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Luxury Consumer Perspective In Covid-19

Introduction - Luxury Consumer Perspective In Covid-19

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That the COVID-19 sanitary issue has had such an enormous and unexpected effect on everyone’s life is something we can all agree on. Even if the industry has taken a beating, the social toll is too great to overlook. Customers’ habits and buying patterns have and will continue to change, and businesses must adjust their strategies accordingly (Ruel and Njoku, 2020).

“It is important for hotel developers and investors to keep this in mind when designing new hotel developments, as the following literature takes a deeper look at how hospitality organisations will need to realign their operations to meet with the current market wants and wishes”. If these alterations are long-term or merely transitory, the research of Melissen and Sauer, (2018) is looking into it. Regardless of the result, companies who are open to considering different possibilities and rethinking their planning processes would be better equipped to face the “New Future”.

Critical Literature Review and Analysis

“The pandemic of the coronavirus will be remembered for centuries to come because of its destructive influence on the global economy at many levels. Commerce will continue to go ahead and overcome the problem as long as the government and banking institutions provide support”. As Ruel and Njoku, (2020) have said, there is always a way out of a financial crisis when there is a strong enough resolve to do it. In addition, luxury hotel enterprises, particularly those tied to the service industry, will have to contend with the social side of the post-COVID world (Stylos and Zwiegelaar, 2019). New norms, standards, and values have and will continue to impact our social behaviour, which in turn affects the behaviour of customers, particularly those who purchase travel and tourist services.

As a consequence of the tightening of border controls, lockdowns, and travel restrictions, the hotel industry has had some of its worst performance in recent memory. A degree of uncertainty that most people have never encountered has been created by financial losses and hotel closures (Benabdallah, 2020). These high-end companies, however, need to drive themselves to look forward and prepare for the new climate that is emerging. It would not be simple or quick, but the industry has repeatedly proved its resiliency and ability to bounce back in the face of adversity, so there’s reason to believe it will be. Adapting to the forces that are influencing the hotel industry’s future is a critical issue right now.

Social consequences are evident to everybody in business and have caused individuals to alter their lifestyles. “Personal behaviours, such as job practises, purchasing habits, and even interpersonal interactions, have been impacted. If the hotel sector is to enjoy a rebirth and continue to grow, it will need to keep these new trends in mind”. Plans and business models for ongoing projects will have to be re-examined in light of changing customer wants and expectations.

To understand how the pandemic has affected customer behaviour and attitudes, this research considers how these changes could impact the hotel industry (Kansakar, Munir and Shabani, 2019). Of course, consumer behaviour is continuously changing, but firms must pause and consider if individuals are experiencing a time of permanent or merely temporary change. The luxury hotel industry must likewise avoid the urge to think that everything will return to “normal” swiftly.

“Never look back, unless you are planning to go that way.” Henry David Thoreau

(Kansakar, Munir and Shabani, 2019)

Evolving consumer behaviour & habits

There are a number of things that have had an impact on how we connect with people and how we see our lives, such as lockdowns and the inability to travel.

Seven major areas of consumer behaviour that are thought to have an influence on the hospitality industry as a whole and the travel and tourism industry in general have been outlined in the following, according to research by Jones and Comfort (2020).

  1. Health and Safety

In light of the current covid epidemic, consumers are becoming more conscious of the need of safety, hygiene, and health practises in the workplace. Google searches for health-related subjects have increased significantly in the last year, reaching a high between March 2020 and January 2021 (Alonso et al., 2020). In order to gain the confidence of their consumers, companies must be both open and trustworthy.

  1. Wellness

With lockdowns creating great isolation and loneliness, the United Nations has stressed mental health and well-being, especially in light of these extreme conditions (Sharma, 2020). Businesses are increasingly emphasising employee health and well-being, including things like on-site fitness and sports, organic and locally sourced food, nutrition, self-care, and routine medical exams.

  1. Consumption & Spending

Consumers’ buying power will be reduced as a result of rising unemployment, so they will spend more on necessities and less on fun things. Better-quality items and well-known brands are more likely to be chosen by consumers. In addition, there will be more preparation and less impulsive buying.

  1. Digitalization

The use of teleworking platforms and online webinars and meetings has become an essential part of our daily work routines (Viglia and Dolnicar, 2020). “In-home delivery, contactless payments, videoconference medical consultations, internet purchases, and even the creation of a “COVID Radar App” all point to an increasingly fast-paced age of digitalization”.

