Leveling the Playing Field to Attract the Airbnb Customer

By Dana Kravetz Firm Managing Partner, Michelman & Robinson, LLP | July 29, 2018

This year marks Airbnb's 10th anniversary. That's right, for a decade now, the hospitality industry maverick has been eating away at something that hoteliers hold dear – market share of lodging worldwide. And it has done so with abandon, finding a seat at the table amongst hotels and resorts in a space that was clearly ripe for disruption in the age of the sharing economy.

Since Airbnb's arrival on the scene, headlines have suggested real trouble for traditional hospitality players, big and small – couching the company as a significant threat and maybe even spelling doom for the hotel business. For those hoteliers who may have drank the "sky is falling" Kool-Aid, breathe easy.

Unlike the taxi industry, which has been devastated by the likes of Uber and Lyft, hotels and resorts continue to flourish – this despite Airbnb nipping at their heels. The proof: 2017 was yet another record-breaking year for the hotel industry here in the U.S., with the key performance metrics – occupancy, average daily rate (ADR), and revenue per available room (RevPAR) – higher than ever before measured by STR, the leading provider of information services to the hospitality segment.

The upshot: as Airbnb embarks on its second decade, the conversation amongst hoteliers should shift, and instead of overstated concern and worry, the emphasis must be on leveling the playing field by way of ongoing governmental regulation and proactive innovation by hotels and resorts to better attract the Airbnb customer.

A Booming Economy and Recession, All at the Same Time

You read that right; the economy is humming along, which is great news across sectors, including hospitality. With unemployment numbers at historic lows and given the uptick in household after-tax earnings, tourism and a resulting demand for hotel rooms are expected to rise well into next year.

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Coming up in March 2019...

Human Resources: An Era of Transition

Traditionally, the human resource department administers five key areas within a hotel operation - compliance, compensation and benefits, organizational dynamics, selection and retention, and training and development. However, HR professionals are also presently involved in culture-building activities, as well as implementing new employee on-boarding practices and engagement initiatives. As a result, HR professionals have been elevated to senior leadership status, creating value and profit within their organization. Still, they continue to face some intractable issues, including a shrinking talent pool and the need to recruit top-notch employees who are empowered to provide outstanding customer service. In order to attract top-tier talent, one option is to take advantage of recruitment opportunities offered through colleges and universities, especially if they have a hospitality major. This pool of prospective employees is likely to be better educated and more enthusiastic than walk-in hires. Also, once hired, there could be additional training and development opportunities that stem from an association with a college or university. Continuing education courses, business conferences, seminars and online instruction - all can be a valuable source of employee development opportunities. In addition to meeting recruitment demands in the present, HR professionals must also be forward-thinking, anticipating the skills that will be needed in the future to meet guest expectations. One such skill that is becoming increasingly valued is “resilience”, the ability to “go with the flow” and not become overwhelmed by the disruptive influences  of change and reinvention. In an era of transition—new technologies, expanding markets, consolidation of brands and businesses, and modifications in people's values and lifestyles - the capacity to remain flexible, nimble and resilient is a valuable skill to possess. The March Hotel Business Review will examine some of the strategies that HR professionals are employing to ensure that their hotel operations continue to thrive.