The 246-room Crowne Plaza Lake Placid is located in the Olympic village, adjacent to the Olympic Center. It features 22,000 square feet of meeting space, a full-service restaurant, an indoor pool, a 45-hole golf course, a cross country ski and snowshoe center and a boat house beach club.

The Peregrine Hotel Omaha Downtown, Curio Collection by Hilton is slated to open later this year. It is an adaptive reuse of the 104-year-old World Building and will include 90 rooms, a rooftop bar and a restaurant.

In South Florida, the Hyde Beach House offers 265 one-, two- and three-bedroom furnished condominium units. Amenities include a personal concierge, a sports club, a private rooftop lounge, a fitness center and a health spa.

Chief Commercial Officer Chris Green spoke with Hotel News Now at the 2019 Hotel Data Conference about staff hiring and retention strategies, operating business as usual in a recession and managing the company’s portfolio of brands and independents. In fact, Green said 2019 has been a great year for Chesapeake.

“We’ve been building over the years into some great growth in our portfolio,” Green said. “We’ve added a couple full-service hotels, and we have four more deals pending to close for the remainder of the year. We’ve always seen that as times get tight, Chesapeake’s long history of solid, firm management has been sought-after in times when things start to slow down a bit.”

One of the management company’s newest properties is the Hyde Hollywood Resort & Residences, a 363-room condohotel in Hollywood Beach, Florida, that features one-, two- and three-bedroom suites. Green said Chesapeake operates in specific markets and focuses on full-service, upper-upscale hotels with a heavy focus on food and beverage and sales and marketing, “because that’s what we’re built to do.”

“We’ve always been (in) secondary or tertiary markets; we haven’t done a ton in primary markets,” he said. “We’re in Houston, Philadelphia and Atlanta, but really we’re talking about cities like Wilmington, North Carolina; Tampa, Florida; Pittsburgh; those markets where our expertise that’s been honed over all these years and doing that type of hotel is really valuable. We know our niche and how to play in it.”

While Chesapeake’s portfolio includes both brand-affiliated and independent properties, Green said with the exception of marketing efforts, the company’s management approach doesn’t really differ.

“Really the big difference between the branded and independent is the level you have to go to either on the e-commerce side or digital marketing or direct sales side,” he said, “because you’re not going to get brand contribution on the independent side, so you have got to be more aggressive in the e-commerce space making sure that you’re present where the brands have all that horsepower behind them with the loyalty stays—we’ve got to generate those stays on our own.”

NASHVILLE, Tennessee—The hotel industry is in an era where experience matters most to guests, which is why it’s important for hoteliers to find ways to create great experiences from the travel search phase to hotel arrival while making those efforts profitable.

During the “How guest experience pays off” panel on Day Two of the 11th annual Hotel Data Conference, speakers said it’s important to invest in every stage of the customer journey, and the booking journey has turned to a digital experience.

Chris Wilroy, SVP and commercial director, Americas, at Hilton, said his company is putting a lot of dollars into the “dreaming” stage, which “is that shopping and research phase down to booking, pre-arrival and post-stay,” he said.

One way Hilton is investing in this is by improving the search function on its website. It’s no longer hard to find a hotel in a specific city with a great Instagrammable dessert because the website has different features that allow guests to find exactly what they’re looking for, he said.

“We’re really changing the idea of search to enable more free-forming dreaming,” he added.

Chesapeake Hospitality has found success in serving up personalized content to meeting planners, according to Chris Green, chief commercial officer at Chesapeake.

The company uses aggregate search and then uses that data to create and send personalized offers to meeting planners, he said.

Choice Hotels International uses data to understand which hotels travelers might be interested in, such as its upscale Cambria and Ascend brands, and then uses that data to elevate those brands on the website to make sure those are the first types of properties they see to encourage them to book at one of those hotels, said Robert McDowell, chief commercial officer at Choice.

Wilroy added that Hilton also has a chatbot on its website to help guests with their travel decisions, and to walk them through the steps of booking travel on the website if it seems like they have been looking around for a long time. The automated bot has 25,000 conversations per week, he said.

On-property spend
Hotels are investing heavily in on-property experiences, and they of course want to find ways to maximize profits from creating and delivering those experiences.

When asked if it is more important to get guests to book a room at the right rate or spend money on multiple cocktails they will later post to Instagram, speakers agreed that the goal is to achieve both.

“If you can’t get them in the hotel at the right rate, they’re not going to be buying five $18 cocktails,” McDowell said.

The goal is getting them on property, and then where appropriate, getting them to spend on ancillary things such as rooftop bar cocktails, he said.

While getting guests to book at the right rate is important, Green said a hotel still has to have the experience guests want or they will take their wallet and buy a cocktail down the street.

“If you don’t have experiences that hold people to your hotel and offer them an opportunity to take (pictures and enjoy a cocktail), you’re so far behind the curve,” he said. “You have to have … a connection with your guests at every chain scale and have things that hold them in place that are interesting.”

Due to enhanced experiences and offerings, resort fees have popped up at some hotels, which some consumers are annoyed about. Speakers said the best way to address these fees is by being transparent with customer and owners.

Wilroy said Hilton is working to strike the right balance with resort fees, and McDowell added that it’s important to make sure the consumer knows what the prices are for the fees when staying at a hotel and the services they’re getting for paying the fees.

Experience takeaways
At the end of the discussion, speakers left attendees with their main takeaways for monetizing the customer experience.

McDowell: “Owners should understand and talk to the consumers.”
Green: “Household debt is way, way down. Think leisure…”
Wilroy: “…Pay attention to the digital front door, especially the revenue-management folks in the room,” he said, adding that they should pay attention to how prices show up for the customers.

REPORT FROM THE U.S.—There’s more to group business than the typical big-convention markets of Las Vegas; Orlando, Florida; and New Orleans. As other markets become burgeoning corporate hubs, they are attracting groups by offering a variety of hotel inventory to choose from, some with lower price points and many with ease of access through their airports.

