Fulhaus on design and the future of business stays
Canada: In her latest blog post, Fulhaus founder Andria Santos talks about the basic design principles to take into account in short-term rental properties and how this goes hand in hand with the growing segment of business travel.
Practically overnight, the business travel market has transformed. Flashy entrants offering a dynamic, curated experience for guests are defining a new standard of quality. And established providers, many of whom still rely on the tried-and-tested modes of operation that worked five years ago are losing market share.
In order to better meet the needs of a new generation of corporate travellers, established providers need to do more. They would be wise to focus on re-interpreting three foundational pillars of design, namely: technology, ease-of-use, and uniqueness. A refreshed strategy around each of these pillars will be instrumental as they look to remain relevant in the years ahead.
Business travel: Growth in a changing landscape
The business travel market is going through a period of impressive, extended growth. According to findings from Allied Market Research, the global business travel market is set to hit 1.6 billion in value by 2023, growing an average of 4.1 per cent CAGR.
The market is not growing in ways it traditionally has, however. The rise of host sharing platforms has revealed what business travellers want in their home away from home. A study from real estate giants Kushman and Wakefield found that business travellers make up 15 per cent of Airbnb bookings in 2019, with this number expected to double by 2020.
A full 30 per cent of Airbnb’s booking traffic coming from business travellers? That is a substantial percentage. Clearly, business travellers are looking for something more than the uniformity traditionally on offer.
The cause for a lot of these changing expectations is coming from a new demographic: the millennials.
Millennials differ in some striking ways from previous generations. Aside from their age, interest in technological accessibility, and expectations for flexible working conditions, millennials also tend to stand apart from their predecessors in another (perhaps) surprising way: they like to travel for work!
A Hilton survey of workers in the United States found that 75 per cent of millennials think travel for work is a major perk, while a further study from Hipmunk found that 55 per cent of millennials would extend a business trip for pleasure. Here we have evidence of a movement some have dubbed “b-leisure”: the inclination among millennials to mix business with leisure. For example, a conference meeting followed by a shopping spree from the comfort of your dwelling.
A report from Skift rounds out this picture of the millennials influence on corporate travel. The top three trends in business travel are: the sharing economy into the “C-suite”, small and medium-sized entrants “finding a seat at the table”, and the demand amongst visitors for an “end-to-end experience”. These trends all originate from the millennial orientation to work and travel.
Beyond convenience: The end-to-end business stay experience
But it is not just millennials that expect more than a cookie-cutter hotel room on their corporate sojourns. As the market trends report from Skift indicates, business travellers of all ages want a more streamlined, “end-to-end” experience in their stays.
New research from the Global Business Travel Association (GBTA) provides insight into the dynamics of corporate booking. A global survey of corporate buyers and travellers found that:
• Although 50 per cent of travellers surveyed say they value personalisation in their stays, only 19 per cent of buyers said this was a need.
Meanwhile, on the question of convenience, easy payment options are crucial, with:
• 88 per cent of travellers stating they would book property with a central payment over other payment offerings.
As the authors of the survey point out, while travellers seek convenience, personalised options, and competitive prices with amenities, corporate buyers tend to underestimate how important these factors are.
Given this discrepancy, it is no wonder that millennials tend to book their own trips on third-party platforms like Airbnb. And what you generally find is that short-term rentals are all about the streamlined experience: they offer central payment services, mobile integrations for signing in and signing out, various personalised amenities, and of course the option to find, book, and manage online from mobile devices. The amount of friction involved in finding these spaces is minimal, and as the market data shows, business travellers tend to like the accessibility and personalisation features more than loyalty perks and a complimentary breakfast.
Implicit in all these market indicators is that established business travel providers – whether global hotel chains or smaller-scale providers – need to do a better job delivering a convenient, comfortable, and connected experience for their guests. The solution here is in design.
Principles of design: Technology, comfort and uniqueness
What is design? Some like to break down design into its various aspects – interior design, graphic design, the list goes on. Segmenting removes the central point about what design truly is, and what makes it so valuable.
Design is an all-encompassing phenomenon, best understood as the combination of several factors working together to create a holistic experience for the user. This includes physical and aesthetic features.
