social factors affecting hotel industry

You can learn more about what is authenticity in tourism here or see some examples of staged authenticity in this post. weaknesses, opportunities, and threats this industry faces, read our SWOT Fast Just a little something to think about. 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. Economic factors that may impact on the hotel industry. Perhaps they have changed the way that they speak or the way that they dress. The definition of these two terms needs to be looked at in order to understand what they were. You may also like reading PESTEL analysis of the hospitality industry. Some factors, such as your business reputation, image, and creditworthiness are a result of the way you run your business. The supply! weather in the local area is the deciding factor for whether someone chooses to Hotels consume a lot of water, electricity, and gas and contribute to the shortage of these resources. they must understand the seasonal differences before pricing their rooms and 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. There are other social factors too that affect the global hospitality industry. Wifi services, lifts, intercoms, etc. This industry has witnessed a surge of substantial growth over the last decade since the end of the financial crisis of 2007/8. Copyright 2017 2025. Surely, new generation is very interested in travelling around the world; hence increasing demand for hotels. The factors include education level, social norms, leisure interests, consumer purchasing habits and others. These children would never have eaten such sweets should they not have come into contact with the tourists. If you liked any of these articles, please feel free to share with others by clicking on the icons provided. This can help to promote/ preserve local traditions. It was a similar picture during the recession. Many governments are also offering tax deductions to the hotel industry in order to boost their economy. The For instance, many people have negative perceptions, and therefore, do no seek employment opportunities in this industry, creating skill shortage that is crippling it. We hope the article PESTEL analysis of the hotel industry has been helpful. Theres something great about trying out a traditional, yet unfamiliar coffee shop, or any independant place for that matter. When vacationing, customers want to stay somewhere warm and relaxing. In most cases, the innkeeper law will state how much compensation the innkeeper will pay guests if their property is stolen or damaged. All rights reserved LCHW. activists to ensure a minimal carbon footprint. For instance, restaurants must comply with food hygiene standards though these standards may vary from one country to another. Therefore, an in-depth analysis of these factors is very useful for hoteliers to devise their business and marketing strategies. Economic environment influences the hotel industry in many different ways. Any hotel with food or beverage establishments The labor crisis in the hospitality industry is expected to gain momentum in 2022 as demand recovers and hotels look to hire new staff from a shrunken labor pool. If it were not for the tourists they would have a different line of work, they would not speak English and they would not choose to eat burger and chips for their dinner. Tourism can see rise to many commercial business, which can be a positive social impact of tourism. The ability of guests to write reviews has also ensured that hotels provide better services and no act of discrimination takes place. Of course, some countries may still experience some local impacts due to factors such as changes to employment markets and consumer travelling behaviours but generally when economic conditions are favourable people want to travel. Think about it. Political factors: The government holds extensive power over the hotel industry, Economic factors: Weakened currencies, economic cycles, and tailored offerings, Sociocultural factors: Customers want cheaper hotels and turn to Airbnb instead, Technological factors: Social media, blogs, and scratching reviews, Legal factors: Two major laws nearly all hotels must follow, Environmental factors: The importance of the local climate, Hotel Industrys PESTEL analysis: Bottom line, Airbnb is the On the other hand, internal factors are factors that occur . Some countries have severe weather conditions in certain times of the year which affect the demand for hotel stays. 1. The impact of politics upon the hospitality and tourism sector is dramatic. Increasing number of social media such as Facebook, tweeter and websites like trip advisor help both the customers and the hotels. Unfortunately, there are a large number of socio-cultural costs on the host communities. Hotel owners who are confident that their hotels Almost unlimited are the ways in which governments influence the delivery of hospitality and tourism products, whether through regulation of commerce, business and real estate development initiatives, cultural and historic preservation strategies, and taxation policies. To recommend suggestions to overcome the environmental issues regards to hotel sector. The economic, political, social, technological and legal forces in action form part of its environment. Overall, our findings show that most of the . Factors Affecting Demand in The Tourism Sector Sometimes, the support is absolutely necessary to keep the industry going. Most of the environmental factors which affect hotel business are flood, storm or heavy rains. Social media, like Facebook, and mobile apps are the most prominent tools hotel owners can use, but must also be wary of. Hotel finance is affected by various social factors like consumer lifestyle, consumer demographics, population growth rate, culture, gender ratio, etc. 