Six Potential Challenges and Growth Opportunities in the Hotel Industry

By Stephen J. Renard President, Renard International Hospitality Search Consultants | September 24, 2017

A panel moderated by PwC's Scott D. Berman; Chris Cahill, CEO, Luxury Brands, AccorHotels; Steve Haggerty, Global Head of Capital Strategy, Franchising, Hyatt Hotels Corporation; Kevin J. Jacobs, EVP & CFO, Hilton; Elie Maalouf, CEO, The Americas, InterContinental Hotels Group, and Mit Shah, CEO, Noble Investment Group discussed the industry's growth potential as it related to geopolitical and economic shifts. Most have seen, and believe they will continue to see, moderate growth.

What do three hoteliers and the head of an OTA talk about over coffee? Plenty! Sebastien Bazin, Chairman & CEO of AccorHotels; Mark Hoplamazian, President & CEO of Hyatt Hotels Corporation; Jonathan Tisch, Chairman and CEO of Loews Hotels & Company; and Dara Khosrowshah, President and CEO of Expedia, took a break from the event's main boxing ring to sound off on the big issues affecting the hospitality and travel industries.

Here are six notable insights I took away from the CEOs.

  1. Guests Have Changed

    Today's travelers have to deal with ever-changing factors from online review
    sites to fears of terrorist strikes in major cities. Bazin, whose
    AccorHotels saw revenue fall after two attacks in France last year, noted
    that safety concerns don't seem to affect people's' desire to travel, but
    does affect where they go. "They go elsewhere," he said. "All the traffic we
    didn't get in France for the past 12 months went to Spain, Northern Europe,
    Amsterdam and London." And then there's the internet, with sites like Yelp
    and Travelocity offering reviews of everything from restaurants to hotels.
    "User-generated content is now like word-of-mouth on steroids," Khosrowshahi
    said. This can sometimes be bad, he said, but transparency can also be
    beneficial. "You have more choice than you ever had, and you have more
    information." But, he acknowledged, with increased choice comes some pricing
    pressure. "From an industry challenge perspective, there will be pricing
    challenges," he said. "But usually, lower prices spur demand, and I think
    you're seeing that happen.

  2. So Has Their Spending

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Coming up in June 2019...

Sales & Marketing: Selling Experiences

There are innumerable strategies that Hotel Sales and Marketing Directors employ to find, engage and entice guests to their property, and those strategies are constantly evolving. A breakthrough technology, pioneering platform, or even a simple algorithm update can cause new trends to emerge and upend the best laid plans. Sales and marketing departments must remain agile so they can adapt to the ever changing digital landscape. As an example, the popularity of virtual reality is on the rise, as 360 interactive technologies become more mainstream. Chatbots and artificial intelligence are also poised to become the next big things, as they take guest personalization to a whole new level. But one sales and marketing trend that is currently resulting in major benefits for hotels is experiential marketing - the effort to deliver an experience to potential guests. Mainly this is accomplished through the creative use of video and images, and by utilizing what has become known as User Generated Content. By sharing actual personal content (videos and pictures) from satisfied guests who have experienced the delights of a property, prospective guests can more easily imagine themselves having the same experience. Similarly, Hotel Generated Content is equally important. Hotels are more than beds and effective video presentations can tell a compelling story - a story about what makes the hotel appealing and unique. A video walk-through of rooms is essential, as are video tours in different areas of a hotel. The goal is to highlight what makes the property exceptional, but also to show real people having real fun - an experience that prospective guests can have too. The June Hotel Business Review will report on some of these issues and strategies, and examine how some sales and marketing professionals are integrating them into their operations.