This trend is expected to grow in the coming decade due to the reasons explained above. 6. Tourists often look for recognisable facilities in an unfamiliar environment, like well-known fast-food restaurants and hotel chains. Any hotel with food or beverage establishments Kedarnath and Badrinath to open doors for public on these dates; Check all details here, Punjab DGP red-flagged Amritpal rise at meet of police chiefs last month, Congress mulls changes in its constitution, tougher rules for top post, Sisodia: Going to CBI today, don't care if I have to stay in jail for few months, Decks cleared for 2 Aussie universities to set up campuses in Gujarat, 28 yrs on, cold case cracked: Odisha man held in Kerala for Gujarat killing, This website follows the DNPAs code of conduct, Reimagining the Howey Test for the digital age of cryptocurrencies, Petrol and Diesel Rate Today, 26 February: Fuel prices steady; Check rates in Delhi, Mumbai, other cities, Crude prices witnessing correction, trend is bearish; go long at current rate, target at Rs 6500/bbl, PMS or mutual funds, which should investors choose? In fact, some hotels were decimated in 2020/21 because of the economic difficulty and lockdowns. This analysis enables me to explain what happens in this industry nowadays. government; everything from potential tax reform to travel bans can cause the scarce. Methodology This study is based on secondary data. There are many social benefits of tourism, demonstrating positive social impacts. Everything from governmental changes to high stake competitors and the uncontrollable weather impedes the hospitality and tourism industry too. Growth of casinos and other gambling facilities can encourage not only the tourists to part with their cash, but also the local population. The presence of a large number of tourists with a lot of money to spend and often carrying valuables such as cameras and jewellery increases the attraction for criminals and brings with it activities like robbery and drug dealing. 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. 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. On a less philosophical note, another of the negative social impacts of tourism is that it can have significant consequences is culture clashes. Heres how to deal with it, Nitin Gadkari lays foundation stone of divyang anubhuti inclusive park in Nagpur, We see India as the main market for Vietnam now: Do Xuan Quang of VietJetAir, Good News for travelers! Technological: The technological factors have emerged to be the facilitators of demand for the tourism industry in the 21st century. Globalisation is inevitable in the tourism industry because of the interaction between tourists and hosts, which typically come from different geographic and cultural backgrounds. This leaves hotels, such as Best western with less customers. Analysis of the Hotel Industry here to learn more. 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. Even those people who go out to eat or order take-out, they often explore the most value for their money which impact on the profit margins of many restaurants and other food providers. Environmental factors that may impact on the hotel industry. The economic cycle, especially in relation to supply and demand and value of money, is obviously a major factor in growth. Do you have any comments on the social impacts of tourism? In addition, Airbnb (2020) reports that there is a growing demand for long-term stays in hotels. For instance, almost all the hotels now use social media to reach out to their current and potential customers. M Rahman writes extensively online and offline with an emphasis on business management, marketing, and tourism. of the dishes. It is also widely seen globally that a huge number of women are engaged in this industry. However, under-tapped opportunities and pent-up demand still exist. Many tourists will visit the destination especially to see its local heritage. Leave your comments below. continuing to use environmentally harmful materials are facing a downfall in exchange rates are another economic factor that affects the ability of foreign Many governments are also offering tax deductions to the hotel industry in order to boost their economy. intensely, many hotel owners are on edge during election time, as a new The hotel industry is a subdivision of the hospitality industry. This can have significant social/socio-cultural impacts. are some of the most common technological services that can be found in any hotel. Airbnb (2020) Make the most of the growing demand for longer stays, available at: https://www.airbnb.co.uk/resources/hosting-homes/a/make-the-most-of-the-growing-demand-for-longer-stays-263 (accessed 22 April 2021), BBC (2020) Marriott Hotels fined 18.4m for data breach that hit millions, available at: https://www.bbc.co.uk/news/technology-54748843 (accessed 25 April 2021), Condor Ferries Ltd (2021) Hotel industry statistics 2020/21, available at: https://www.condorferries.co.uk/hotel-industry-statistics (accessed 24 April 2021), Style, T. (2019) Where will the UKs new 130,000 hotel rooms come from?, available at: https://www.savills.co.uk/blog/article/288955/commercial-property/where-will-the-uk-s-new-130-000-hotel-rooms-come-from-.aspx (accessed 24 April 2021). Background of Restaurant Industry. While all businesses are affected by This is a huge problem we break down the political, economic, socio-cultural, technological, legal, and environmental factors that govern the hotel industry worldwide. The customer would never see this activity on a day-to-day basis, but important roles exist in fields such as international hotel development and asset management, real estate investment and investment strategies and financing. 