cause of serious environmental When vacationing, customers want to stay somewhere warm and relaxing. But at the same time, they also lead to a higher demand for budget hotels thereby increasing certain verticals of this industry. There are other social factors too that affect the global hospitality industry. In this article PESTLE Analysis of the Hotel Industry. Various international hotel chains are shifting towards more If the spending patterns of customers are favorable, for example the demand for hotel reservations are increasing then this would be a positive effect since revenue would be coming into the industry. Skilled labour shortage, staff turnover and Irregular working hours. We hope the article PESTEL analysis of the hospitality industry has been helpful. First, the two hotel industries impacted the state economy due to a high induced effect from output and a considerable direct, indirect and induced effect from labor income and employment, despite their relatively lower multipliers and the economic downturn in the state. The establishment Perhaps they have been introduced to alcohol through the tourism industry or they have become resentful of rich tourists and turned to crime. Crime rates typically increase with the growth and urbanisation of an area and the growth of mass tourism is often accompanied by increased crime. Many people believe globalisation to be a bad thing. The USA has different data protection laws on both the federal and state levels. Where tourism has grown exponentially many different positive and negative impacts have been noted, and the greater the dependence on tourism the community has, the more inclined locals and the local tourist industry are to change local traditions and lifestyles to adapt to tourists' needs. At Marriott International, I supported the expansion of the company in the Europe, Middle East and Africa region. For the specifics, keep reading this PESTLE analysis of the hotel industry to learn more. Social factors that may impact on the hotel industry. 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