Design involves everything from technology to branding, product packaging to wall colours. Increasingly, people are looking for spaces that are designed to provide an end-to-end experience, a frictionless interaction, a seamless engagement. Most successful business leaders, from Steve Jobs to Henry Ford and beyond, have found success based on the degree to which they could present an item or a service in the form of a well-designed product.
While design trends are fluid, continuously updating in response to social trends, there are some general principles that frame the way spaces, products, and experiences are designed. These principles are:
technology, ease-of-use, and uniqueness. These principles are constantly used as reference points to reinterpret design trends as they change over time. What is striking about these principles in relation to the business travel sector is that they are being deployed expertly by new market entrants. The same cannot be said of established providers.
Design principle 1: Technology
Technology integration is an absolutely crucial feature of a business stay, let alone any type of short-term rental or vacation rental. The way in which technology is integrated into a space is a design question that every provider needs to thoughtfully consider. A tech-enabled space is one that can easily be found and booked online, has ubiquitous hi-speed internet, and has a display screen (TV) that can easily be connected to a computer or tablet. This is the baseline for tech integration, and leading providers can deliver much more.
Providers that have mobile applications that let the guest sign in, lock their doors, order room service, or any range of other requests, are at the vanguard of technological integration. The business stays startup provider Lyric, for example, offers their guests digital access and 24/7 suite support – designed, as they say, to “make your stay as smooth as possible”. Technology, like design, is at its best when it provides the user with a frictionless and functional experience.
Design principle 2: Ease-of-use
Another tenet of design is ease-of-use. Although comfort can come in many forms, established business stay providers tend to keep it simple by offering a bed, table, chair, TV and a bathroom for the average single room.
Jermaine Anderson, general manager of the Hilton Garden, succinctly articulated the experience behind this outmoded approach when she said, “in years past, you could go to a hotel and get the same thing anywhere you went”.
In other words, hotel units and traditional corporate units have been designed to be easy to use in the sense that you know what to expect. And often, what one gets in a hotel room is still not too far off what Anderson says: no kitchen, no relaxation area, just a lot of the same furniture. Allocating resources to create uniform spaces is not, as it turns out, what people want.
But what, then, makes a unit easy to use? The answer is: tech integration and the comforts of home. Given the fact that many people travel for extended periods of time, it is only natural guests seek a comfortable environment that reminds them of their own space and their own things. Most homes have lush curtains, cozy couches, enveloping rugs and blankets, and kitchens with appliances to make a meal.
Here is the thing: the connection a space has to its local environment and culture is one of the comfort advantages Airbnb hosts provide to business travellers. It is time, therefore, for traditional business stay providers to re-calibrate their comfort formula, twisting the dials away from uniformity and simplicity towards personalisation, uniqueness and creative use of space.
Integrating an expanded sense of what comfort entails, based on what they know their guests want, is of critical importance. When they make this change, they will be emulating Zeus, another promising business stay provider that advertises their “smartly furnished neighbourhood homes”, offered for extended stays, and “intentionally designed for you”.
Design principle 3: Memorable experiences
What goes into making a stay memorable? A lot of things, and they all revolve around design. A guest might find it memorable that their room has a side wall painted in a calming shade of blue. Another guest might be pleasantly surprised that they can make dinner on a barbecue in a communal area. The full assortment of little things a provider can do all congregate around a central theme: they are thoughtful gestures that step outside the box and, in doing so, create unique experiences for guests.
This is very much the case with the general experience guests have with Airbnb. Airbnb’s business portal is full of spaces that are unique in their design and comprehensive in the amenities someone might want when travelling for work.
The strategy for established providers should be to become as flexible and varied in the types of stay experiences that they can offer guests. The bar for memorable experiences has been raised.
The march towards better design is happening – are you taking part?
In closing, there are three core principles of design woven into the fabric of the units that business travellers tend to want to stay in. The design principles of technology integration, ease-of-use, and uniqueness are underlying features of the approach new providers are taking in the corporate travel market.
Established business travel providers, for whom delivering comfort and satisfaction is always the foremost measure of success, need to move away from the outmoded service offerings they are so used to providing and internalise these design principles quickly, otherwise they risk losing more market share in an already competitive landscape.