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Impact of COVID-19 on the hotel industry

Lockdowns, travel restrictions, social distancing policies, and closures of offices and schools are just some of the measures countries across the world are implementing in response to the rapid increase in COVID-19 cases in order to reduce the transmission of the virus, decrease deaths, and prevent catastrophic consequences for national health systems, which have had a significant effect on employees and businesses. As of the beginning of April 2020, around 81% of the world's workforce was affected by forced or suggested workplace closures. A drop in economic activity takes time to convert into a decline in employment, but the current crisis had an immediate and broad effect on employment as a result of lockdowns and other measures (Committee for the Coordination of Statistical Activities 2020).

The COVID-19 had a drastic impact on several businesses across the globe, and the hotel industry was among the hardest hit (Krishnan et al., 2020). When looking at the Baltic hotel market, it reflects that RevPAR slid by 64%, 68%, and 72% in Vilnius, Riga, and Tallinn, with occupancy being the primary cause of the decline in RevPAR. Europe saw a similar drop in occupancy, by an average of 70% between 2019 and 2020. It is anticipated that demand levels will reach the 2019 level only until 2023 (Christie & Co, 2020). Many of the countries most severely impacted by the health crisis are important players in the global tourism economy, either as destinations, source markets, or both. The countries with the most reported instances contribute to around 55 and 68% of worldwide inbound and outbound tourist spending, respectively. The impact of the crisis on these countries will spread to other locations, and the impact will be most severe on territories that rely largely on international tourism (Committee for the Coordination of Statistical Activities 2020). The industry's ability to adapt and innovate during COVID-19 would determine its future operational success. Various hotel brands have shifted their focus to further developing internal cleaning protocols and innovating products in order to attract more guests (Breier et al., 2021). As recent studies suggest that consumers have heightened expectations related to cleanliness and disinfection, as many as 93% of travellers expect hotels to have implemented the necessary safety measures and this is often one of the main factors considered when choosing a property (2021 Housekeeping And Hygiene Study Reveals Guests' Expectations Have Shifted In A Big Way 2021). Over 54% of the travellers felt satisfied with the health and safety protocols implemented in their chosen hotel, and 70% felt satisfied with how the hotel industry has adapted operations in order to provide a more safe environment for their guests (The New Landscape of Housekeeping and Hygiene: Communications and Protocols are Key to Gain Travelers’ Confidence).

Hilton Hotels & Resorts is arguably one of the most recognisable hotel chains, with over 100 years of continued success. Conrad Hilton purchased his first hotel in 1919 in Mobley, Texas, and opened the first 'Hilton' branded hotel in 1925 in Dallas. What followed was an extraordinary journey leading to managing and operating over 6500 hotels in 119 countries by 2021. In addition, Hilton shaped the hospitality industry by pioneering innovations such as air conditioning in rooms, minibars, and room service (As Hilton Hotels Turns 100, 2019) and striking again during COVID-19 by introducing CleanStay by Hilton (Meon Valley Travel, 2020). The CleanStay program brings a new level of hotel cleanliness, disinfection, and innovation that builds upon existing high standards of housekeeping and uses hospital-grade cleaning products that are implemented across Hilton’s 18 brands:

  • Online: Guests will see a new landing page at that will outline what they may experience throughout their stay, even before they travel. Furthermore, property websites will be updated to reflect the implementation of the new cleaning techniques and processes.
  • The Lobby: Guests have the opportunity to skip the regular check-in process at the reception desk and take advantage of the ability to check-in, select a preferred room, unlock the door with a Digital Key and check-out by using the Hilton Honors mobile application.
  • The Guest Room: In order to indicate that the room has been fully cleaned and disinfected, a door seal will be applied by one of the housekeeping team members. An additional focus will be directed towards cleaning frequently used areas around the room, such as light switches, door handles, TV remotes, thermostats, and so on. Also, any in-room collateral with information uploaded into the TV’s and pens and papers removed with option to request at reception desk.
  • Housekeeping Service: On the top, cleaning and disinfaction, an additional gap of up to 48 hours is left between arrivals and departures, which allows housekeeping to air the room for a longer period of time. Service is based on guest preferences, recognising that not everyone is after a daily clean and would rather allow access to the room only after check out. Additional amenities remain available upon request and are placed outside the guest’s door.
  • The Public Spaces: An additional focus is on public space with more frequent cleaning of areas such as the lobby, gym, pool, changing rooms, restaurant, bar, lifts, public restrooms, etc. Additionally, the gym might be unavailable more often due to multiple cleanings throughout the day. Equipment might be relocated to ensure social distancing. Depending on local restrictions, there might be a maximum number of allowed guests per session. Sanitazing stations and wipes are located in primary locations around the hotel.
  • Food and Beverage: In the hotel restaurant, the tables and chairs are placed and paired depending on available capacity and to ensure physical distancing is as per regulations 2-3m. Biodegradable cutlery and takeaway boxes are available upon request. During the breakfast service, the restaurant offers a range of breakfast options depending on the operations and hotel occupancy- full buffet, grab & go, plated, and room service. Also, a contactless room service option is available, in which case the order is left outside the guest room.
  • Meetings & Events:The EventReady in conjuring with CleanStay program sets a new standard of conferences and events at Hilton which delivers clean and desinfected, safe, creative food and beverage in combination with latest technology meeting options and the main focus remains health and safety. Hilton's world-class hospitality and the responsiveness of its devoted Team Members support the whole event experience, from planning to execution (Hilton Press Center, 2020).