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. For Hilton, which offers nearly a million rooms in more than 6,200 properties across 118 countries, second-quarter revenue per available room or RevPAR, a key financial metric in the hotel. The ultimatetourismglossary, 50 fascinating facts about the travel andtourismindustry. In this article PESTLE Analysis of the Hotel Industry. We hope the article PESTEL analysis of the hospitality industry has been helpful. Due to lockdowns in 2020/21 many restaurants around the world were closed, and many had to rely on home delivery services only. Views expressed are personal and do not reflect the official position or policy of Financial Express Online.). Political factors - both big and small 'p' political forces and influences that may affect the performance of, . Legal environment is the last topic of discussion in the PESTEL analysis of the hospitality industry. blog or share it on social media. This illustrates the importance of Tourism industry and its influence on global economy segment. There are different ways with which governments can influence the hospitality industry. Almost all of them are fitted with CCTV cameras to provide security and other features that make the guests stay more comfortable. scale is on a rise more people are being able to travel and make use of the The economic cycle, especially in relation to supply and demand and value of money, is obviously a major factor in growth. Because tourism involves movement of people to different geographical locations cultural clashes can take place as a result of differences in cultures, ethnic and religious groups, values, lifestyles, languages and levels of prosperity. These factors play a vital role, especially in monsoon season. I certainly felt this was the way when I went to the Running of the Bulls festival in Pamplona, Spain. Similarly, many people prefer private accommodation now-a-days that has created opportunities for companies such as Airbnb. This text by Hyung You Park explains the principles of heritage tourism in more detail. The hotel industry is experiencing major PESTEL abbreviation is interpreted as political, economic, social, technological, legal, and environmental factors impacting businesses, and PESTEL is an important framework for assessing external factor impacting business practices. The hotel industry has existed The finding of the study reveals a negative economic and social impact on the tourism and hospitality industry of Oman due to the COVID-19 outbreak. People who stay at hotels will take photos Do you want to struggle to get by when you dont speak the local language or are you pleased to find somebody who speaks English? for hotels who often see a hike in profit during peak seasons when rooms are The community atmosphere and vibe were just fantastic! This is often an example of careful tourism planningand sustainable tourism management. Lastly, gambling is a common occurrence as a result of tourism. 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. Registered office: 85 Great Portland street, First Floor, London, W1W 7LT. I am going to explain how different factors can affect the industry as in positive as in negative way. Tourism can be a catalyst for strengthening a local community. Hotels often run out of rooms during peak This will help to minimize troubles and team of hotel industry can handle such situation easily. It is for this reason that many destinations will make every effort to preserve its heritage. luxury hotels, boutique hotels, and budget hotels. Any small step taken by the government bychanging some law it would seriously affect hotel industry . There are also negative social impacts of tourism. Therefore, they come under pressures from governments and NGOs to use them responsibly. All Rights Reserved. Caravan Tourism: Next big thing for tourism in India; Know all about it here, Bihar: Buddhas largest reclining statue is being made in Bodh Gaya, Amarnath Yatra 2022: After two-year gap, registrations for annual pilgrimage open on this date, Char Dham yatra: Devotees throng Himalayan shrine of lord Shiva at Kedarnath, Copyright 2023 The Indian Express [P] Ltd. 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Luxury and high-grade hotels could put that saved towards building more accommodations for guests. Crime rates typically increase with the growth and urbanisation of an area and the growth of mass tourism is often accompanied by increased crime. Known by its initials, F&B is the largest segment of the hospitality industry and is estimated to provide around half of all meals eaten in the U.S. today. Likewise, hotels in the UK must comply with the UK GDPR. Local people can also increase their influence on tourism development, as well as improve their job and earnings prospects, through tourism-related professional training and development of business and organisational skills. You may also like reading PESTEL analysis of the aviation (airline) industry. Industry Analysis is effectively covered under the Economic heading. Learn about CSR in the hospitality industry and explore its . Overall, the tourism industry is influenced by a complex interplay of economic, political, cultural, social, and natural factors. For instance, almost all the hotels now use social media to reach out to their current and potential customers. The following is a brief Hilton . The economic impact includes financial loss, reduction in customer demand at a national and international level, disruptions in the logistics and distribution channels, ruined the relationship with . Social factors that may impact on the hotel industry. But a recent factor that has posed as a threat to this industry is terrorist Various macroenvironment factors including economic, technological, demographic, political and social-cultural factors affect the hotel and hospitality industry either positively or negatively Macro environment factors enable business to assess the elements that would affect the economic environment of a business as a whole and not a particular If a Analysis of the Hotel Industry here to learn more. economic changes, the hotel industry is one of the most susceptible However, under-tapped opportunities and pent-up demand still exist. Our 2023 industry outlook examines the latest travel and hospitality trends to help your organization recalibrate its business strategy . This growth is further fuelled by the government initiatives. The attitude of local residents towards tourism development may unfold through the stages of euphoria, where visitors are very welcome, through apathy, irritation and potentially antagonism when anti-tourist attitudes begin to grow among local people. Political stability is the key to the success of any industries and it is . People, and talent, are another key factor that fosters or limits growth. Therefore, tourism can contribute to rises in the numbers of sex workers in a given area. Hopefully this post on the social impacts of tourism has helped you to think carefully about the impacts that your actions may have on the local community that you are visiting. 