“Hospitality”, in many people’s minds, is strongly connected with leisure. The sector is far broader than this, however. For many organisations, day-to-day operations would be impossible without the support of some element of the hospitality sector. Whether you’re booking a hotel for your summer holiday, a conference suite for a business event, or a restaurant for a family reunion, you’ve interacted with the hospitality industry.
- What is Hospitality?
- Defining the Hospitality Industry
- Hospitality: A Complete Overview of the Sectors
- Top Hospitality Trends
- The Must-know Hospitality Marketing Trends
- The Latest Hospitality Technology Trends
- Why Revenue Management is Important Within the Hospitality
- Everything to Know About Hospitality Management
- Free Tips on Revenue Management & Hotel Marketing Strategies
- More Related Industries
The hospitality industry is unique among other industries in both its breadth and pervasiveness throughout everyday life. From accommodation such as hotels and serviced apartments, to catering and entertainment, to travel agents and cruise operators, the hospitality industry plays an important role in both leisure and business. Most sectors are dominated by a very small number of firms — a handful of big names. Because the hospitality industry is so varied, however, the number of well-known businesses involved is also impressively large, including international hotel and restaurant chains, travel operators and many, many more. In this article, you’ll find out more about the different sectors that make up the hospitality industry.
Despite its varied and multifarious character, the industry does have two main defining features. One is its reliance on leisure and luxury activities and services rather than basic physical needs, making it vulnerable during times when the economy is struggling. The other is its chief focus: customer satisfaction. You could certainly make the case that this is true for virtually any business — after all, without satisfaction, an organisation would quickly lose customers. That said, this particular industry is more heavily reliant than any other on customer satisfaction; because the sector is chiefly sustained by luxury and leisure-related activities, customer satisfaction goes from being a marketing tool to the main service on offer.
The hospitality industry can be divided into three general sectors: accommodation, food and drink, and travel and tourism.
Hospitality: A Complete Overview of the Sectors
This hospitality sector deals with providing places for people to stay. These range from basic lodgings intended for stays of one or two nights, such as a motel or youth hostel. These might offer facilities such as shared dormitories or small private rooms containing minimal furnishings. On the other end of the scale are establishments such as luxury hotels and resorts offering higher-end facilities, as well as serviced apartments which may be used for longer-term accommodation.
Bed and Breakfasts
The bed and breakfast or B&B is a fixture of the budget accommodation sector. As the name suggests, guests at a bed and breakfast receive lodgings in a shared or private room and at least one catered meal per day.
Hotels are a little higher up the scale than bed-and-breakfast accommodation. Rooms may be basic, with access to a shared bathroom; luxury hotels offer large suites. Some hotels offer extensive facilities and services, such as spas or gymnasia.
Motels focus on short-term lodgings, often aimed at those taking long journeys who need a place to break their trip for a night or two. Facilities tend to be basic and practical, although there are higher-end chains and “theme” motels have their fans.
Popular with younger guests and other budget travellers, hostels offer basic comforts in a convivial atmosphere. Lodgings may include private rooms but often focus on large shared dormitories furnished with multiple bunk beds. Hostels often emphasise the social element with group activities.
Resorts range from the humble campground and caravan park to luxurious hotel complexes catering to guests’ every need. The difference between a hotel and a resort is the greater availability of external facilities such as recreation areas, private beaches, parks and so on.
A serviced apartment gives guests the comforts of home without having to worry about cleaning and caretaking. It is a full-sized apartment intended for longer stays but administered like a hotel room, with laundry, room service etc. provided for the guest.
In a timeshare arrangement you pay for the exclusive use of a particular apartment or other lodging but only for part of the year. Time sharing can be an economical solution for those who wish to stay at the same place every year.
2: Food and drink
The food and drink sector of the hospitality industry includes places serving fast food at modest prices to sophisticated restaurants. Pubs, wine and cocktail bars are also part of this sector. Entertainment establishments are often involved in providing food and drink. In some cases (such as in the case of a nightclub) food or drink is a major part of the entertainment on offer, while in others (for example in the case of a cinema) food and drink are additions.
Restaurants are among the most obvious examples of the sector. They serve food of varying quality, with a focus on dining rather than providing snacks. Some restaurants may also serve alcoholic beverages, particularly wineñ their primary focus is food.
Catering involves the provision of food and drink at a premises other than a restaurant or other eaterie. This might be the client’s home, workplace or another venue such as a meeting hall or conference centre. Catering ranges from simple sandwiches to banquets.
Bars & Cafés
Bars focus primarily on providing drinks in a social setting. They may also offer light meals and entertainment such as televised sports or live music or comedy. Cafés provide light meals and hot or cold beverages, typically but not always non-alcoholic.
Nightclubs focus more heavily on entertainment and social engagement than bars or cafés. Music is typically provided by a DJ but live acts may also perform and there may be other entertainments as well. Nightclubs typically serve minimal or no food, focusing on drinks.
Tea and coffee shops
Tea and coffee shops focus on providing hot beverages, often in a quiet and refined setting. They tend to attract a more mature customer base. As well as tea, coffee and other drinks, tea and coffee shops may offer snacks such as pastries.
3: Travel and tourism
The travel and tourism sector of the hospitality industry includes businesses that arrange transport and activities for travellers. This includes everyone from tour operators dealing largely with those who travel for leisure, to airlines and vehicle rental specialists who serve both leisure and business clients. In previous eras, these would have been primarily bricks-and-mortar firms; however, in the digital age, more travel is arranged online and new business models have evolved in response to this.
Travel agents arrange transport and accommodation for travellers. They are specialist consultants who work with individual clients to tailor a suitable package, which may include lodgings, activities such as tours, and travel arrangements such as plane tickets.