Adaptation strategies of the hotel industry during COVID-19

Hilton hotels are perfectly positioned to provide a new service to consumers who like to work from home. Businesses and individuals looking for a secure and convenient remote office space may now take advantage of Hilton's hospitality and service by reserving a hotel room for the day, which is supported by Hilton CleanStay (WorkSpaces by Hilton, 2020)


  • To analyse response of hotel sector to the pandemic
  • To understand perceptions of guests about adaptation and the innovation within hotel industry during the COVID-19


  • To review impact of COVID-19 on hospitality industry
  • To understand measures adopted by hospitality sector for dealing with COVID-19

Research Questions

  • How has COVID-19 affected hospitality industry?
  • What are the measures which have been used by hospitality industry for dealing with the effects of COVID-19?
  • What are the perceptions of guests regarding adaptation and innovation in hotel industry?
  • How can the hotels innovate and adapt the operations in regard to the future pandemic shocks?

This will be done by analysing a sample size of 5417 SALT (Satisfaction and Loyalty Tracker) surveys collected internally via the integrated Medallia platform from the Hilton Garden Inn Riga Old Town database. The research questions that I will  seek to provide a response to will be: what steps were taken in the hotel sector in order to innovate and adapt operations during COVID-19.The main focus metric that will be analysed is the cleanliness score prior to and during the pandemic.

Worldwide growth was expected to slow and gradually pick up in 2021. Research by the OECD (2020) indicates a significant decline in global financial markets and increased uncertainty, which would depress global GDP early in the year and eventually bring it below zero in the first quarter. Furthermore, global GDP growth was expected to fall from 2.9% to 2.4% in 2020 before rising to over 3 1/4 % in 2021 as the coronavirus's impact fades and the industry progressively recovers. This information was calculated using the NiGEM macroeconomic model that is applied by several industries around the world for economic forecasting, scenario development, and simulations (OECD Interim Economic Assessment Coronavirus: The world economy at risk, 2020). Given the serious threats imposed by COVID-19 which was further elevated by the absence of vaccines and people's unsureness and unwillingness to be vaccinated, would even further impact assumption-based simulation. When compared with the research done by Nelson et al (2021) GDP would be expected to fall by 3.6% in 2020, with a recovery in 2021 at 6.7%. Also, the OECD (The Organization for Economic Cooperation and Development) published an updated forecast in September 2021, which predicted that the global economic system had decreased by 3.4% in 2020. However, they also predicted annual growth of 5.7% in 2021 and a slight decline of 1.2% in 2022. Progress in the development and administration of vaccinations during the first quarter of 2021 increased the opportunity related to social distancing regulations, which would allow to ease restrictions and would directly reflect an improvement in economic activity. Most analyses indicate that most countries' GDP growth rates in 2021 may outperform pre-pandemic forecasts, while economic growth in 2022 may revert to more historic levels. If however, a viral outbreak takes place, the government is more likely to reintroduce necessary measures in order to address high infection rates (Nelson, M. et al 2021).