These markets range from Detroit and Minneapolis in the Midwest to Savannah, Georgia, and Charlotte, North Carolina, in the South to Seattle and San Francisco on the West Coast.

“You are seeing a lot of very nice, new hotel product in some markets, and meeting attendees are looking for different places to try and experience,” said Steve Goodman, founder and managing partner at MeetingAdvice in Atlanta.

One of the “big stories” on the meetings front that is bringing a lot more group business to perennial favorite San Francisco is the four-year expansion of the Moscone Center, a $551-million project that was completed in January, said Jan Freitag, SVP of lodging insights at STR, parent company of Hotel News Now.

Following the reopening of Moscone, hotels in San Francisco marked a 36% increase in group revenue per available room for the first quarter of this year, according to STR data. Room rates were up 17% for group business during the same period, Freitag added.

Other markets on the West Coast that are attracting groups are Denver, Phoenix, San Diego and Seattle, said Julie Purnell, San Francisco-based managing director at CBRE Hotels Advisory. Some smaller markets that offer more price-sensitive alternatives include Bellevue and Spokane, Washington.

“These cities and others are getting creative in how they accommodate groups,” Purnell said. “They may even shut down streets to host groups who want to have big parties, have whole groups or conventioneers take over museums, or use piers for special events.”

Midwest markets
In the Midwest, Detroit has become more of a high-tech center, most notably with Google opening office space last November inside Little Caesars Arena downtown. Group average daily rates are around $170, compared with $225 in other markets, Freitag said.

“There are new boutique hotels in Detroit, it is easy to get to, and not as expensive as some other markets,” he said.

Chesapeake Hospitality’s Sheraton Detroit Metro Airport Hotel and Detroit Metro Airport Marriott both have seen their group business go up from last year and continue to grow, said Chris Green, principal and chief commercial officer.

Another Midwest locale experiencing its fair share of group business is Minneapolis.

Sharon Chicks, director of sales and marketing for The Emery Hotel in Minneapolis, said the city competes for groups against markets such as Raleigh, North Carolina; Louisville, Kentucky; Charleston, South Carolina; and Boise, Idaho, for groups.

The 229-room Emery Hotel has 4,000 square feet of meeting space and can accommodate groups of up to 150 for meetings, although more of the meetings tend to be geared toward 30 to 50 people, Chicks said.

“Minneapolis has matured,” she said. “We have the pro sports teams and college sports, culture, nightlife, restaurants, shopping, and we are easy to get to—all of which is important for holding meetings.”

Southern markets
In the South, the 249-room DeSoto Savannah in Savannah, Georgia, has seen a 9.5% jump in group business from last year, Green said. Another of Chesapeake’s hotels, The Ballast Wilmington in Wilmington, North Carolina, recorded a 10% increase this year in group bookings for meetings, he said.

“The top meetings markets have become extremely pricey, especially with the high cost of labor,” he said. “Markets like Savannah and Wilmington can be more competitive on price, and have a lot of history and interesting sites and nightlife to offer to groups, no matter where they are from.”

Groups are coming to these markets for corporate meetings, association meetings and training, he said. In part, that’s because the markets are easily accessible in a variety of ways; for example, many groups are driving in, he said.

“Our corporate group business will continue to keep growing because of all of the demand in these busy markets,” Green said.

Another southern destination that “checks all the boxes for a growth in group business” is Charlotte, North Carolina, said Robert Hannigan, GM of the 217-room luxury Kimpton Tryon Park, located in the city.

“A lot of groups have been to Atlanta or Orlando, and are looking for an alternative,” he said. “The city has a beautiful new downtown core with a lot of demand generators for those who want to hold meetings here.”

The hotel is located just a few blocks from the Spectrum Center, an indoor arena that is owned by the city of Charlotte and operated by its main tenant, the NBA’s Charlotte Hornets. The property is also close to the Charlotte Convention Center.

“You have corporate meetings and events going on in this city that are related to so many industries, such as banking, pharma, technology and automotive,” Hannigan said.

Meeting attendees also are flocking more and more to southern Florida destinations such as Fort Lauderdale and Miami.

“You are seeing a lot of new properties in the beach and downtown areas, and you have a choice of airports to fly in to,” Goodman said.

In the South, markets like Nashville, Tennessee, are “on fire,” and Austin, Texas, continues to be a great alternative to Dallas and Houston—both offering a variety of hotel, restaurant and entertainment choices, Goodman said.

Austin and Savannah also are in-demand markets for meetings events, Kimpton VP of Sales Telesa Via said.

“These areas are more off-the-beaten path cities and are investing and evolving rapidly to appeal to planners with new local group activities to showcase their cities,” she said. “Planners have hit the major markets with their groups and are now looking for something different, while also saving on costs.”

Planners want unique design with hyper-local elements, along with substantial meeting space to accommodate full groups and more intimate spaces for breakout needs, Via said. Also, hotels that stand out often have local partnerships with artists, musicians, artisans and breweries that they can easily tap into for breaks or receptions.

“A lot of the most popular group markets seem to have it all, and that is what meeting planners and meeting attendees are looking for when they plan events,” Goodman said.

The ability to make someone feel personally welcome—often with a gesture as simple as a friendly smile or a handshake—has long been a part of the hotel business.  From the front desk to the sales team, taking steps to forge that fundamentally human touch pays dividends.

In recent years, however, the proliferation of new tools and technologies has prompted an unwelcome shift. As lines of communication become more impersonal, and as it becomes easier and more efficient to get things done without seeing or speaking to someone in person, connection is all too often sacrificed on the altar of convenience. It feels like we have more ways to connect—but, in some of the ways that matter most, we are actually further apart than ever. They understand that as personal interaction becomes less frequent, it has, ironically enough, become more important than ever.

