In the midst of a transforming tourism sector in Portugal, a new era of disruptive tourism is awakening so the Ireland Portugal Business Network (IPBN) hosted an important conversation among experts in the hospitality sector moderated by former Chair of the IPBN Aoife Healy, entitled How to Tackle and Create Disruption in the Hospitality Sector. In the words of panelist Sofia Almeida, the overall takeaway is that “We have to adapt. And COVID was proof of that.”
Our expert panelists in hospitality management include Mark Fenelon, CEO of Clink Hostels, Filipe Santiago, Senior Partner and Managing Director of Consulting at BlueShift Hostels, and Sofia Borda de Água de Almeida, Assistant Professor at the Faculty of Tourism and Hospitality (FTH), Universidade Europeia.
Disruption in hospitality according to Mark, “It’s when pressure is forced on a business. Either innovate or you don’t. We’ve never seen as much disruption in hospitality as we have seen in the last three years.” In a business sense, Sofia said that it is “the interruption of a process. In My opinion, there are two interruptions…the first was the internet making a revolution in distribution [and booking]…and the second was the pandemic.” Filipe added that disruption begins with economic fundamentals. He cited the Blue Ocean strategy: “about the disruption of the market and creating new factors for you to compete…you need to find your own market space and have a captive market you can then play on…We are constantly looking for differentiation from our competitors.”
Filipe cited the story of Cirque de Soleil in their development of a totally new product from the framework of a traditional circus and charge from the perspective of a totally unique experience. Sofia followed suit by citing online teaching as a disruption brought on by the pandemic, which has become a new normal. Mark cited low-cost airlines as disrupting the airline market whereas the hospitality sector has not followed the trend— there are 80% three-star and higher hotels and there is room for cheaper accommodation to be revolutionized. He noted, “We are looking to bridge the gap between a traditional hostel and a hotel.”
Filipe said that in the industry, there are three areas that are the drivers of disruption: mindset, governance, and corporate culture while Sofia added that customization is necessary to thrive in the future.
In terms of sustainability, Aoife asked the panel if government incentives would hinder or make the change more widespread. Without them, Mark agrees that not enough change would be made. Filipe disagreed to a degree saying, "I am very doubtful of centralized planning…whenever the state tries to intervene and replace the market, it’s a disaster." Sofia added, “if the consumer is not driving the change, the industry has to do it itself.” She cited government involvement in the Alojamento Local (Airbnb model) making huge problems for Lisbon since their involvement. Mark added that Airbnb is so popular due to its low price point.
Panelists also discussed the growth of international brands, accessibility, generating value, licensing timetables, team achievements in the face of disaster, hospitality education, and the workforce needs of the industry at large.
A huge thank you to all the panelists for adding so much value to the IPBN Tourism Conference. Each brought a very interesting perspective to the table and inspired a room full of captivated attendees at the Universidade de Lisboa.
Following the IPBN’s Blue Economy Conference in Sep 2021, there have been many milestone achievements worth mentioning. However, steps in the right direction need to be made more quickly and more often as alarming climate disasters continue to ravage the planet.
Your business can benefit from being involved in this free world-class management consulting experience program! The close for submissions is early next week, so be sure to take advantage of this incredible opportunity for your business, and for the benefit of the students!