When reviewing the analysis provided by Coronavirus travel recovery options (2021) it is clear that the pandemic has a disastrous effect on the hospitality sector wiping out a decade’s worth of revenue and job growth. The worldwide travel and tourist business was predicted to be valued at over 700 billion dollars in 2020, but that projection has now been reduced to 447 billion dollars as a consequence of the coronavirus pandemic (Hotel industry: navigating the impact of COVID-19, 2020). American Hotel and Lodging Association and Kalibri Labs, reported that the hotel sector will be closing 2021 down with more than 59 billion dollars in business travel revenue when compared to 2019, after losing over 49 billion dollars in business travel revenue in 2020 (Breier et al. 2021). The segments that are included in business travel are government, group, corporate, and other business travel categories. Taking into consideration that businesses and groups have the biggest revenue-generating potential, it isn’t expected to reach the same, pre-pandemic, demand until 2024. Current thinking, however, as indicated in (Hilton 2022 Trend Report) highlights that respondents participating in the survey took the advantage of the pandemic to tighten expenses and save up for a dream holiday which would lead to higher spending. Taking this into account the potential to see earlier recovery signs, especially within the domestic travel as 42% booked vocations, based on travel advisors from host agency Travel Experts, will be traveling locally (Poder M., 2021). Another significant economic impact is related to employment as reported by World Travel & Tourism Council (2021) prior to the pandemic, both travel and tourism were accounted for 1 in 4 of all the new positions created around the world which is over 334 million positions 10.6% and 9.2 trillion dollars 10.4% of global GDP. Furthermore, international tourists spending is accumulated to 1.7 trillion dollars in 2019 with 6.8% in total exports and 27.4% of global services exports. Taking into account the slow recovery process, hospitality industry workers had no other option but to change careers or transition into a new industry without experience (Employee Benefit News, 2021) and eventually gain alternative qualifications (Indeed Career Guide, 2021) as reports indicate that one-third of hospitality employees are dissatisfied with their current employment and as a result, 58% are planning to seek alternative positions before 2021 (, 2021). Also, more than a quarter of former hospitality employees responded that they would not have left their jobs if the pandemic hadn't occurred and the former 20% are no longer planning to seek future employment with the hospitality industry (Employee Benefit News, 2021). Continuous industries instability has led to talent shortage with businesses now are obligated to offer higher hourly rates in order to attract potential candidates applying for the position. As indicated by the Bureau of Labor Statistics Molla (2021):

Hilton's response to COVID-19

(Molla, 2021)

Job openings severely exceed resignations, which essentially delays the re-opening of accommodation, food and drink providers, event planning, and other travel and tourism-related businesses from being fully operational (Newlands E., 2021). As per the article by McAllister J., (2021) nearly 30% of all hospitality businesses are currently struggling to fill the necessary positions, when compared to other industries it’s 13%.

The management team are carrying out consultation with the local health authorities for establishing action plan which are tailored to the particular situation. They have been implemented in adherence to the local government recommendations for the prevention of COVID-19 transmission. The actions which have to be included is that the occupancy rate has to be reduced in the event of physical distancing not being able to achieve. The staff have to be provided access to the facilities and the supplies have to be provided in regard to regular hand hygiene and the regular cleaning (Breier et al. 2021). The plans are being made for the incorporation of policies for the teleworking that can help the hospitality industry to deal with the ravages of COVID-19. The plan has to be updated owing to new guidance and procedures or the regulations which have been issued by the pertinent authorities. The hotels can make use of flexibility that can help the hotels for thriving within evolving market situation and they have to adjust their pricing strategies for the maximisation of long-erm revenue. The hospitality industry can make use of hotel property management software that can help to provide valuable inputs and it can present cumulative of finances and the occupancy. The audits can be carried out during the night that can help the hotels for making effective business decisions. There has to be a crisis team placed in the hotels and it should involve members of various departments which can support management for implementing action plan (Shin and Kang 2020). There has been regular monitoring of staff absenteeism which can detect and properly respond to the COVID-19 illness. The information policy are being kept for the guests and it is pre-defined with the help of communication in between the management and the staff. The guidelines have to be provided to staff regarding how to communicate action plan to the guests and various other stakeholders for ensuring alignment and the consistency. The staff have to stay up-dated and they have to obtain and provide the information about various events. The hospitality industry is making use of short documents and informative posters for the amplification of key messages among staff and the guests (Norris, Taylor Jr and Taylor 2021). They are involving themselves in promoting hand hygiene in the event of physical distancing not being feasible and community transmission. The staff training can be held during COVID-19 that can aid to inform staff regarding the pandemic. The multiple training sessions are being held for the staff for talking regarding present situation of pandemic and for finding scientific ways for containing spread in the workplace. (Hao, Xiao and Chon 2020).  The management in the hotels are informing the staff about measures which can protect health of other people. The management have organised the regular information briefings which covers basic protective measures about COVID-19.

