Corporate buyers are willing to pay sustainability premium say SilverDoor partners

UK: SilverDoor held its 2022 Partner Engagement Day earlier this week in London. SAN brings you some of the main takeaways from the event.

Held at 30 St Mary Axe, City of London, the event marked the launch of a sister company to SilverDoor – new consultancy Ariosi.

Over 140 senior decision makers from the agent’s network of over 4,000 real estate partners and clients were on hand for an afternoon of presentations and panel discussions.

Here are some of the key points that emerged from a series of roundtables:

• Many segments of the business travel market are booming
“Covid has really accelerated the serviced apartment market. More serviced apartments have remained open than hotels during the pandemic and our customers tell us they are bringing tremendous value to the business travel sector in the more flexible and personalized travel experiences they can offer. : people learned to love serviced apartments and many never did. returned to hotels after the pandemic. 2022 has been SilverDoor’s most successful business year and our partners have multiple openings underway in all of our regions around the world. This demonstrates that the corporate housing sector has not only rebounded, but has truly come back strong. »
Martin Klima, Chief Account Officer, SilverDoor

• “We are experiencing an unprecedented level of investor resilience, industry maturity, institutional appetite and a narrowing yield gap between hotels and serviced apartments. Serviced apartments are no longer the poor cousin. The continued increase in market share represents an opportunity for operators to improve their performance and profitability.
Joanna Cross, Chief Operating Officer, Ariosi

• Supply chain tackles sustainability, but we need to talk more about it
“Over the past 12 months, we’ve seen a real sea change in the appetite for emissions and carbon footprint reporting. The carbon footprint of suppliers contributes to companies’ calculations and selecting suppliers who demonstrate tangible reductions in their emissions is essential for companies in the race to zero. The first step to demonstrating this is to compare where you are now and the advice and guidance to help them take that first step is there and trustworthy.
Toby Roberts, Quality Assurance Manager, SilverDoor

• Customers are open to ‘Greenium’
“We are often asked: is the client company ready to pay the premium for improving sustainability? The resounding answer is that the most forward-thinking companies are increasingly so. However, in our experience, while many real estate providers are making great strides in sustainability best practices, they are not necessarily communicating those achievements in an effective or tangible, data-driven way. The industry needs to shout better about what it is doing from a sustainability perspective. We’re comfortable telling companies they have to pay more, and companies are open to those conversations, but it’s critical that they have the data to support those conversations.
Alex Neale, Partner Relations Group Manager, SilverDoor

• Customers want to work in collaboration with their suppliers
“We heard loud and clear that there is an openness among businesses, RMCs and TMCs to hear and share ideas on how the corporate travel and relocation industry can better work together to finding solutions to challenges such as rising fares and costs, emission reductions and the living traveler. It is recognized that successful solutions will not be created in a vacuum and there are places around the table for those who want to work together with authenticity and transparency.
Our customers report higher satisfaction rates when they have a choice and feel part of the process, they are eager to have these conversations with their supply chains and this gives us enormous optimism that together we will overcome the challenges and opportunities that the coming year will bring. ”
Victoria Jackson, Senior Marketing Manager, SilverDoor

Trends and forecasts for the coming year
• Accommodation rates remain high and travel buyers need to recognize that the great rates they enjoyed in 2020/2021 are truly a thing of the past. Rates for the 4th quarter of 2022 are up 25% compared to the same period last year (Source: SilverDoor).

• The leisure and tourism sector continues to influence accommodation availability, and the strong foreign exchange market for international travelers will keep occupancy dynamic through 2023. We expect volumes to remain healthy, but a solid pipeline of new openings improves availability in key 2023 locations.

“We expect customers to look more at costs over the next six to 12 months and we expect ‘discretionary’ and transient business travel – which hasn’t returned to industry-leading levels anyway. ‘before the pandemic – continue to be reduced. The tech industry in particular has seen a boom in global travel in 2022, but with the recent price hikes and heavy staff cuts in Twitter and Meta news, we can expect to see this slowdown in 2023. Travel are a cost of doing business. Accept it.”
Victoria Jackson, Senior Marketing Manager, SilverDoor

• Conscious travel is here to stay
“Sustainable travel is a major consideration driving the trend towards less travel and longer stays; there is greater internal discussion at the company level about whether temporary travel is necessary and whether online meetings replace in-person assignments. Customers are increasingly looking for a greener supply chain in order to reduce their own carbon footprint, meet their ESG goals and achieve net zero goals. The supply chain would do well to track, report and provide tangible data on its carbon reduction efforts, as well as its overall carbon footprint – starting now.
Toby Roberts, Quality Assurance Manager, SilverDoor

Seamless booking technology is key
“Technology is an essential component of business travel. Businesses want a frictionless journey from their enablers, including real estate agents and suppliers. Business travelers want more control over the booking process and more customers are asking for self-booking capabilities. Our customer panel unanimously agreed that there is a fundamental need for the serviced apartment sector to offer online booking capabilities at scale.
Hanish Vithal, CTO, SilverDoor

• Customers have an insatiable appetite for data
“Clients are extending bookings longer than ever, placing considerable importance on agent data tracking and trend analysis to inform and educate real estate providers on these market shifts. Analyzing supply, demand and pricing data will be key to steering resources in the right direction heading into 2023. The business buyer is often quite risk averse and wants to make an informed choice, we never have enough data, what is happening in the markets, the outlook for spending and trends. Pricing and availability data facilitates high-level benchmarking and corroborates price increases to reinforce truth. We’re comfortable telling companies they have to pay more, and they’re open to those discussions, but we need the data to support those conversations. Educating customers and managing expectations are paramount to helping them understand the reality of today’s market. »
Alison Willis, Customer Program Manager, SilverDoor