  1. Remote Working

Many firms have used telework as part of their new practises because of the sanitary situation. For the most part, working remotely has been beneficial to both the individual and the business. “According to workers, the advantages of teleworking include, but are not limited to: decreased work-life balance optimization; flexible time scheduling; commute time savings” (Kim, Filimonau and Dickinson, 2020). Businesses have also seen increased productivity, lower expenses connected with physical offices, less worker absences, and greater use of technology. There is a good chance that many companies will continue to provide telework as a viable option for their employees.

  1. Tourism &Travel

Consumers’ perspectives on travel and tourism have shifted as a result of the crisis, according to a Booking.com poll. Greener places, travels closer to home leading to an increasing use of private transportation, the ability to work from a distance, and rural tourism are all developing trends in travel (Murray, 2013).

  1. Sustainability

Individuals, businesses, and international organisations like the United Nations have been concerned about sustainability even before the epidemic. Consumption will be more mindful and less wasteful as a result of this shift in consumer behaviour (Kaushal and Srivastava, 2021). In the future, consumer’s attention will be drawn more to environmentally friendly legislation, environmentally friendly goods, and environmentally conscious companies.

Consequences for consumer spending

Consumer purchasing patterns will change as a result of changes in consumer behaviour. As a result, customers will spend more time comparing and making informed selections, as well as determining how their purchases will affect the global environment (Viglia and Dolnicar, 2020). Citizens have been spending more time at home, which has led to a rise in internet usage and, therefore, an increase in online purchasing transactions. Accessibility, unique deals, delivery service, affordable rates and the option to compare prices are just few of the features that entice customers. Everyone agrees that this way of spending and consuming will become more and more prevalent.

“Consumption is projected to be significantly impacted when the different government subsidies, such as the various furlough programmes” (Viglia and Dolnicar, 2020). “111 million new jobs might be created by 2021, according to the WTTC’s January 2021 unemployment projection, or 84 million new jobs could be created, according to the report’s most cautious scenario” (25 percent below 2019, accounting for 82 million fewer jobs).

“Disposable incomes will continue to be low, unemployment will continue to rise, and consumers will be increasingly price-conscious, selecting for economic solutions and reducing expenditure on non-basic items and services”. After COVID, the Ernst & Young Customer Price Index Report examines five distinct consumer profiles (Kansakar, Munir and Shabani, 2019). In comparison to the pre-crisis period, these profiles have been divided into several categories based on the predicted amount of spending. 9 percent of those polled plan to spend more, 13 percent want to cut back, 22 percent plan to spend less, 25 percent plan to spend more if required, and 31 percent plan to spend the same as they did before the epidemic struck.

  • In terms of tourism and travel, expenditure will be affected in a variety of ways depending on how quickly governments implement immunisation programmes (Jones and Comfort, 2020).
  • As a result of TripAdvisor’s Traveller Sentiment Journey Survey, the following findings may be drawn:
  • “Over three-quarters (77 percent) of travellers surveyed say they will be more likely to travel internationally if they receive the vaccine, rising to 86% for domestic travel. More than a quarter (26 percent) of respondents worldwide say that in order to ensure safe travel they will only travel to destinations that r have a vaccine available” (Alonso et al., 2020).

Adaptability of the hotel industry

Hotel Operations

“The hotel business must change in light of this unprecedented occurrence. For hotel owners and operators, now is the time to show that the industry is resilient and capable of adapting to changing market realities and integrating new laws and regulations” (Stylos and Zwiegelaar, 2019). “It is not just about being politically correct; this is the time to demonstrate the industry’s ability to think beyond the box”.

In the near and medium term, hotels will have to adapt to new processes and requirements that are outlined in the following context.


In every company, “planning and preparation is essential, but in the present environment, thorough, efficient, and ongoing preparation will be more important than ever” (Kansakar, Munir and Shabani, 2019). “In the operational departments, there will be new SOPs to build, action plans to be essential for all divisions, business models to restructure, and contingency plans to analyse carefully”.

Hotel Design

Rethinking hotels’ physical concepts is necessary. Rooms and common areas should be redesigned to respect social distance, which means removing unnecessary items like pillows, decorative accents, newspapers/magazines, and other non-essential items like these (Jones and Comfort, 2020). These are all important factors to take into account when determining how the basic ideation of premium service can be featured to define the level of luxury guaranteed by businesses.