Hilton's CleanStay program

Recently published article by Krishnan et al. (2020) who surveyed 3,498 travelers from five nations in April 2020 found that the majority of American leisure travelers desire increased health and safety protocols to encourage them to travel again which also led the hotel sector to promote cleaning protocols and build upon existing standards of housekeeping in order to capture additional guests and provide a safe environment for the residents (Zambello, L. 2020). When looking at the COVID-19 impact on the hotel sector and taking Latvia as an example at the end of 2019 the country offered 847 hotels, however, 147 properties were closed by the end of 2020, the offered bed number dropped from 13 000 in 2019 to 9 000 in 2020 due to travel restrictions and lack of tourists (, 2021). When reviewing a bigger market, such as Europe, an article published by Kett R., (2020) indicates that several hotels will find it challenging to operate as the expense of providing guests with the reassurance they require is associated with higher costs and hoteliers may be pressured to operate with decreased occupancy (Bird & Bird, 2021). However, not all costs are likely to increase and there are alternative revenue streams and innovative possibilities that hotel businesses can benefit from. Hotels must focus on increasing consumer perceptions of safety and lowering concern levels by using risk-reduction methods in order to attract more guests. Implementing technological advancements that limit visitor contacts with hotel personnel and improve hotel cleanliness may be an effective technique for lowering health risks for hotel guests (Phelps, 2020). Various hotel brands, such as Marriott, Hilton and Hyatt are already implementing various technologies in order to apply social distancing adapting mobile check-in applications, self-service check-in machines, and robot cleaning systems (Garcia, 2020). It doesn’t stop there, taking into consideration that companies are more often debating whether or not they should let the lease expire and adopt the new way of working which is virtual (Davidson, P. n.d.). Various hotels are now transforming bedrooms into remote working offices with high-speed Wi-Fi, hospitality tray, and even the opportunity to use the gym (FOXBusiness 2020). Voice assistance solution with integrated Amazon’s Alexa which allows guests to engage without using the guest room phone (Net, 2020). Flexible cancellation policy in order to encourage more guest reservations which gives the necessary confidence to travel (CoStar, 2021). Extended stay offers customers long term accommodation with amenities, similar to apartments, such as self-service laundry, in-suite kitchen which are both cost-effective and a great alternative when compared to traditional renting (, 2020). Although many restaurants will be unable to perform at full capacity even after the pandemic has passed, an increasing number of hotels are providing "At Home" experiences, bringing the restaurant experience to your home (, 2020).

According to PublicisSapient (2020), the main experience driver for travelers was interaction with team members; however, consumer behavior has shifted, and according to the research, 78% of respondents mentioned that the ability to use contactless technology was one of the top three considerations when selecting a hotel, suggesting that face-to-face interaction has shifted into digital. Nevertheless, there are a number of variable factors stimulated by the consumer's immediate surroundings (Mansoor and Jalal, 2010). Potential risk factors are the key indicators when choosing the desired destination (Perpina et al., 2020), with safety being predominant and is now four times more important than good customer service (Mercurio, N., 2020). Tourists' behavior is affected by both psychological and economic factors (Net, 2021). In order to avoid unecesary contact with others, consumers expect minimal housekeeping during their stay with opertunity to avoid crouded breakfast rooms by taking advatage of grab-and-go breakfast option (CoStar, 2021).

SALT surveys analysis

The guests expect certain innovations from the hospitality industry that can help in ensuring that they stay safe in the hotel. They want that the reception staff have to take precautions and adhere to basic protective measures which includes physical distancing. They want that fabric masks have to be used by general public in the event of widespread community transmission. (Li et al. 2021) The COVID-19 tests have to be made mandatory in the hotels and they have to be recommended for the tourists. They have to impose obligation for the guests regarding their quarantine after their arrival that can help to ensure safety and well-being of the guests (Peco-Torres, Polo-Peña and Frías-Jamilena 2021). There has to be installation of the technology tools that can aid in early detection of the outbreaks and it can enhance safety of the public. The thermal cameras and the Internet-of-Things (IoT) sensors have to be used in the hotels for protecting the guests. The IoT devices can help in supporting open protocols and device provider have to ensure integrity of data during communication and the transmission. The guests expect that there has to be physical distancing measures which alongside with frequent hand hygiene can be instrumental in preventing transmission of the COVID-19. The reduction of occupancy rate have to be considered in the event of facilities not allowing the proper physical distancing (Le and Phi 2021). They want that the reception desk needs to have personal protective equipment (PPE) kits for the purpose of using during suspected case of the COVID-19. It has to include various items like disinfectants, medical mask, gloves, plastic apron and isolation gown. The staff have to be trained regarding using of kit and they have to know how to use full PPE kit and the procedures that have to be used for putting on the kit. There has to be regular inspection and maintenance of HVAC systems and there has to be rigorous standards for the installation and the maintenance of ventilation systems that can help to ensure well-being of guests in the hotels (Herédia-Colaço and Rodrigues 2021). The attention has to be provided in the normal circumstances regarding monitoring condition of the filters that can help in taking care of airflow in the rooms. The hotel industry can disable the demand-control ventilation (DCV) controls which can reduce air supply on the basis of temperature or the occupancy. There has to be inspection of filter housing for ensuring that there is appropriate filter fit and it has to be checked for ways for minimising the filter bypass.


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