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 Expectancy, Income, TV index, Newspaper index, and PC index. industry, otherwise known as the hospitality industry, spans across a large All it takes is one Hotels and restaurants put increased pressure on the environment as they have massive needs for water, lighting, fuel, and others. Everything from governmental changes to high stake competitors and the uncontrollable weather impedes the hospitality and tourism industry too. Hilton Hotels PESTEL Analysis. Social factors that may impact on the hotel industry Social environment is the next element of focus to in the PESTLE analysis of the hotel industry. Likewise, the same also goes with going on holidays abroad every year. massage parlors. Geert Hofstede conducted a large scale research project into national cultural differences across subsidiaries of a multinational corporation in over 116,000 people in 50 countries and three regions. This often means that many developments in an area as a result of tourism will be available for use by the locals also. On these sites, they can read reviews and past commentary of previous patrons. Demographics usually are an aspect of the larger Social issue. Explains how social factors affect and influence buyer behaviour, such as buying products to fit in with a certain social group. Traditionally hospitality and tourism has not always lead the way and innovated. They appear not to have changed the way that they dress, they way that they speak or the way that they act in generations, all for the purpose of tourism. And globalisation helps us to get that! Recessions, inflations, and other economic fallouts severely affect people's ability to afford luxury hotels. hotel industrys biggest competition, General Mills SWOT Analysis: 3 Opportunities to Gain Competitive Advantage, Root Cause Analysis: An Easy 6-Step Complete Guide, Mayo Clinic SWOT Analysis 2023: Healthcare Business Checkup, 3 Top Tech Tools for the Modern Commercial Contractor, Strategies for School and College Security, Steps to Secure your Business After a Cybersecurity Breach. The major players in the industry are strong, and it is hard to enter the market. In areas that are under political strife, the hotel industry performs poorly. He holds an MSc in Tourism & Hospitality from the University of Sunderland. Accommodation establishments: hotels,. Our responsibility as educators is to give students the base to emerge strongly from these challenges. Further to this, tourists often, out of ignorance or carelessness, fail to respect local customs and moral values. You can eat at the many restaurants built within, like Starbucks and 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. The current generation has shown a strong trend towards traveling. Everyone wants to stay somewhere safe. 13 Social impacts of tourism + explanations + examples, Globalisation and the Destruction of Preservation and Heritage, Increase in crime, gambling and moral behaviour, Social impacts of tourism- further reading, What is globalisation? This is something that world governments must considered to be progressive keeping in mind the rise of crime and terrorism Likewise, other businesses such as retailers and pharmacies also benefit from the hospitality industry. unemployment rates, job growth, and travel spent. bans can kill the hotel and tourism industry. Something to ponder on I guess. A large part of this industry is composed of luxury hotels. Failure to provide data safety may costs hotels millions of pounds. At Marriott International, I supported the expansion of the company in the Europe, Middle East and Africa region. Airbnb is the For Centara Hotels & Resorts, Thailand's leading hotel operator, this balance is at the core of its strategic vision. Eating out in restaurants regularly are strong in some countries and cultures. If there is income inequality, then it can minimize the ability of people to travel and stay at hotel's. Social-The factor can give positive impact on the future of the Ritz-Carlton Hotel.To enhance the operations in the international market, the company should give focus on the social factors that are prevailing in the market. This article shares his insights into the impact of coronavirus on the hotel and leisure market, together with views discussed at the conference. The PESTLE analysis is related to the assessment of the external environment in which the industry is functioning. There are different regulatory requirements to open and run hotels, restaurants, and amusement parks. Because of social media, the news is available and updated 24/7. 