Tour operators specialise in arranging tours for their clients. This includes liaising with venue operators, tour guides and other key organisations and individuals. Tour operators are not usually involved directly with giving tours — this is the job of a tour guide.
Online travel agencies (OTA’s)
Playing an increasingly large role in the travel and tourism sector, OTAs perform many of the services offered by a traditional travel agency via a web-based platform. Their lower overheads and greater agility allow them to offer competitive prices for their clients.
Cruises combine both transport and accommodation. The purpose of a cruise is to provide a luxury hotel experience while afloat, combined with travel to exotic and interesting destinations. Cruises offer activities both onboard and on land, such as games and musical productions.
Car and vehicle rental is an important hospitality sector both for leisure and business. Vehicles range from chauffeur-driven luxury limousines to budget self-drive options. Rentals may be required for as little as an hour or two or for extended periods of weeks or months.
Casinos can be exciting destinations, offering games of chance and other entertainments. Casinos may offer automated slot machines and video games; they may also include more traditional gaming experiences such as card games or roulette. Many also offer food and accommodation.
Any business that’s involved in the hospitality industry must know the importance of keeping up with the hospitality sector’s emerging trends. In order to avoid disappointing customers and falling behind competitors, you need to keep your pulse on the constantly changing trends that are happening in the wider industry. In the article “Hospitality Trends: The Latest Trends in The Hospitality Industry” you will learn about the important changes that’ll be making an impact in this sector.
Hospitality marketing can be used for a number of purposes, but its main goal is to increase profits for businesses. To stay one step ahead of your competitors, and gain maximum exposure online, you must consider using the right digital marketing tools in your hospitality business. This can be done by studying online users’ behavior when they search for holiday accommodation and creating the most effective strategy based on customers’ needs. To give you a better idea, in the article “Latest Hospitality Marketing Trends” you will find the latest hospitality marketing trends.
Technology is rapidly changing the way businesses operate across sectors and the hospitality industry is no different. In an industry where customer expectations are high, the use of technology can overcome this challenge. After all, technology for hotel guests means an easier and more convenient experience as they can control the heating in the room and open curtains with their smartphones. This is the reason why keeping up with the emerging technology trends is essential. In the article “The Latest Technology Trends in the Hospitality Industry” you will find the latest technology trends that hospitality businesses should be aware of.
Revenue management in the hotel and hospitality industry has been given a new lease of life in the last few years. The primary goal of this concept aims to provide the right service or product to the right customer at the right price. For instance, have you ever booked the same hotel at different months of the year only to find that the room prices differ significantly? This is due to the fact that hotels never set a fixed price for their rooms in order to keep up with customer demand. Everything you need to know about the importance of revenue management can be found in this article, ‘Revenue Management; clearly explained!’.
When it comes to receiving a service, customers are no longer satisfied with just a thank you and a smile from their hosts. Proper etiquette isn’t enough to win them over. What your customers are looking for nowadays is an unforgettable experience. To succeed in hospitality management, you must keep your guests happy and engaged in order to prosper. The article, ‘Hospitality Management: The Essentials About Hospitality’, explains how you can start a successful career in hospitality management.
The big changes in the hotel industry and the constant evolution of digital marketing have resulted in a higher demand for a definitive guide to hotel marketing. There are many strategies that hotels can benefit from – if they are made aware of them. Marketing your business doesn’t have to be a time-consuming task as long as you choose the right channels. The ‘Free Guide: Revenue Management & Hotel Marketing Strategies’ will help hotel owners understand every aspect that goes into creating a successful hotel marketing and revenue management strategy.
As you can see, the hospitality industry is a rich and varied world taking in many different types of business. While somewhat sensitive to the vagaries of the economy, the hospitality industry is highly adaptive and fulfills important roles in the modern world.
The recent coronavirus outbreak has hit the hospitality sector particularly hard due to significant and unheard-of travel restrictions as well as nationwide lockdowns. It therefore comes as no great surprise that events such as the 2020 Olympics, the UEFA Euro and the ITB Berlin Travel Trade Show have been postponed indefinitely.
These very same scenarios are reverberating throughout the business community. As organisations curtail their operations and due to the fact that employees are concerned about job security, fewer trips are being planned. Of course, those who were hoping to book a holiday will be curtailing their plans for (at least) the immediate future.
Companies operating in hospitality, like restaurants and hotels are therefore experiencing an unprecedented drop in occupancy rates; some as high as 90 per cent. This has even forced a handful to cease their operations entirely. The main issue is that lower revenue generation has been compounded with continued operational costs. Owners are therefore being forced to deal with an entirely unfamiliar situation in regards to obtaining the necessary level of cash flow in order to remain solvent in such volatile economic times.
In the category “Corona” you find a selection of tips which helps businesses operating in the hospitality and travel industry to recover and prepare for better times.
Want to Learn More About Related Industries?
The hospitality industry is part of the travel industry and the hotel industry is part of the hospitality industry. All of these industries have in common that they are large service industries in the world and increasingly important in the modern age. But what is the difference between the travel and tourism industry? And what are all hospitality sectors within the hospitality industry? In the following articles you learn more about related industries.
- Travel Industry; An Overview of One of the Largest Service Industries
- Hotel Industry; An Overview of All Different Types of Accommodations
- Tourism Industry; Everything You Need to Know About Tourism
- What is the Difference Between the Travel and Tourism Industry?
- Airline Industry: All You Need to Know About The Airline Sector
- Aviation Industry: Everything You Need to Know About the Aviation Sector
- Everything You Need to Know About the Cruise Industry
- Space Tourism: 5 Space Companies That Will Make You An Astronaut