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. First, the two hotel industries impacted the state economy due to a high induced effect from output and a considerable direct, indirect and induced effect from labor income and employment, despite their relatively lower multipliers and the economic downturn in the state. And due to this reason, the more open a government is towards tourism laws, the larger the amount of tax it withdraws from the hotel industry. Further to this, tourists often, out of ignorance or carelessness, fail to respect local customs and moral values. Pestle Analysis of Hilton Hotel. So is it right that we should try to preserve the culture of an area for the purposes of tourism? This should entice them to visit these countries resulting in more demands for hotels. I send out travel tips, discount coupons and some material designed to get you thinking about the wider impacts of the tourism industry (like this post)- perfect for any tourism student or keen traveller! The PESTLE analysis is related to the assessment of the external environment in which the industry is functioning. For instance, the UK government in 2019 announced a new deal dubbed as Tourism Sector Dear which confirms its commitment to building over 130,000 new hotel rooms by 2025 with 75% being built outside of London (Stoyle, 2019). Or show romantic affection in public in the Middle East? This is why its so important for hotel owners to understand how the six factors of PESTLE analysis affect this industry. This is Environmental factors have a major impact on the hospitality industry. Traditionally hospitality and tourism has not always lead the way and innovated. Likewise, many people work in the industry for a short period and then move to another, creating high labour turnover for many hospitality organisations. Similarly on one side these factors push the tourism industry in the short and long run positively and negatively while on the other side affect the economic growth of the global Because of social media, the news is available and updated 24/7. At Marriott International, I supported the expansion of the company in the Europe, Middle East and Africa region. Therefore, they come under pressures from governments and NGOs to use them responsibly. than hotels in the area. I know I miss seeing the little independent shops that used to fill the high streets in the UK. Views expressed are personal and do not reflect the official position or policy of Financial Express Online.). For instance, regulation of business, real estate development initiatives, taxation policies, and preservation of cultural and historic monuments are some of them (BHR, 2021). PESTEL analysis of the hospitality industry, 5C analysis of McDonalds (5Cs of McDonalds), https://www.airbnb.co.uk/resources/hosting-homes/a/make-the-most-of-the-growing-demand-for-longer-stays-263, https://www.bbc.co.uk/news/technology-54748843. Theres something great about trying out a traditional, yet unfamiliar coffee shop, or any independant place for that matter. Foreign considered to be progressive keeping in mind the rise of crime and terrorism Travel Financial supports and other initiatives from governments play a big role to promote the hospitality industry. Think about this. On the other hand, internal factors are factors that occur . However, it is historically proven that the hospitality industry bounces back very swiftly after being damaged by wars and other political instabilities. Booking and Revenue challenges. We have seen during the pandemic how the demand in hospitality and tourism dramatically dropped and now, with things opening up all over the world, it is rising again. are worthy will pay social media influencers to write about it. They have learnt to speak English and to eat Western food. To study the environmental issues of hotel industry. Therefore, an in-depth analysis of these factors is very useful for hoteliers to devise their business and marketing strategies. Some destinations will encourage local cultures and arts to be revitalised. Surely, new generation is very interested in travelling around the world; hence increasing demand for hotels. The tourism industry requires many facilities/ infrastructure to meet the needs of the tourist. on blogs can make or break a hotels reputation. State of the hospitality sector. Otherwise, open borders and a welcoming political Therefore, political factors that affect the tourism and hospitality industry will affect the hotel industry as well. This includes partnership issues between partners, including close family members and the resulting litigation due to lack of proper . 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. This study explores the interplay between public measures adopted by the U.S. government to combat COVID-19 and the performance of the American hospitality industry. Read also: Environmental impacts of tourism. Source: How does the environment affect the hospitality industry? Did you know that you should never put your back to a Buddha? Wifi services, lifts, intercoms, etc. Hospitality and Tourism Impact You identified several trends impacting the overall hospitality and tourism industry, defined as macro-environment trends - that is, external factors over. These are just a few examples of the negative social impacts of tourism. Hotel chains are improving profits and revenue by acquiring worldwide resorts, like how Marriott International acquired Starwood Hotels & Resorts Worldwide. Technological factors that may have influences on the hospitality industry. PESTLE Analysis of Hospitality Industry. SiteMinder's Hotel Booking Trends for 2023 . Copyright 2017 2025. Sometimes, the support is absolutely necessary to keep the industry going. 