Savvy hotel owners and operators recognize this dynamic and are taking steps to address it. They have their work cut out for them, however. Because the concerning diminishment of personal engagement has accelerated as a younger generation of hospitality professionals—many of whom have become accustomed to a depersonalized digital standard for communication—enter the industry.

It’s ironic that one of the most popular communication apps of the modern age shares its name with a practice that some might mistakenly view as antiquated or unnecessary: FaceTime. Human connections matter. Personal relationships matter. And understanding how to re-emphasize personal engagement and recapture the irreplaceable benefits of face time is becoming an increasingly important skill for hotel professionals.

Technically speaking
Powerful and sophisticated new digital technologies have been an unquestioned plus for the hotel industry. New tech tools allow us to operate with new levels of efficiency and gain new insights into our markets and our properties. But it’s also changed the way we communicate. Our workforce is getting younger, and they communicate more often through their preferred methods of digital media and social platforms.

For all the game-changing benefits of smartphones and social media, there is a degree of anonymization and disconnection that begins to creep in when our primary means of communication becomes an impersonal digital thread. When fewer actual conversations take place face to face—or even over the phone—we lose something important.

One study has concluded that more than 90% of all communication takes place nonverbally—through body language. Is it reasonable to expect a sales team to optimize its results when it is working with only one-tenth of its communication potential?

Some hotel owners and operators are recognizing that, when it comes to communication, frequency is no substitute for quality. If they want to reverse this trend and consistently realize their full profit potential, they need to re-emphasize warmth, sincerity and genuine personal connections over the efficient-but-impersonal channels that new technology affords them.

The young and the restless
The lack of face time and reference for impersonal digital communications is most evident among younger employees—particularly those members of the all-important millennial demographic. The time to reverse this trend is now, before these younger employees ascend into positions of leadership and greater influence.

As remarkable as it sounds, many of these otherwise bright and promising young professionals have grown up without the face-to-face tools they need to engage with guests and fellow professionals on a personal level. Consequently, a significant number of hotel management companies are losing touch with the tried-and-true techniques that hotel professionals have used to connect with guests and sell hotels for generations.

A handful of forward-thinking hotel owners and operators are actively working to provide younger team members with a more effective and engaging personal communications toolbox. That kind of effective personal relationship development training is still all too rare, however.

What’s old is new again
How do we reverse this trend? As with so many things, it’s important to get back to basics. Remind your team about the importance of warmth and personal engagement. Recognize and reward employees who put those ideas into action. And don’t let opportunities for personal calls or face-to-face engagement go by the wayside.

Ultimately, it’s not about ideas, but about actions. Don’t just explain why a face-to-face conversation is important; provide specific training and techniques that ensure your employees integrate those concepts and practices into their everyday work.

Hotel management companies with personal training initiatives have already noted a significant and even dramatic uptick in 2019 and 2020 bookings. Hotel owners and operators also need to make sure they do their part by giving their teams the leeway they need to put those ideas into practice, including traveling to meet with important clients, agents and brokers, and taking the time to cultivate personal relationships that have a longer-term payoff.

Re-emphasizing personal engagement does not mean abandoning the extraordinary tools and technologies that have transformed the industry. But we can embrace the future without forgetting the lessons of the past. Hotel professionals who prioritize face time and personal engagement as a way to stay connected to guests, clients and professional partners will find themselves poised to prosper in an evolving and competitive hospitality landscape.

The warm smile, the firm handshake, and the friendly greeting have traditionally been critical arrows in the quiver of hotel professionals. Hotel owners and operators have long made it a point to address guests by name, and have trained their front desk and sales staff in the age-old art of face-to-face engagement with guests and professional partners.

Long before it was an app, facetime was a practice that was considered an essential part of running a successful hotel. That emphasis on facetime may be waning, however. New tools and technologies have led to new priorities and practices: many of which either ignore or place less of an emphasis on personal engagement. And with a new generation of young talent entering the hospitality workforce, that depersonalization trend is accelerating.

Hotel owners and operators are wrestling with the troubling irony that, at a time when technical marvels and new digital dimensions have opened up thrilling new frontiers, we are unwittingly closing doors that need to remain open if we want to get the most out of our personnel and our properties. In other words: even as we become more connected, we are drifting apart in fundamental ways. As a result, members of your sales team may not be making the most of their opportunities.

Even as hotel sales professionals are learning to do things at scale and to use digital/technological tools in exciting new ways, it's important not to lose sight of the fact that old fashioned facetime still goes a long way. Establishing, building and maintaining personal relationships-and using the power of facetime and personal engagement to make connections that translate to a very real and impactful bottom-line difference-is just as important as ever. Understanding why facetime is becoming a lost art (and appreciating why it can make such a significant difference for hotel professionals) is a critical first step in reestablishing and leveraging the power of personal engagement in your own property or properties.

The Tech Disconnect

Today, the hotel industry is benefitting from a transformative wave of powerful and exciting new digital technologies. Our collective ability to more efficiently and effectively market properties, strategically set rates, and book rooms has never been more sophisticated. But the innovation that flows from those new technologies-along with the proliferation of social media platforms and the ubiquity of personal mobile devices-is also having a dramatic impact on the way business conducted. It's fundamentally changing the way we communicate and connect with core audiences and professional partners (not to mention fellow employees-but that is perhaps a topic for another time).

A sizable and rapidly expanding percentage of people today "speak" to and with each other through digital media. Fewer conversations are held in person, and fewer connections are made face to face. Tools like texting, email and instant messaging have seen explosive growth in popularity and utility, and the majority of today's workforce communicates more frequently and enthusiastically through digital media and social platforms.

But for all these new technologies and digital platforms deliver in efficiency and immediacy, they leach away even more of the personal connection that has long been the lifeblood of the hotel industry. Even phone calls are becoming less popular. The unavoidably impersonal nature of these new channels presents a real challenge for hotel professionals looking to form and leverage the kind of strong and enduring connections and relationships that have proven to pay very real bottom-line dividends.

