Eco-lodges may experience an uptick in occupancy rates post-Covid-19

Globaldata Travel and Tourism 9th April 2020 (Last Updated April 9th, 2020 14:17)

Eco-lodges may experience an uptick in occupancy rates post-Covid-19

Eco-lodges and accommodation types that are focused on environmental sustainability may experience an uptick in occupancy rates when the impact of Covid-19 lessens. The main contributor to this potential trend will be the millennial consumer segment. This segment tends to be the most concerned regarding their carbon footprint and will appreciate the inadvertent, positive environmental impact Covid-19 has created on a global scale.

It has been well-documented that Covid-19 is creating a positive environmental impact around the world. Pollution and greenhouse gas emissions have fallen across continents as countries try to contain the spread of this new virus. It remains to be seen if this is just a fleeting change or if it may be more permanent and lead to longer-lasting falls in emissions.

It is likely that consumers across the globe, especially millennials, will be encouraged by this trend and will look to carry on contributing to environmental sustainability when travel restrictions are lifted. A simple way to practice responsible travel is to stay in accommodation that promotes environmental sustainability. However, in general terms, the more an accommodation provider specialises in sustainability, the more expensive room rates become. This may act as a major barrier for travellers, especially post-Covid-19, where consumer confidence will have significantly declined.

According to GlobalData’s Q3 2019 Consumer Survey, 89% of global consumers are now interested in products that are environmentally friendly with 46% actively buying such products over products that do not incorporate sustainability. When looking at millennials specifically, active buyers grow to 49%, the highest percentage of all segments. As millennials now have one of the highest spending power rates out of all generations, they are at the forefront of many marketing strategies, especially in the tourism industry.

It is possible that the environmental impact of Covid-19 may create an increase in demand for eco-lodges. If this trend becomes a reality, multinational companies, operating in the sector, may seek to acquire smaller, eco-focused lodging providers in the future, as they look to diversify customer bases to increase market share. Independent or small-scale lodging companies may look to cheaper initiatives such as gaining eco-certification to attract environmentally conscious travellers.