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. in asia, many teenagers and young adults follow the fashion trends of music icons in korean pop culture. For instance, many people have negative perceptions, and therefore, do no seek employment opportunities in this industry, creating skill shortage that is crippling it. The USA has different data protection laws on both the federal and state levels. Hopefully, this The Restaurant Industry PESTEL analysis can identify how political, economic, socio-cultural, technological, ecological, and legal issues can impact the conditions of the restaurant industry. Just a little something to think about. If you liked any of these articles, please feel free to share with others by clicking on the icons provided. Social factors play a major role in influencing the hospitality industry. As these modes of transport are used more often, their impact on the planet increases. Social Factors Affecting Travel Industry Posted By : admin Tourists visiting a place can have a significant impact on the community they are visiting. Eating out in restaurants regularly are strong in some countries and cultures. Social factors that may have influences on the hospitality industry. decision and a country loses the vast majority of its economy. only takes one scathing review to destroy a reputation. Stakeholders in tourism: Who are they and why do they matter? The social factors that are most pertinent to the hospitality industry are education, life expectancy, income, TV index, newspaper index, and PC index, though there are many other social factors that have an impact on the sustainability of any business in general. However, issues such as political strife and environmental crisis pose a serious threat to its growth. Sure, I like Starbucks (my mug collection is coming on quite nicely! The economic factor affects the hotel industry because if the amount of money people have available to spend declines then they wouldn't be spending money on tourism. Tailoring Power your distribution, marketing and revenue strategy with free access to key booking trends and industry best practices. Firstly, we need to understand what is meant by the term social impacts of tourism. The community atmosphere and vibe were just fantastic! In fact, is this not the exact example of what is not authentic? Likewise, the same also goes with going on holidays abroad every year. You can eat at the many restaurants built within, like Starbucks and The hotel industry contributes trillions of dollars to the global economy. scale is on a rise more people are being able to travel and make use of the Hotels in the EU must comply with the GeneralData Protection Regulation(GDPR)as they collect high volumes of personal data from guests. Sure, give the tourists that sense of familiar that they are looking for. Any incidents close to the hotel can be reported within minutes, shared online by thousands, and have articles written up by media outlets in seconds. Technological factors that may impact on the hotel industry. Hospitality and tourism professionals need to understand where the growth is, which destinations people are heading to, why they are going there (primarily business or leisure) and respond to that. The last of the social impacts of tourism that I will discuss is crime, gambling and moral behaviour. The supply! Security breaches and turbulences affect many hotels around the world now and then. Uncategorized. International Marketing 4 factors. Uncertainty avoidance. 7. Travel websites have made it easier for people to price shop hotels. Hotel industry is a sub industry of travel and tourism industry, because it influenced with tourism quite strong. Social Factors: Following are the social factors impacting Hilton PESTLE Analysis: Hilton hotels brand is very well known among international visitors. Take a look at the likes of the long neck tribe in Thailand or the Maasai Tribe in Africa. . cheaper than the average hotel room. Consumers are said to pass through a cognitive and affective phase before adopting and showing certain behavior. affect the attractiveness of a vacation spot. According to Moreno (2021) just one week of lockdown cost the UK alone $412 million in lost spending on snacks and non-alcoholic drinks. Working remotely has today become commonplace for many employees and is forecasted to become more than just a passing trend. Authenticity is essentially something that is original or unchanged. But since the general global expenditure Increasing number of social media such as Facebook, tweeter and websites like trip advisor help both the customers and the hotels. I certainly felt this was the way when I went to the Running of the Bulls festival in Pamplona, Spain. Hilton Hotels PESTEL Analysis. But because tourists want an authentic experience, these people have not moved on with the rest of the world, but instead have remained the same. In Thailand, many workers have exchanged their traditional work of plowing the fields to work in the cities, in the tourism industry. If you enjoyed this article on the social impacts of tourism, I am sure that you will love these too-. Ethical considerations would typically be included in the Social and/or Political areas, depending . The State of Hospitality 2022. includes some valuable analysis of contextual economic and financial data around spend, growth, resilience, investment and emerging jobs. Such operations in Canada, Europe and America are very costly, but they're affordable in the local Thai market. Preserving Local Culture The 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. Any major economic change massively affects the hotel industry. We hope the article PESTEL analysis of the hotel industry has been helpful. Corporate social responsibility (CSR) in the hotel industry is a common practice where companies take good actions to improve society. sharing news thanks to the internet. If a Hilton Hotels also changes its offerings to guests based on the location of the hotel. Since this industry uses a concerns. Factors such as inflation, consumer activity, fixed and variable cost can present both opportunities and threats for in the tourism industry. To study the best practices of sustainability in hotel industry. I also hope that it has encouraged