And for anyone tempted to dismiss the importance of facetime, consider this remarkable piece of information: at least one research study found that up to 93 percent of all communication is based on nonverbal body language. The implications are staggering. Do we really expect to get the most out of our sales team when they are so often working just with that remaining 7 percent?

The underlying problem facing sales professionals in the hotel business is not just that digital communication channels are on the rise, or even that opportunities for personal communication and engagement are becoming rarer. Those are both true, but this dynamic is especially tricky because the rise of impersonal communication options actually hides the true extent to which more personal communications are waning. It can feel like we are in touch with more consumers more often than at any other time in recent memory-but quantity is a poor substitute for quality.

A Demographic Gap

The trend toward minimizing facetime and personal engagement in favor of more impersonal digital communication channels is especially prominent among young people-specifically the much discussed and highly coveted Millennials, who represent a large, fast-growing and increasingly influential segment of both the workforce and the consumer base.

Familiarity with-and affinity for-technology among the younger generations is nothing new. What is fairly new is the extent to which those preferences have begun to impact entire industries. As Millennials and members of Generation Z begin to assume positions of seniority and influence in hospitality companies, that trend is only going to become more pronounced, and the current dynamic is only going to become more entrenched.

There is an opportunity to mold younger sales managers and other hotel professionals, and to give them the personal communications skillset many are lacking-but unfortunately many hospitality brands and businesses have been slow to recognize and respond to this issue. Many are not getting the training they need to conduct effective personal relationship development, and it is truly becoming a lost art.

The result is that today, on some important level, many hotel management companies have lost touch with the techniques that have been used to effectively sell hotels for generations. Finding ways to reestablish those personal skills, connect personally to establish strong and ultimately lucrative personal relationships with clients, and correct a growing industry imbalance presents a significant challenge.

 Back To The Future

The big question, of course, is what can be done about all of this? There is a troubling tendency in the industry right now to simply accept these trends. But hotel owners and operators would be doing themselves a disservice if they figuratively threw their hands in the air and failed to take proactive steps to address the issue.

Reemphasizing personal engagement begins with reminding ourselves and our employees to get back to the basics. That starts with the very essence of what hospitality embodies: a warm, welcoming and generously hospitable approach. It's all too easy to lose that warmth and personal touch when we allow the convenience of technology to supersede a personal call or visit.

But it's not just a philosophical shift-it has to be a practical one, as well. You can't just remind your team of the power of a face-to-face conversation. Dedicated sales training offering specific hand-to-hand and face-to-face personal sales techniques can be enormously beneficial-especially to younger employees who quite literally don't know how to use facetime to their advantage. Hotel management companies that have implemented these types of specific personal training initiatives already find themselves significantly ahead on group pace in 2019 and 2020-in some cases closing business that their sales managers had never even thought to go after in the past.

Above all, your sales team needs to recognize that complementing technology with engagement is absolutely essential. They need to be given abundant opportunities to make use of these personal communications strategies and face-to-face engagement and sales tactics they have learned: to not just speak with major client, agents and brokers personally, but also to get out and see them (at both sales meetings and through regular personal touch-points).

It's important to note that this does not mean you should abandon the tools and technologies that are giving hoteliers more insights and capabilities. Embrace them enthusiastically! They are an important part of any successful hotel's ability to conduct transactional business and make more informed and strategic decisions.

Moving Forward

Cultivating and maintaining invaluable personal relationships with agents and agencies, takes a great deal of hard work. It's quite literally an investment. But it's an investment with potentially handsome returns for those that commit to the process.

The convenience of digital communication and the power of e-commerce are alluring. But even the most powerful new tools and technologies can only ever be one part of a larger sales puzzle. If we write off those opportunities that can only be fully realized through facetime and personal engagement, we will be neglecting valuable and potentially very lucrative sources of business.

Communication preferences, platforms and practices might continue to evolve, but the power of personal connection will remain constant. While new generations of hotel professionals may not have the personal skillset or the appreciation for the importance of facetime, it is incumbent upon more experienced hotel professionals to recognize that and respond accordingly.

Making it a priority to stay connected to guests, clients and professional partners through face-to-face and voice-to-voice communications is about applying very old-school ideas of hospitality and engagement to an industry that is very much looking to the future. Hoteliers who can reconcile that irony, bridge the facetime gap, and effectively use personal engagement to build meaningful and profitable professional relationships will be positioned for success in a fast-changi 

In addition to recognizing the industry’s top achievers, the evening included exceptional food, networking opportunities and more than $4,000 in charitable donations were raised for St. Jude’s Children’s Research Hospital. In total, 15 awards were given out based on the nearly 6,000 votes received by Hotel Interactive®. 

“It was a historic evening. Please join me in congratulating all of the nominees and winners for their achievement of being recognized by their peers as the best of the best,” said Rich Viola, president and CEO of Hotel Interactive®.

David Kong of Best Western International was recognized as the Innovator of the Year for 2018. Other nominees included Roger Bloss, Alternative Hospitality; Geoff Ballotti, Wyndham Hotel Group; Masudur Khan, Seaside Lodging; Bill Linehan, Red Lion Hotels Corporation; and MarcAnthony Crimi, Walker Hotel Collection. 

Meanwhile, Concord Hospitality received the Owner/Developer of the Year award. Other finalists for the award included Pacifica Hotels; Shaner Hotel Group; Hotel Equities; AD1 Global; and Jamsan Hotel Management. 

Chesapeake Hospitality was awarded Third Party Operator of the Year. The other nominees included Charlestowne Hotels; Vesta Hospitality; Prism Hotels & Resorts; broughtonHotels; and Marshall Hotels & Resorts. 

