The New York University School of Professional Studies Jonathan M. Tisch Center of Hospitality recently held a CEO think tank exploring how strong leaders adapt to change.
Moderator Gilda Perez-Alvarado, global CEO, JLL Hotels & Hospitality, started by asking the panelists how traveler behavior has changed in recent years and how they are responding to those changes.
“One thing that’s impressed us all is just the resiliency of the leisure traveler,” said Geoff Ballotti, president and CEO of Wyndham Hotels & Resorts. Travelers have been making up for lost time, he added, driving demand for this summer, into the fall and even next year. The demographic also is changing, he said, with younger, infrequent travelers seeking unique experiences.
“We all have to market to them in a different way — cast a wider net [and] expand our marketing funnels to appeal to these folks,” he said, noting that these travelers are often less concerned with branding. “We need to reintroduce them to our brands.”
Patrick Pacious, president and CEO of Choice Hotels International, agreed that experiential travel is driving the leisure segment, and upscale and soft-branded hotels are maintaining local names, “flavor” and food-and-beverage options. “Those are the consumers who want to not just go and get out — they want to go and experience the culture there,” he said.
Travelers also are seeking longer stays. As of 2019, Pacious said, 18 percent of all the consumed room nights were for more than seven nights. “But only nine percent of the supply is actually purpose-built for an extended-stay traveler,” he noted. “So in many cases, I think consumers are often seeking alternative models because they can’t find that purpose-built accommodation for them that does drive that longer travel.”
Jim Alderman, CEO of Radisson Hotel Group, Americas, said his company’s main focus right now is to assist in “thoughtfully staffing up as fast as possible” at both its managed and franchised hotels and to stabilize any deferred maintenance. Radisson reported a 10-point swing upward in its net promoter scores after a decline, he noted. “I think a lot of that was a lack of staffing at the hotels. It’s no fault of the owners. There’s no one to hire.”
Pacious agreed, and said that if labor costs increase at hotels in order to attract more workers, hotels will have to price guestrooms above what they were charging two years ago. “That inflation is going to creep in,” he said. “Even if it’s transitory, it’s going to show up in the price.”
Three Ways to Sell to Groups
While leisure travel is gaining momentum, business travel has taken a hit over the past year, and hoteliers have had to adjust their strategies to keep the groups coming in.
“Technology is absolutely playing a part in how we’re attracting group business,” said Sloan Dean, CEO and president of Remington Hotels. The company, he added, has evolved three strategies for attracting group business: “We’ve evolved how we sell, we’ve evolved what we’re selling, and we’ve evolved our contracting for what we’re selling.” Remington is using video and 360-degree imagery in virtual tours to give meeting planners a clear sense of the space. “So a lot of our meeting planners are not coming to the hotel,” he said. “They are virtually walking around with the technology that we have — mostly iPads — showing them the space.”
The company also is selling its outdoor spaces more than it used to, and in more creative ways, Dean said. “That’s part of the re-imagination of looking to the future. How can we monetize things that we didn’t before?” Remington also completely revamped its F&B program with menus that are more “customer-centric” and sustainable than traditional buffets, he said. “I think that’s something that we can hold on to. And quite frankly, it’s more profitable.”
Remington also has partnered with AllSeated, a platform that lets meeting planners design an event space’s layout for social distancing from their own computer — “and then we can work with the teams to make that come to life.”
No More Excuses
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