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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Guest Service: A Culture of YES

In a recent global consumers report, 97% of the participants said that customer service is a major factor in their loyalty to a brand, and 76% said they view customer service as the true test of how much a company values them. And since there is no industry more reliant on customer satisfaction than the hotel industry, managers must be unrelenting in their determination to hire, train and empower the very best people, and to create a culture of exceptional customer service within their organization. Of course, this begins with hiring the right people. There are people who are naturally service-oriented; people who are warm, empathetic, enthusiastic, pleasant, thoughtful and optimistic; people who take pride in their ability to solve problems for the hotel guests they are serving. Then, those same employees must be empowered to solve problems using their own judgment, without having to track down a manager to do it. This is how seamless problem solving and conflict resolution are achieved in guest service. This willingness to empower employees is part of creating a Culture of Yes within an organization.  The goal is to create an environment in which everyone is striving to say “Yes”, rather than figuring out ways to say, “No”. It is essential that this attitude be instilled in all frontline, customer-facing, employees. Finally, in order to ensure that the hotel can generate a consistent level of performance across a wide variety of situations, management must also put in place well-defined systems and standards, and then educate their employees about them. Every employee must be aware of and responsible for every standard that applies in their department. The April issue of the Hotel Business Review will document what some leading hotels are doing to cultivate and manage guest satisfaction in their operations.