DiLeonardo International was designated as Design Company of the Year. Other finalists featured BAMO, Inc.; Tipler Design Group; Pickard Design Studio; Baskervill; and Leo A. Daly. 

The winner of the Purchasing Company of the Year was Purchasing Management International. The other finalists for the award included Jaguar Hospitality; Carver & Associates; The Stroud Group; Hospitality Merchandising; and Partners Management Group. 

Elisa Whaler of Bray Whaler was given the award for Purchasing Company Executive of the Year. Other nominees included Gus Sarff, GS Associates; Vince Coppola, Hersha Purchasing & Design; Sean Hatch, Hatch Purchasing Corp.; PJ Jones, Project Dynamics; and Albert Solis, Hospitality Plus, Inc.

In the category of Design Executive of the Year, the nod went to Michele Espeland, Cuningham Group Architects. The finalists included Deborah Lloyd Forrest, Forrest Perkins; Lauren Chipman, Chipman Design & Architecture; Lauren Rottet, Rottet Studio; Rebecca Jones, RD Jones; and Andrew Alford, AJ Capitals/Graduate Hotels.

Rick Summa took the award for Brand Purchasing Executive of the Year. Other nominees included Paul McCardal, Hilton; Sebastien Brunel, Accor; Isabelle Larocque, Four Seasons; Ellen Villars, MGM Resorts Design & Development; and Anne Hanch, Hyatt. 

The winner in the Owner/Operator Purchasing Executive of the Year category was Laura Herzog, Wynn Design & Development. Also vying for the award were Erin Weiner, Noble House Hotels & Resorts; Marla Davis, Remington; Diana Caballero, Harrahs; Lisa Litke, Commonwealth Hotels; and Sharron Koch, Auro Hotels. 

Earning the top spot for Young Executive of the Year was Vicki Poulos, Moxy Hotels by Marriott. Fellow nominees included Michael Fuerstman, Pendry Hotels; Adam Marquis, Pacifica Hotels; Dev Patel, Kamla Hotels; Biran Patel, AAHOA; and Justin Jabara, Meyer Jabara. 

Janis Cannon of Choice Hotels received the most votes for Female Executive of the Year. Other nominees include Vera Manoukian, Hilton; Leslie Hale, RLJ Lodging Trust; Stephanie Atkisson, HP Hotels; Allison Handy, Prism Hotels; and Sheena Collins, Interstate Hotels & Resorts. 

The new Hotel Opening of the Year award was credited to the Hotel Indigo Tulsa Downtown. Other properties nominated were Even Hotel Miami – Airport; Jupiter Next (Portland); An Artful Hotel, Midtown New York; Springhill suites by Tampa North Land ‘O Lakes (FL); and Fairlane Hotel (Nashville).

The Eliza Jane in New Orleans, managed by HRI Properties, won the award The Most Unique Hotel Conversion. Other projects up for the award included the Embassy Suites by Hilton Toronto Airport; Hotel Indigo Madison (WI); NYLO Hotels; The Greentree Inn & Suites, Pinetree, AZ; and Beaver Creek Lodge in Colorado. 

The winner of the Brand Intro of the Year award was Motto by Hilton. Other nominees include Aiden by Best Western; Clarion Pointe by Choice Hotels; Jupiter Hotels; Compass Hotels by Margaritaville Resorts; and Caesars Entertainment. 

Finally, Caesars Entertainment Corp. won the award for Excellence in Sustainability. Other finalists were Dream Hotel Group; Benchmark Hospitality; Naples Hotel Group; Hersha Hotels & Resorts; and Aqua-Aston Hospitality, Inc. 

Culture is a term that is used so often these days that it’s in danger of becoming a corporate buzzword, joining a long list of words and ideas that have become almost meaningless through repetition.

If that were to happen, it would not only be a shame, it would be a mistake.

Despite the fact that seemingly everyone in the hotel industry boasts about their culture, the reality is that a strong culture remains a difference-maker. True, meaningful commitment to building, nurturing and maintaining that kind of culture is rare. It’s even rarer when a hotel management company can continue to live and breathe its core values as it grows larger—maintaining the same foundational principles and practices that defined its work and its people from the outset.

Appreciating the urgency of that mission—and understanding the specific steps that decision- makers need to take to make it happen—is arguably more important now than at any time in the last decade. With softening numbers on the horizon, and the inevitability of what seems likely to be at least a slowdown or a modest downturn in the not-too-distant future, hotel professionals are asking themselves how they can keep making money when and if things start to sputter. With record unemployment and wage growth, an owner’s biggest defense against profit erosion is maintaining your personnel: keeping them engaged, well-trained, happy and motivated. A well-trained employee is significantly more productive than a new hire. And turnover is a killer.

The bottom line is that if culture hasn’t been your primary focus, it needs to be. If you treat it more like a buzzword than a priority, that needs to change—right now. Building a strong culture is inherently a process, not an event. It can’t be rushed, and it’s not a switch that can be flipped.

Of course, the question of how to strengthen, maintain and reinforce your company culture is where things get tricky.

People
Start by highlighting and rewarding positive examples of employees who embrace and exhibit those ideals and core values. For us, that meant creating a new role of a full-time cultural ambassador who visits every property in our portfolio to present a powerful workshop and training session. That work isn’t directly about Chesapeake, it’s about our people: helping them identify what matters to them at home and at work and how they can integrate those priorities every day.

Practice
Your people aren’t magically going to instill and embody your core values on their own. You have to devote the resources to do that—actually implementing and integrating cultural principles as part of your core functions on a regular basis. Every staff meeting shouldn’t include just metrics, but also discussion about one or more of your core values. Work with the human resources department on training, retention and employee satisfaction best practices. Culture literally has to be part of everything you do.