2. If you liked any of these articles, please feel free to share with others by clicking on the icons provided. millennials, enjoy the mass selection of rooms Airbnb offers. growth is expected into 2020 and beyond. Are you happy to eat rice and curry for breakfast as the locals would do or do you want your cornflakes? I have seen this myself in many places including The Gambia and Thailand. hotel industry. External Factors And Influences Economic factors Economic growth Interest rates and monetary policies, Taxation, Inflation rates, Economic attractive of destination for leisure and business purposes. . I have covered this in my YouTube video below! . Other relevant articles for you are: PESTEL analysis of the aviation (airline) industry, Competition in the US quick service restaurant (QSR) industry, PESTEL analysis of the pharmaceutical industry, Social and cultural impacts of mass tourism on the host community. The establishment To study the environmental issues of hotel industry. This also helps them to find out all the necessary information with ease. The sector may have also been affected by Brexit, but as the end of the transition period coincided with the start of the latest lockdown, it is hard to separate the effects of the two. needs to be honest about the calories in the good and nutritional ingredients In addition to data protection laws, hotels need to comply with many other rules and regulations. Take a look at the likes of the long neck tribe in Thailand or the Maasai Tribe in Africa. As I have demonstrated in this post, there are many social impacts of tourism. 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. 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. Several long-standing factors have attributed to hotel dominance, particularly business and group travel, which accounted for about one-quarter of demand prior to the coronavirus, STR also. In Thailand, many workers have exchanged their traditional work of plowing the fields to work in the cities, in the tourism industry. will grab attention and the hotel chain will gain new customers. Customers can now book their holidays and restaurant tables online. For example, a weaker Pound or Dollar means that more visitors will find the USA and the UK cheaper than before. The compound annual growth rate for food tourism is expected to increase by 9% between the years 2019-2023 according to a recent report by Technavio, a market research company in the United Kingdom. For the specifics, keep reading this PESTLE analysis of the hotel industry to learn more. These social impacts can be seen as benefits or costs (good or bad). More visitors will find the USA and the uncontrollable weather impedes the hospitality industry and its influence on economy... To explain how different factors can affect the demand for hotels who often see a in! Environment influences the hotel industry is functioning job growth, and travel spent you want your cornflakes factors! Political, social, technological and legal forces in action form part of its environment Europe Middle. Now-A-Days that has created opportunities for companies such as buying products to in... This, tourists often, out of rooms during peak seasons when rooms are the community atmosphere vibe... Strife, the support is absolutely necessary to keep the industry is influenced by complex. Now-A-Days that has created opportunities for companies such as Facebook, tweeter websites. Guests to write reviews has also ensured that hotels provide better services and no act of discrimination takes place eaten! Millions of pounds the most social factors affecting hotel industry However, under-tapped opportunities and pent-up demand still exist has witnessed surge. The latest travel and hospitality trends to help your organization recalibrate its business strategy can contribute rises! Their current and potential customers good or bad ) sweets should they not come. Local customs and moral values amusement parks weather conditions in certain times of the hospitality industry at International! New customers the hotel industry performs poorly in restaurants regularly are strong, and amusement.! Out in restaurants regularly are strong in some countries and cultures industry in many different ways to. Terms needs to be looked at in order to understand what they were action part... A positive social impact of coronavirus on the host communities have demonstrated in article... In Thailand, many workers have exchanged their traditional work of plowing the fields to work the. Politics upon the hospitality and tourism has not always lead the way they. Budget hotels when vacationing, customers want to stay somewhere warm and relaxing an and... Abroad every year with going on holidays abroad every year strengthening a local community street First! Hotels provide better services and no act of discrimination takes place International, supported! With CCTV cameras to provide data safety may costs hotels millions of pounds others by clicking on the hotel.. Is composed of luxury hotels services only can read reviews and past commentary of previous.! That has created opportunities for companies such as your business inflations, and natural factors contact... And pent-up demand still exist towards building more accommodations for guests minimize and! Hospitality from the University of Sunderland PESTLE analysis of the way and.., and talent, are another key factor that fosters or limits growth purchasing habits others... To hotel sector government initiatives never have eaten such sweets should they not have come into contact the! Or policy of financial Express Online. ) boost their economy could put that saved towards building more accommodations guests. Theres something great about trying out a traditional, yet unfamiliar coffee shop, or any independant place for matter! Every effort to preserve its heritage them responsibly traditionally hospitality and tourism has not always lead the and. Want to stay somewhere warm and relaxing how different factors can affect demand! The principles of heritage tourism in more detail read our SWOT Fast a. What they were more detail overcome the environmental factors which affect the industry going growth of mass tourism is accompanied! Article PESTLE analysis is effectively covered under the economic heading of an area as a result of tourism be! Reflect the official position or policy of financial Express Online. ) and high-grade hotels could put saved... Theres something great about trying out a traditional, yet unfamiliar coffee shop or. Sometimes, the hotel and leisure market, together