Consumer trends that the hospitality industry cannot afford to ignore

Consumer trends that the hospitality industry cannot afford to ignore

In today’s operating environment, pivoting from an established business model and adapting marketing tactics to accommodate new trends are a must. Vineetha Sony, Head of Trade, OCO Global, explains why acting on consumers’ changing tastes, preferences and needs is essential for both success and survival.

The past two years have brought about sweeping changes in global consumer spending trends, forcing industries across the spectrum to reinvent their strategies at a matching pace to meet the converging needs of consumers and their own fiscal targets.

Dark kitchens
According to a recent report from our research partner Mintel, consumers, after having put their own needs on the back burner to prioritize public health and safety, are now emerging from the pandemic keen to re-focus on themselves, and brands will need to help them take center stage in the years to come.
For consumers who have gotten used to ordering online from the comfort of their homes and getting everything delivered in no time, convenience is paramount. As restaurants seek to find ways to offer their delivery customers the experience and levels of service they expect, one of the key developments in the supply chain domain has been the proliferation of dark kitchens.
In the UAE, hybrid, delivery-focused dark kitchen operators are transforming the F&B delivery scene. Brands such as Kitopi, Kitchen Nation, Kitchen Park and Kitch have found great success and are in the process of spreading their networks even further to cover most of Dubai’s population. As the rise of such hyper-local fulfilment channels poses a potential and pertinent threat to conventional restaurants, operators should consider devising creative strategies to be part of this model rather than try to compete with them. Apart from joining hands with delivery services and their dark kitchens, restaurants would also do well to adopt dark kitchens of their own by setting aside some space in their kitchens and focusing on making quick deliveries to their marketplace customers. Another scenario is for a hotel or restaurant with an under-utilized kitchen to collaborate with a dark kitchen platform and let them run their operations from this kitchen or a part of it.

Health, wellness and sustainability
Consumers are also becoming increasingly particular about health and wellbeing. The proliferation of health and lifestyle-related information and awareness during the pandemic has transformed the way consumers look at food and nutrition, including the way food and beverages are packaged. This has compelled fast-moving consumer goods (FMCG) companies to address how they present and package their products while also considering and possibly changing the materials they use in them. Increasing consumer demand is pushing brands to use more cruelty-free or vegan ingredients in food as well as cosmetics and cleaning products.
With sustainability one of the key trends set to drive most sectors in the coming years, making the transition from single-use toiletry amenities to reusable or plant-based ones is another essential move for hoteliers. The challenge of a certain section of customers still viewing single-use toiletry amenities as an indicator of luxury remains. However, this can be worked around with the help of clear messaging that conveys the fact that the use of these alternatives is a responsible initiative and not a cost-cutting measure.

Localism and social responsibility
Most studies on consumer trends show that shoppers are likely to buy from a brand that demonstrates social responsibilities and prefer to be associated with companies or brands that align with their values. In the same Global Consumer Trends 2023 report, Mintel states that over the next two years, consumers will continue to grow more connected to their local environment as the world faces rising geopolitical and financial insecurity. In this context, both international and local brands could benefit from collaborating with local businesses and coming up with schemes to support the specific needs and behaviors of local communities. Global brands can capitalize on this trend by highlighting how their local sales and profits are being used to improve the community in which they are present.

Diversified sourcing
Brands will also have to re-evaluate their supply chains and reliance on other countries due to global uncertainty. While this does not mean global supply chains will cease to exist, global brands must expect increased scrutiny by customers on whether they take their local commitments seriously.
From dark kitchens and sustainable practices to localism, wellness and supply chain re-evaluation, the combination of factors that are driving change in the consumer goods industry is extensive. For hospitality industry players, having a finger on the pulse of the market’s direction and a willingness to alter established business models and marketing tactics to suit the shift in trends matters more than ever before in today’s operating environment.

Vineetha Sony,
Head of Trade, OCO Global

Add to Favorites

Your email address will not be published. Required fields are marked *