Precision
It’s a common mistake to treat culture like a vague or abstract ideal. Be specific. These are the shared attitudes, values, goals and practices that define you—make them clear to your team. We regularly find ways to work our core principles: honesty, the quality of being truthful and fair; integrity, the quality of having strong moral principles, and doing what is right even when it is difficult; and humility, the quality or state of not thinking you are better than others and of being humble. These are applied in our day-to-day operations.

Perspective
Invariably, whenever we see something going wrong, we immediately recognize that it’s the result of actions that were not in line with our core values. From the smallest moments to the largest decisions (hiring, firing, training, cleaning, maintenance, etc.), you need to filter every decision and every strategic move through the filter of your core values. It takes a conscious effort to do that.

Proof
If you do the cultural work on the front end, your day-to-day management demands tend to get easier. Everything works and everything goes smoother when everyone is pulling in the same direction. On the flip side, if you find yourself constantly banging your head against the wall and are having trouble figuring out where or why things are going wrong, it’s highly likely that a cultural deficit might be the “X factor.” Being a third-party manager and emphasizing culture can be a real challenge. But that only makes it more important because where our culture is thriving, the bottom line reflects that. Extraordinary results can seem almost effortless.

Palpable
There needs to be interconnectedness with our people, guests and clients on a human level more so than on a business level. The key is recognizing that positive outcomes have to be natural returns derived from genuine human connection. You can’t do this with dollar signs in your eyes. You have to have a genuine desire to build connections and relationships and trust that the results will come. You need your people connected to a bigger cause—to believe in what you are doing—and trust that good things will come from that.

And you can’t fake it. If your efforts aren’t genuine, they won’t work. There’s a difference between talking the talk and walking the walk. Your employees can tell. Your partners can tell. Your guests can tell. Everyone talks about their culture. If you want to stand out from the crowd, you have to live your culture.

Chris Green is the COO of Chesapeake Hospitality. He brings more than a quarter century of successful hospitality operations experience to Chesapeake’s corporate team, including nearly a decade in the field at various Chesapeake-managed properties. For more information, visit https://www.chesapeakehospitality.com/.

The opinions expressed in this column do not necessarily reflect the opinions of Hotel News Now or its parent company, STR and its affiliated companies. Columnists published on this site are given the freedom to express views that may be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to comment or contact an editor with any questions or concerns.

REPORT FROM THE U.S.—As revenue managers look ahead to 2019, steady but slowing performance growth lingers on the horizon, which emphasizes the need for both smart and creative decision-making to continue to generate revenue.

While their hotel industry outlooks for the coming year were all positive, three revenue-management executives shared their biggest priorities for 2019, including plans to generate additional revenue and work within tighter budgets.

Optimistic about 2019
STR, parent company of Hotel News Now, projects full-year U.S. revenue per available room to increase 2.4%, mostly fueled by average-daily-rate growth of 2.3% with occupancy growth mostly flat (0.1%).

Cassie Bond, VP of revenue management at Chesapeake Hospitality, said as part of an email interview that her company is bullish on 2019, but it’s better to be proactive and “stay one step ahead at all times.”

“Overall, we are expecting RevPAR growth in most of our markets next year, and it’s going to be through ADR,” Bond said. “As Chesapeake budgets are designed by day and market segment, this provides the framework for our revenue-management strategies. We have to be thoughtful about our mix of business in order to achieve our goals.

“This means consistently analyzing booking windows, length of stay, day-of-week patterns and overall spend by rate plan for each segment. It will also mean being able to adapt and adjust strategies when necessary if market dynamics change.”

Vickie Callahan, VP of revenue management at Atrium Hospitality, said she, too, expects ADR growth to be the foundation of a healthy year with occupancy “at peak levels.”

“The new supply in certain markets might temporarily threaten occupancy of existing hotels, but demand is strong, and we expect new supply to be a short-term challenge,” Callahan said via email.

Callahan added her company intends to fine-tune the revenue strategy that was so successful in 2018.

“The effective strategies from 2018 will remain, and the team will continue to find new and creative ways of managing high-demand days, upselling premium room types and being flexible during low-demand periods,” she said.

Terry Daum, VP of revenue optimization for Vision Hospitality Group, said while 2019 should be “another record year,” there’s always room for improvement.

“With the growth anticipating to slow, we will continue to look at optimizing our mix and supporting our sales teams’ efforts to layer in additional business,” Daum said via an email interview.

Vision Hospitality plans to open six new properties in 2019, Daum added.

Creating a culture and developing team members ranks high on Bond’s 2019 priority list.

“Our biggest priority for 2019 is fostering our revenue-management culture throughout all of our hotels and developing our team members,” Bond said. “Over the years, Chesapeake has created a strong culture and revenue-management team. We want to maintain this high level and be able to build on it next year. This will be critical in a tight labor market and will give us the edge over our competitors.”

Distribution and automation
As distribution channels continue to emerge and automation takes a bigger hold in the revenue-management discipline, sources said they recognize how things are changing and have strategies in place to come out ahead. That’s even more critical as profit margins are expected to tighten in the year ahead.

“Tighter profit margins place an even higher importance on shrinking distribution costs,” Bond said. “In order to drive the most profitable business into the hotel, revenue managers must truly understand the costs (and hidden fees) associated with each channel/booking. Then a thoughtful, actionable strategy is determined by channel and becomes the basis of the budget and marketing plan for the hotel. All disciplines within the hotel have to understand this revenue strategy and work in tandem to make it achievable.”

Callahan said Atrium has optimized its approach whether targeting group or transient customers.

“For years, we have challenged the company’s revenue-management leaders to review group and larger pieces of transient business down to the profit line,” she said. “This has changed their way of thinking about business and challenges the team to make better decisions. The team stays up to date on the cost of sale by channel (or) source.”

Revenue-management tools have become more intuitive, Daum said, which gives revenue managers freedom to think long term.

“The revenue-management systems our brand partners have rolled out over the last seven to 10 years have helped revenue managers spend less time on keystroking and become more proactive and strategic,” Daum said. “… We no longer just monitor our rates versus our competitors, but also our own rates and rate products across our channels to maintain parity.”

