Hospitality and leisure businesses have once again demonstrated their resilience, determination, and adaptability to navigate the accelerated disruption and significant uncertainty of 2022 but how will they face the challenges of the year ahead?
In this episode of The Collective Conversations, Julia Poulter, Co-Founder of The Collective, talks with Philippa Wagner, Creative and Cultural Strategist, and Katie Tobin, Co-Founder of Festival of Hospitality about the key drivers shaping the industry, emerging technologies, sustainability, togetherness, and much more.
Julia Poulter: Welcome Philippa and Katie. I would like to start today’s conversation by asking you what you think are the key drivers shaping the hospitality industry today.
Philippa Wagner: I think the drivers that are affecting the hospitality industry are the same drivers that are affecting everything in our world today. This includes the bigger question around how we support people and the planet to combat climate change and its social impact. We need to empower communities, businesses, and countries to work collectively to make a change.
Katie Tobin: We should also mention staff shortages and retention issues which continue to be a big problem for the industry, but I think we are starting to see some really interesting solutions emerging. For example, we are seeing hotels working more closely with schools and local authorities to find more local staff. From a food and beverage perspective, food prices are soaring, meaning that consumers are being more conscious of spend. This is having a big impact on innovation as businesses are trying to find ways to combat these issues. Restaurants and hospitality spaces are having to provide unparalleled experiences and moments of escapism in order to encourage people to spend.
Julia Poulter: Thank you, that’s extremely interesting. Picking up on Katie’s point on innovation, I think we can see that the current challenges that the industry is facing are accelerating innovation and this brings me on nicely to my next theme which is emerging technologies. How are hospitality brands utilising emerging technologies to connect with customers?
Philippa Wagner: I think there are two sides of this technology and hospitality coin. On one side, we’ve got the metaverse as exciting shiny toy or new marketing tool, and then we’ve got the much more pragmatic side where we’re starting to see brands using digital twinning technology from the metaverse to understand placemaking and the opportunities and experiences that a future product or proposition could have. In more practical terms, we can also look to technology to solve some of the issues that Katie just mentioned, including staff shortages. We’re not talking about rolling the robots out into hospitality, but technology can be useful to supplement staff shortages and to make a more seamless experience for the guest. You can now be engaged with the brand or experience way before you’re on property.
Katie Tobin: I agree. What is great about this kind of technology is the insights that it gives around guest profiles and operational data, which can then help to steer people’s businesses. As Philippa mentioned, there is obviously a lot of talk around the metaverse and NFT hospitality, but personally I’m still not entirely convinced of its relevance in hospitality given that the sector is so driven by experience.
Julia Poulter: Thanks both. I’m really interested by the idea of NFT hospitality and have just been reading about Flyfish, the world’s first members-only dining club where membership is purchased on the blockchain as an NFT. Katie, do you have any thoughts on this?
Katie Tobin: I think at that luxury level, NFT hospitality is allowing brands to engage with consumers differently. The purchasing of NFTs and DAOs is literally allowing consumers to shape the future of brands, as they’re able to become more involved.
Philippa Wagner: This takes us back to the first question of what some of the drivers are shaping hospitality; community and togetherness as I mentioned earlier are key for me and NFT is an enabler of that. It creates an ownership mindset of making something the best it can be and because the NFT blockchain technology sits behind that, you know you really own something rather than thinking that you’re giving your good ideas away for free. As we start to understand what Web 3.0 can offer us, I think that we’ll see customers engaging with hospitality brands in ways that we’ve never seen before.
Julia Poulter: It’s fascinating and something we could talk about for the full episode, but I’d like to move us on now to another key focus for the hospitality industry in 2023 which is sustainability. How can the hospitality industry keep pace with shifting sustainability targets and concerns?
Katie Tobin: This is being driven from two different angles – by consumers demanding more but also by investors and shareholders now. We’re hearing a lot more about green investments and green financing and this is great because it means it’s being driven much earlier on in the lifecycle and so should lead to change. We’re also seeing greener construction methods and more adaptive re-use of buildings. I was at The Standard the other day, and they have windowless rooms and this is something I think we’ll see more and more of as we try to figure out how to use buildings in a different way. From a build perspective, we’re of course thinking a lot more about decarbonisation and this is interesting from two perspectives. We need to think about both embodied carbon in building materials, but also operational carbon. In terms of supply chains, people are considering food waste a lot more. There are some amazing restaurants doing great work in this area – Silo in Hackney Wick being a good example. We’re starting to think about how we integrate agriculture into our cities, and this is going to become more and more important.
Philippa Wagner: I think the key to what Katie said there is that we’re now seeing this top down, bottom up element. There is green capital coming in but more importantly, there is a push from the bottom, which is becoming much more mainstream. We know that consumers will align their spend with brands that align with their values. Looking after people, place and planet is becoming more important to consumers and many consumers and looking for caring hotels which give back to the local community and land around them. If it’s a resort hotel in a beautiful environment, then this means using architecture that blends in with the local environment. If it’s an urban environment, then it’s thinking about dead stock and how we can re-purpose spaces and breath new life into them. The problem that we’ve got with the industry, which many consumers aren’t aware of, is that operational costs mean that brands need to be really considered in the changes they’re making in this area. I think we’re going to see some backlash against those brands that aren’t able to make quick, demonstrative changes. Brands will therefore need to be very careful about how they’re communicating with consumers so that they don’t fall into the greenwashing trap. Consumers expect openness to be part of the dialogue that they’re having with the brands that they choose to spend their money with.
Julia Poulter: Thank you both – I think these are really interesting and valuable points. I would like to spend the remainder of the episode talking about a theme that has come up throughout this discussion which is togetherness. So what do you think this means for the future of the industry and how can brands be building a sense of community?
Katie Tobin: We chose togetherness as the theme for this year’s Festival of Hospitality because we think it’s so important that communities come together to foster change. One of the ways the industry can think about togetherness is by giving back to the local environment and community. Over the next year, we’re going to be going into schools with some of the speakers that were part of this year’s Festival, to show school aged children that there can be incredible careers in hospitality and that it’s not just this stopgap career that some people think it is. It’s about giving people a seat at the table that wouldn’t otherwise have the opportunity – you can only be a part of the conversation if you’re included in it and learning from each other.
Julia Poulter: Fantastic, I look forward to seeing how the industry continues to embrace togetherness for the greater good. We always end by asking our guests the same question which is what do you think will be the biggest game changer for businesses in 2023?
Philippa Wagner: I think community commerce is going to be a game changer. This will mean individuals coming together with big businesses to bring insight, knowledge, experience and understanding to the table… with a smattering of NFT mixed in the middle I’m sure!
Katie Tobin: Mine is probably a bit more practical but for me it’s blended travel or this idea of working from anywhere. We’re starting to see more hybrid spaces and serviced apartments as the number of digital nomads continues to grow.
Julia Poulter: Thank you both so much for your time today – certainly lots of food for thought!
This is an extract from The Collective Conversations: Future of Hospitality. You can listen to the full episode here.