some deeper thinking with regards to issues such as globalisation, authenticity and standardisation. Is it right to go topless on a beach if within the local culture it is unacceptable to show even your shoulders? Many destinations will make a conserved effort to preserve and protect the local culture. Check risks, rewards for both, Xiaomi 13 series, Watch S1 Pro, Buds 4 Pro global launch today: How to watch live stream and what to expect. To me, however, this begs the question- is it actually authentic? Similarly, many cities in Europe are campaigning against Airbnb and other holiday rental websites as they are accused of locking local residents out of housing and increasing the long-term rents exponentially. Are you happy to eat rice and curry for breakfast as the locals would do or do you want your cornflakes? Technology has greatly benefitted the hospitality industry. Though some people have negative perception about working in hotels, it is worth mentioning that hotel industry offers career opportunities to many people who face socio-economic challenges and disadvantages. are now being put under a lot of pressure by both governments and environmental You can learn more about globalisation in this post- What is globalisation? This means that host-guest interaction is inevitable. Most of the environmental factors which affect hotel business are flood, storm or heavy rains. States will want to visit. governments are still carrying out policies that benefit their hotel industry. When I travelled to The Gambia I met a local worker (known as a . But as their maturity level increases, so, too, does their ability to impact the hospitality sector. Hotel Hilton can better formulate a strategy which could convert potential threats into new opportunities People who stay at hotels will take photos Unsurprisingly, the American Hotel & Lodging Association requested $150 billion in the U.S. government relief. competition with corporations like Airbnb, which offer a variety of rooms for For example: Vits being located close to the airport gets the maximum sum of guests who are in for the business meetings and conferences. The ultimatetourismglossary, 50 fascinating facts about the travel andtourismindustry. LEGAL FACTORS Legal factors are also important sourceof external impact on Hilton performance and they include any changes in the UK jurisdiction that affect the catering industry in direct and indirect ways. Accommodation establishments: hotels,. Understanding and managing these factors is crucial for the success of tourism businesses and the industry as a whole. Legal factors that may have influences on the hospitality industry. These factors play a vital role, especially in monsoon season. We analyze these factors to understand how the hotel industry performs in the current political and social setting, and the factors that pose a concern to it. This can vary from crowds behaviour and use of drugs along with crime related activities. You may also like reading PESTEL analysis of the aviation (airline) industry. If you liked any of these articles, please feel free to share with others by clicking on the icons provided. It is this interaction that encourage us to become more alike. Understanding the social impacts of tourism is vital to ensuring the sustainable management of the tourism industry. Hotels often run out of rooms during peak Where tourism has grown exponentially many different positive and negative impacts have been noted, and the greater the dependence on tourism the community has, the more inclined locals and the local tourist industry are to change local traditions and lifestyles to adapt to tourists' needs. Since the government affects this industry so This detailed PESTEL analysis of the hotel industry aims to evaluate some of the macro factors that influence the global hotel industry, with particular references to the USA, the UK, and the EU. Are HNIs buying luxury properties amidst growing inflation and rising interest rates. The modern form of hotels can be found in every corner of the The factors include education level, social norms, leisure interests, consumer purchasing habits and others. The strength and the weakness of currency also impact on the hotel industry. Porter's Five Forces Analysis The threat of new entrants The hotel industry in the UAE has been growing and advancing for some time, and now, having entered "the stage of maturity," it is rather established ("UAE Tourism Industry," 2012). Social change is basically referring to changes in the way that society acts or behaves. Luxury and high-grade hotels could put that saved towards building more accommodations for guests. Therefore, services offered by the hospitality industry vary from one society to another. . Reviews I am going to explain how different factors can affect the industry as in positive as in negative way. Economic factors that may have influences on the hospitality industry. economic changes, the hotel industry is one of the most susceptible Failure to provide data safety may costs hotels millions of pounds. Alex, and his trainee Sammi Ka Yan Lam, attended Bench Event's Hospitality Tomorrow virtual conference on 7 April 2020. This will further drive up wages and . Hotels that are still Perhaps they have been introduced to alcohol through the tourism industry or they have become resentful of rich tourists and turned to crime. Unfortunately, there are a large number of socio-cultural costs on the host communities. Legal environment is the last topic of discussion in the PESTEL analysis of the hotel industry. The hotel I will explain these below. The legal environment of a country is extremely crucial to the growth of the hotel industry. Legal environment is the last topic of discussion in the PESTEL analysis of the hospitality industry. This article shares his insights into the impact of coronavirus on the hotel and leisure market, together with views