Chesapeake’s Bond described the data as more “actionable,” but stressed automation isn’t taking over the discipline anytime soon.

“Almost all brands have implemented a type of automated revenue-management system,” she said. “However you can’t let this system blindly lead you into battle. Instead, Chesapeake revenue managers become experts with these systems and manage them daily to ensure that our goals, as well as our owner expectations, are always at the forefront of every strategy decision.”

Generating additional revenue
Finding new sources of revenue to supplement rooms revenue requires some creative and collaborative thinking, Callahan said.

“With more than 2.3 million square feet of function space, Atrium Hospitality’s revenue-management leaders spend just as much time on event-space maximization as they do on room revenue,” she said. “Decisions on what business to take starts with the total revenue and total profit contribution before considering the impact to the STAR report or budgeted ADR goals.

“Additionally, our leaders are encouraged to be creative, looking for the aggregation of marginal improvements. We study market details of incidental revenues and ensure we are actively leveraging these revenue streams.”

Daum said Vision has similar goals to generate additional spend by guests.

“Going forward, it will be interesting to see how revenue management continues to develop beyond optimizing top-line room revenues into profitability metrics—(gross operating profit per available room)—and optimizing the guest mix to drive total revenues from meeting space, catering and ancillary outlet revenues,” Daum said. “The collection, consolidation and sharing of data and performance metrics is also key.”

Chesapeake’s revenue-management team is equally invested in driving additional food-and-beverage revenue, Bond said.

“(We) are focused on understanding our target guests and their spend at our hotels,” Bond said. “This includes catering and food and beverage by outlet. We work very closely with sales to ensure we are going after the right pieces of business that will not only maximize top-line revenues but also drive our GOP projections.”

These days, that necessarily means connecting with and appealing to millennials. Understanding the preferences and priorities of that much-discussed and increasingly influential demographic is viewed by many as a prerequisite for anyone who wants to thrive in an increasingly competitive market for talented professionals.

Despite years of talking about it, however, the reality is that many in the hotel business are still trying to figure out how best to work with millennials. This is a group of people who grew up in a time of relative prosperity, and they have high expectations about workplace environment and work-life balance. Satisfying those expectations sometimes can be challenging. This is, after all, a business where there are some logistical challenges that cannot be avoided. Hotel operations have lots of technically complex tasks and important jobs that can place a significant demand on your schedule and workplace hours. While this is the nature of a 24/7/365 business, that can be a tough sell for millennials.

Complicating the issue is the reality that we, as an industry, haven’t done a really great job of appealing to millennials. There are some extraordinarily rewarding, inspiring and downright fun aspects to hotel management, and it’s incumbent upon existing hotel professionals to do a better job of conveying that excitement and dynamism to potential millennial job candidates.

Here’s the good news, however: The post-millennial generation, Generation Z (“Gen Z”) is on the way. And there’s a lot to like about them. This is a group that has largely flown under the radar, overshadowed by their headline-grabbing millennial predecessors. It might surprise many to find out that Gen Z—defined as those born between the mid-1990s and the mid-2000s—is actually substantially larger than the millennial generation. Despite the fact that not all Gen Zers are old enough to enter the workforce, the group is already making a dramatic economic impact.

A new study recently released by The Center for Generational Kinetics, “The State of Gen Z: Meet the Throwback Generation,” reveals some fascinating and important insights about a demographic that is surprisingly different from millennials. The study describes Gen Z as a “large, diverse, and digitally entrenched generation” poised to “take the trend-driving mantle from millennials” and replace them as the “focal point of future workforce change.” With that in mind, the hospitality industry needs to be paying very close attention to ensure that they understand this generation and what makes them tick.

Throwback perspective
One of the findings from the study is that Gen Z is, in many ways, looking like it might be a “throwback” generation, displaying the “attitudes, beliefs, and behaviors that combine their tech-saturated world with elements of generations past.” This is a generation that has been through some tough economic times. They’ve seen people—sometimes members of their own families—downsized, they have a healthy fear of unemployment and financial stresses, and, consequently, a correspondingly strong work ethic.

Early earners
Amazingly, about half of the members of Gen Z are already working in one form or another, and that 77% “earns their own spending money through freelance work, a part-time job, or earned allowance.” As the study points out, this is a similar percentage to surveyed millennials who are fully 10 years older. This work experience cannot help but give members of Gen Z a leg up when they move into more full-time positions in the workforce in a few years.

Mature priorities
Gen Z survey respondents listed their top two skills for workplace success as communication and problem-solving. This might not come as a complete surprise, given the extent to which employers have suggested that these are areas where millennials could be stronger. Interestingly, however, members of Gen Z reported similar priorities when it comes to what they most want out of a job—specifically a fun work environment and a flexible work schedule. Given the many other differences in perspectives and priorities between millennials and Gen Z, the similarity in workplace perk preferences is noteworthy.

Financially savvy
Shockingly, many members of Gen Z are apparently not only already thinking about retirement, but preparing for it. According to the study, 12% of Gen Z members are already saving for retirement. This might be because “unlike previous generations of parents who did not talk about money or financial topics with their kids, Gen Z’s parents have taken a very different approach.” The study found that “56% of Gen Z have discussed saving money with their parents in the past six months, and 53% have discussed earning money with their parents.”

Gen Z might just now be showing up on our radar, but as our industry’s experiences with millennials show, hospitality professionals need to be proactive if we want to create the “commitment to the mission” that characterizes the best teams and individual employees. To appeal to this demographic, companies must affirm a strong corporate culture, remain visible and active on social media and, of course, stay flexible—which means embracing generational differences. They are our employees of the not-too-distant future, and the time to engage them is now.

While the current economic cycle has presented real opportunity for the hotel industry, it has also masked the reality that there are a number of underperforming properties out there. If the trend line is going up, there is an (understandable) tendency to think everything is going great.

