Survey - Hospitality industry slow to adopt the internet and ecommerce
A survey of the Australian hospitality industry shows that although the boom of online, ecommerce and digital media are well on their way to being powerful business strategies, the hospitality industry is still wary of online business and ecommerce.
The survey conducted by GoHospitality.com.au of more than 850 businesses highlighted that almost a third of the respondents don’t have a website for their business and more than 52 percent do not feel the need to buy or sell any products or services online.
The survey revealed that many businesses in the hospitality industry have been reluctant to adopt an online business strategy.
The survey, however, did show an increase in interest toward the utilisation of online marketing. Although more than half of those surveyed do not use the internet to buy or sell, 82 percent stated they would begin to engage in online buying and/or selling in the future.
Additionally, while 85 percent of business owners surveyed believe that a website is important for their business, a quarter of them do not believe their customers find them online. Furthermore, more than one fifth of business owners in the hospitality industry believe they are unaffected by the internet and mobile commerce.
GoHospitality.com.au Account Manager Kylie Tabrett said, “Although there is indication of attitude changing towards the internet and digital strategies in the hospitality industry there is still very little action going on. Although the internet is the preferred source of information for the hospitality industry their actions just aren’t matching their needs.”
“There seems to be something stopping business owners in the hospitality industry from integrating more with the internet. More than half of those surveyed claimed not to shop online for hospitality products and yet 96 percent believe it’s a viable channel – it’s very contradictory,” said Ms Tabrett.
When business owners were questioned about the internet and an increase to global competition via online businesses and ecommerce:
Just over one third did not believe the internet helped their business to compete globally in any way.
73 percent do not believe their business will be negatively affected by customers going online to shop with overseas suppliers.
One fifth were unsure whether or not their website helped them to compete with global competition.
“Although businesses in the hospitality sector appear confident about global competition only 26 percent surveyed said their business can compete with overseas pricing. The majority stated they believed they could only sometimes compete,” said Ms Tabrett.
Almost 40 percent of business owners shop online from overseas businesses with 86 percent of those online shoppers claiming to have saved money.
“We see business owners in the hospitality industry shopping online because it saves them money and yet those same business owners are claiming they do not believe their customers will go the same way,” said Ms Tabrett
Australian made products were said to be much more expensive with 74 percent of the surveyed business owners stating overseas products were cheaper but when questioned on quality vs. price 57 percent were confident that their customers would opt for quality even if it meant spending more money.
However, when asked whether the business owners themselves would opt for Australian made over price just over half stated they would in fact go with the cheaper option.
Ms Tabrett said, “The flood of coupon sites offering discount deals in accommodation, dining, and entertainment are signs that the industry is responding to a competitive local market with price conscious consumers. Naturally, businesses are branching out overseas to buy cheaper supplies in order to compete and increase profitability.”
“In addition to leveraging the internet to source products for their business, it seems the hospitality industry is yet to realise the real potential of the internet as a tool to future-proof their business and build on the engagement and loyalty of each customer. Otherwise a discount will trump quality every time,” said Ms Tabrett.
Business and non-business owners in the hospitality industry were surveyed about the effects of major issues in their sector including financial, environmental issues and cost of resources.
For further information or interviews please contact:
Phone: 02 9460 9200
About the survey
The survey of 866 business and non-business owners in the hospitality industry over the age of 18 years was carried out over the months of September, October, November and December 2011, and January and February 2012 covering all states and territories of Australia and representing all demographics.
GoHospitality.com.au is an online business directory servicing the hospitality industry. Owned and operated by Catch, an online division of Reed Business Information Australia, GoHospitality.com.au provides a comprehensive central online source containing the latest product, company and industry news updates.
KEY FINDINGS FROM THE SURVEY
Online trends and buying habits
76 percent reported the internet to be the number one preferred source of information to support purchase decisions.
The internet is a rich resource for hospitality professionals who claim to use the internet primarily for researching products & services (83.8 percent) – as well as finding suppliers of sought products and services (81.3 percent).
Of the hospitality professionals surveyed (non-business owners), 48.8 percent claimed they will change their buying habits to incorporate products from overseas.
Hospitality professionals surveyed agreed that while Australian products were more expensive (74.2 percent) – they also agreed that they were a better quality (63 percent).
Business owners also felt confident that their customers would opt for quality (57.1 percent) over price (42.9 percent).
Search Engine Optimisation
Of those businesses who reported having a website, more than half (51.8 percent) were confident of their SEO performance.
27.9 percent were certain their SEO was not good and 20.2 percent were unsure whether their SEO was good or bad.
Results indicate a significant portion of the hospitality market has an understanding or awareness of what SEO (and Internet marketing) is.
Hospitality industry outlook on the Carbon Tax
More than half (53.5 percent) of the hospitality industry believe carbon emissions will not be reduced as a result of the carbon tax.
52.5 percent of the hospitality industry claimed they would use alternative energy sources in the future due to the carbon tax.
91.2 percent of the hospitality industry claimed they do make an effort to reduce carbon emissions and 41.5 percent already use alternative energy sources for sustainability.
91.4 percent of the hospitality industry is concerned about environmental issues of which the majority worried about Water conservation and consumption, followed by climate change.
Future outlook for the hospitality industry
While 62.1 percent of hospitality businesses felt positive about the future of the industry, the remaining 37.9 percent of businesses were either unsure (27 percent) or did not think the future of the Australian hospitality industry looked promising (10.9 percent).
The main concern for Hospitality businesses in 2012 were reported as the Global financial crisis, followed closely by the declining retail sales in Australia.