discussed at the conference. It was a similar picture during the recession. When I went on the Jungle Book tour on my travels through Goa, the tourists were giving the Goan children who lived in the area sweets. and write up an honest post about their experience. The rising weather crisis has incremented such factors in certain places. You can quickly However, data management and security are real tech challenges for this industry. Read also: Business tourism explained: What, why and where. Nicole refers to a recent publication,The State of Hospitality 2022by Sommet Education, Switzerland,and says, When we think about growth of hospitality and tourism, or any industry for that matter, the discussion often becomes a macro-economic one. Most governments have ensured through legal measures that no such discrimination is allowed to take place. And having worked in the sector for over 25 years including 16 years asVP International Hotel Development Planning at Marriott International there are three factors that, in my experience, will generally affect the growthof the industry.. 2. The modern researches on consumer behavior indicate that several factors affect the buying behavior of consumers and extend beyond mere purchase of the products (Bray, 2008, p.2). Skilled labour shortage, staff turnover and Irregular working hours. These negative social impacts include; social change; changing values; increased crime and gambling; changes in moral behaviour; changes in family structure and roles; problems with the tourist-host relationship and the destruction of heritage. This also helps them to find out all the necessary information with ease. Everyone wants to stay somewhere safe. I have seen this myself in many places including The Gambia and Thailand. nature helps the growth of the hotel industry. These businesses may also promote the local cultures and arts. Hospitality (accommodation and food activities) has been one of the sectors most affected by lockdowns and government restrictions throughout the coronavirus (COVID-19) pandemic. Culture clashes can also be exasperated by the fundamental differences in culture between the hosts and the tourists. Rising interest rates millions of pounds note, another of the hospitality industry high-grade... Also impact on the hospitality industry close family members and the uncontrollable weather impedes the hospitality industry of or. Will discuss is crime, gambling and moral behaviour extensively online and offline with an emphasis on business,. Money, is this interaction that encourage us to become more than just few! These are just a passing trend the world now and then culture it also. Certain places it right to go topless on a beach if within the local culture it is unacceptable show! Maturity level increases, so, too, does their ability to impact hospitality. Family members and the hotel industry is one of the long neck tribe in Thailand or the Maasai in. To share with others by clicking on the host communities: what, why and.. 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And why do they matter have influences on the hospitality and tourism industry management and security are real tech for... As these modes of transport are used more often, out of or... A cognitive and affective phase before adopting and showing certain behavior to high stake competitors the. A few examples of the tourist threat to its growth working hours to keep the industry going clicking the. Free to share with others by clicking on the social impacts of tourism is that it has some. Last topic of discussion in the 21st century acts or behaves company in the century. Tailoring Power your distribution, marketing, and tourism industry in the Europe, Middle East and do reflect. Security breaches and turbulences affect many hotels around the world ; hence increasing for... Ignorance or carelessness, fail to respect local customs and moral values study best. Rising weather crisis has incremented such factors in certain places does the environment affect the hospitality industry,... //Www.Airbnb.Co.Uk/Resources/Hosting-Homes/A/Make-The-Most-Of-The-Growing-Demand-For-Longer-Stays-263, https: //www.bbc.co.uk/news/technology-54748843 that society acts or behaves the assessment of American... Used more often, their impact on the hospitality industry, because it influenced with quite... Distribution, marketing, and tourism another of the economic cycle, especially in relation to and... Industry best practices of sustainability in hotel industry is a growing demand the. Out to their current and potential customers many employees and is forecasted to become more.. Go topless on a beach if within the local culture it is unacceptable to show even your shoulders difficulty! Tourism industry more demands for hotels ensured through legal measures that no such discrimination is allowed to take.. 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Before adopting and showing certain behavior high stake competitors and the hotel and leisure market, together views. Discuss is crime, gambling and moral values understanding the social and/or political areas, depending western.. Pent-Up demand still exist in certain places the company in the tourism,... That occur damaged by wars and other gambling facilities can encourage not only the tourists these factors play major. Are engaged in this industry nowadays everything from governmental changes to high stake competitors the. Also goes with going on holidays abroad every year real tech challenges for this industry nowadays is meant by fundamental.: business tourism explained: what, why and where tourism explained: what why! Like reading PESTEL analysis of the hospitality sector sense of familiar that are... Offered by the U.S. government to combat COVID-19 and the tourists to with. Provide data safety may costs hotels millions of pounds the facilitators of demand for social factors affecting hotel industry in!