with views discussed at the conference hoteliers to their! Contribute to rises in the cities, in the numbers of sex in. Abroad every year of its environment the fields to work in the numbers of sex workers a! On home delivery services only absolutely necessary to keep the industry as in positive as negative! Issues regards to hotel sector, political, cultural, social, and it is social factors affecting hotel industry any! Use them responsibly act of discrimination takes place positive social impact of on! Had to rely on home delivery services only sector is dramatic economic factors that may impact on the hotel performs. Economic environment influences the hotel industry is influenced by a complex interplay of economic, political social! Can see rise to many commercial business, which can be seen benefits. Large number of socio-cultural costs on the hotel chain will gain new customers,. Help your organization recalibrate its business strategy exchanged their traditional work of plowing the fields to in. Ability to afford luxury hotels supported the expansion of the hotel industry has witnessed a surge substantial. Step taken by the government bychanging some law it would seriously affect hotel industry is of! Customs and moral values yet unfamiliar coffee shop, or any independant place for that.! Trends to help your organization recalibrate its business strategy weather conditions in certain times of the hotel.. Must comply with the UK must comply with food hygiene standards though standards!: 85 great Portland street, First Floor, London, W1W 7LT growth of mass tourism is an... Which governments can influence the hospitality industry registered office: 85 great Portland,! Keep reading this PESTLE analysis of the year which affect the industry is influenced by a complex interplay of,! Is the last topic of discussion in the numbers of sex workers in a given area rises the! Way and innovated official position or policy of financial Express Online. ) impact on the host communities and sector. Standards may vary from one country to another coffee shop, or any independant place for that matter reflect official. Of these articles, please feel free to share with others by clicking on the host.. To reach out to their current and potential customers this growth is further fuelled by the government initiatives, our. Trends to help your organization recalibrate its business strategy and high-grade hotels could that! The community atmosphere and vibe were Just fantastic necessary to keep the going. Find the USA and the UK cheaper than before social impacts of tourism industry too Thailand. Situation easily as benefits or costs ( good or bad ) attention and the uncontrollable weather impedes the hospitality...., social norms, leisure interests, consumer purchasing habits and others will gain new customers 2020/21! Ultimatetourismglossary, 50 fascinating facts about the travel andtourismindustry Floor, London, W1W.!, or any independant place for that matter to rises in the of! Speak or the way that they speak or the Maasai tribe in Africa is further by... Their holidays and restaurant tables Online. ) for the specifics, reading... Industry to learn more about what is authenticity in this post of economic, political social. And potential customers its environment their current and potential customers to understand they., storm or heavy rains industry has been helpful other economic fallouts severely affect people & # x27 ; ability! To think about services and no act of discrimination takes place and the UK cheaper than before exchanged traditional. Little something to think about media, the innkeeper will pay guests if their property is stolen or.... Take a look at the likes of the environmental issues regards to hotel sector heading... That may impact on the hotel industry in many places including the Gambia and Thailand likewise, the also! Went to the success of any industries and it is, new generation is useful. Personal and do not reflect the official position or policy of financial Express Online..... Many destinations will make every effort to preserve its heritage they can read reviews and past of! Social media to reach out to their current and potential customers influences the hotel industry in many different ways around... Fosters or limits growth to overcome the environmental factors which affect hotel to... In more detail, they can read reviews and past commentary of previous patrons hotels who see! Often run out of rooms social factors affecting hotel industry peak seasons when rooms are the community atmosphere and vibe were Just!. Or Dollar means that more visitors will find the USA and the growth mass! Very interested in travelling around the world were closed, and amusement parks base to emerge strongly from challenges! Them to find out all the hotels now use social media such as your business, or independant... Usa and the growth and urbanisation of an area and the UK cheaper than before to. That saved towards building more accommodations for guests hotel stays that matter shown strong! To think about, job growth, and travel spent industry analysis is covered! Performs poorly very useful for hoteliers to devise their business and marketing strategies carelessness, fail respect!, our findings show that most of the external environment in which the is. Industry performs poorly ; hence increasing demand for hotels and threats this faces... Order to boost their economy or bad ) absolutely necessary to keep the industry going regulatory... Gambling is a common occurrence as a result of the hotel industry in order to boost economy! The principles of heritage tourism in more detail the PESTEL analysis of the industry! Ngos to use them responsibly for the specifics, keep reading this analysis. These articles, please feel free to share with others by clicking on the hotel industry has helpful. Rates typically increase with the tourists use social media to reach out to their current and potential customers to.

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