Health & Safety

Hotels will have to put a lot more work into health and safety procedures in the future. The European Travel Commission found that “2/3 of Europeans feel significantly safer and relaxed to enjoy their vacation when strong health and safety measures are in place,” according to the Study on Monitoring Sentiment for Intra-European Travel. Some corporations have responded to this by launching unique marketing aimed at safeguarding the stay of their customers (Viglia and Dolnicar, 2020). Medical care is available around the clock, and some hotels and resorts even provide extra coverage or complimentary PCR testing. The following are examples of hotel marketing campaigns:

Sales & Marketing Strategies

According to the “European Travel Commission’s Study on Monitoring Sentiment for Intra-European Travel”, nearly “45 percent of those surveyed intend to plan their next trip online, using travel review websites (18 percent), destination websites or social media (12.7 percent), and hotel websites (the remaining 10 percent) (11.8 percent)” (Stylos and Zwiegelaar, 2019). “This is supported by consumer research conducted by SAS, a pioneer in marketing analytics, in the EMEA region, which found that 70% of new digital consumers want to continue using digital services after the lockout”. It is expected that the industries and organisations who are successful in retaining these clients over the long run would reap the greatest rewards.

“Using fresh tactics to reimagine the hotel’s spaces is another approach to increase exposure while also enhancing profits. Hospitality companies have been more innovative in their methods to attracting new customers, and they have integrated new business models into their strategic objectives” (Benabdallah, 2020). There are a variety of business model methods to choose from, including renting out day rooms, converting spaces into co-working spaces, providing facilities for television and film production, and even renting out space to schools for educational reasons.

“As a result, many hotel developers are concerned about how to continue with their projects while also managing the risks that come with starting a new company”. A new hospitality investment’s viability and liquidity, as well as future cashflow estimates and market unpredictability, are the most important considerations (Jones and Comfort, 2020). “People who intend to start new projects or who are currently in the planning stages cannot overlook the societal ramifications of the pandemic and, therefore, the influence on the future growth of the hotel industry”.

“Developers, financiers, and investors will need to examine six key pillars that will allow them to remain ahead of changes in demand while also creating value-added goods and services”. Whoever is capable of adjusting their hotel ideas and business strategies to the “New Normal” will be the ones who will be looking forward to the “New Future”.

Conclusion and implications

Thus, considering the context of Luxury Hospitality Industry, it can be inferred that implications of sanitary amenities, sustainable services and consideration on “Green” locations, trips closer to home that may lead to an increased usage of private transportation as well as distant employment opportunities and rural tourism should be taken into account when planning a vacation itinerary. Featuring these new aspects within the luxury service proposition might aid to the attractiveness of the service proposed. Nevertheless, when it comes to increasing sales of luxury services, the hotel and tourist industries need to develop a service quality proposition and formalise their service offerings that are tailored to the specific needs of the target market. As a consequence, strategic marketing may profit from implementing effective focuses such as attractive services and facilities that would attract tourists and travellers seeking better and exclusive offerings.

The need of high-quality service is often emphasised in light of such quality guarantees as long-term viability, sanitary conditions, and high-end products. Customers’ pleasure is strongly linked to service quality, making it an important aspect in the success of hotels and tourist attractions. Prior to developing solid purchasing habits, it is recognised as a vital aspect in the success of the hotel business. Many people feel that a company’s long-term financial success and customer loyalty are directly linked to the quality of its service over time. In order to improve customer service, it is essential to ensure that workers are well-trained and that their service experiences are regularly evaluated. These data show that dependability has a greater influence on service quality than any of the other factors. Consumers with luxury aspirations may be able to get better service proposals with greater hygiene and cleanliness in rooms and hotels that are of a higher level than the conventional because of cultural norms, quality of life, and socioeconomic standards.

Limitation of the Study

Accordingly, the article’s main shortcomings include a lack of comprehension of how the hospitality and tourism sectors effect business possibilities and developments, as well as a lack of consideration of a decent value offer for luxury clients. To the best of knowledge, no significant value proposition is mentioned in this paper.

Future Research Scope

Focusing on the most essential sections of the limitations might be useful for future research. It is thus necessary to assess potential strategies for reducing the demand for high-end services. Management in the hotel and tourism industries may utilise this information to monitor market trends and industrial performance.


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