But the reality is, in hotel management, there is always room for improvement. Ironically, owners who are satisfied with their hotel’s results are at greatest risk: they might not know what they are missing.

As a company, we fundamentally believe that problems begin when you accept the status quo with regards to performance potential.

As good as it gets?
All hotel investors are programmed to look for opportunity. But a strong market can complicate that search. While a rising tide might lift all boats, it can also make it harder to spot that slow leak below the waterline.

Almost every hotel has its share of challenges—they often include dated exteriors, an uninspired staff, unfocused sales efforts or perhaps a mediocre online reputation. Sometimes it takes new leadership to overcome those challenges, to see things with a fresh eye and to aggressively seek out new opportunities to manage operational costs and improve hotel revenues. Once previous operating and sales assumptions are cast aside, a new strategy can be built from the ground up, reorganizing and optimizing departments when necessary. The results can be immediate and unequivocal, with potentially eye-popping increases in revenue, GOP and revenue per available room index.

Leadership and culture
Never underestimate the value of leadership and company culture from your hotel management team. Having the right property leadership is critical to executing an efficient takeover strategy. Nothing matters quite so much as culture, though—it goes deeper than camaraderie.

Culture isn’t abstract, it’s about efficiency, accountability, performance, setting expectations and achieving results—and that all starts with recognizing you can do better. In my experience, building a great culture is impossible if that culture isn’t focused on success, intensity and achieving results.

Plan of attack
Our takeover procedures begin with a comprehensive “health and wellness” checkup: a complete review of existing structures and operations that form the basis of a new action plan. Essentially, the goal is to rebuild the property from the ground up. Everything from culture and costs to operational and financial attention to detail should be up for review and revising.

Once you ask how you would build this property and product type in this market, big changes—and big results—become possible. We’ve discovered sales teams that weren’t sufficiently engaged with or pursuing markets they should have been; instead they were defaulting to a standard segmentation approach versus a market-specific focus for their hotel. We’ve shifted revenue management strategies. We’ve reorganized sales offices, changed marketing strategies and restructured operations entirely, focusing on efficiency, tracking and sharing metrics. Above all, we work to instill a culture of performance.

The big ones
Cultural shifts. Leadership changes. Staffing, sales and revenue management. E-commerce and digital marketing. Operational effectiveness and emphasis on service metrics. It’s all important, but there are certain key areas that are deserving of extra attention.

Metrics and motivation
Reorient your sales and operations teams to metrics that matter. Monitor those metrics and be transparent. In the push for more productivity and efficiency, incentivize and reward your team. If you are going to ask housekeeping personnel to clean more rooms per day, consider implementing new incentives to make it a positive change versus a new obligation.

Costs and consequences
New strategies and efficiencies are not necessarily about cutting costs, but investing resources that provide a better return on investment. If you make smart investments in your people, your sales efforts, and other aspects of your operation, returns will follow. Chesapeake isn’t afraid to spend more money than previous management teams in sales and marketing, but we can afford to do so because we reliably create a significant sales spike, making a modest uptick in spending inconsequential.

Granularity matters
The best hotel management professionals are extraordinarily granular in how they approach their craft. Our revenue management team analyzes general data on incoming reservations, but we also go through and verify every single SRP to make sure they are properly mapped to the right booking system. Is your hotel sufficiently visible online? Are you missing out on potentially lucrative government business? We have come into properties where one insight alone generated an exponential monthly boost in revenue from multiple sources.

In case you think our hotels might be immune (they are not), we implemented a bi-annual review takeover audit to keep each property focused on improvement. Fall victim to complacency—no way!

Remember, the moment when you think you can’t do any better is when it’s more important than ever to challenge your ingrained assumptions. If you have the courage to challenge yourself and set your expectations higher, costly mistakes can be avoided and valuable opportunities can be realized.

Chris Green is the COO of Chesapeake Hospitality. He brings more than a quarter century of successful hospitality operations experience to Chesapeake’s corporate team, including nearly a decade in the field at various Chesapeake-managed properties. For more information, visit https://www.chesapeakehospitality.com/.

The opinions expressed in this column do not necessarily reflect the opinions of Hotel News Now or its parent company, STR and its affiliated companies. Columnists published on this site are given the freedom to express views that may be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to comment or contact an editor with any questions or concerns.

Let’s ask two people who know: HSMAI 2018 Corporate Revenue Management Professional of the Year Cassandra Bond, CRME, CHRM, regional vice president of revenue management for Chesapeake Hospitality, and HSMAI 2018 Single/Multi-Unit Revenue Management Professional of the Year Derek Brewster, director of revenue management at Lotte New York Palace — both of whom will be recognized during HSMAI’s Revenue Optimization Conference (ROC) in Houston on June 19–20.

What was your first job in the hospitality industry?

Cassandra Bond: My first job in hospitality was actually in food and beverage as a hostess at Mama Della’s Ristorante in the Portofino Bay Hotel in Orlando. My first job on the hotel side was a front-desk agent at the Wyndham Westshore — now The Westshore Grand — in Tampa.

Derek Brewster: I lied about my experience and pushed my way into a fantastic bartender job at a nightclub in Perth, while I was backpacking through Australia.

What do you most like about working in revenue management?

CB: Revenue management is an area where you have both structure and discipline but also complete creativity. You have direct guidelines and goals, but your path to achieve them is completely up to you. At Chesapeake, we call this “freedom within a framework.” This freedom allows us to stay motivated while consistently looking for improvement. It’s a results-driven field that remains challenging.

DB: I think the most exciting part of RM is that it is always changing and innovating — the systems, technology, digital marketing, data science, etc. — but the best part of the job is that I get to work directly with so many departments within the hotel, and the impact the RM team has on the overall hotel performance is so far-reaching.

How can revenue-management professionals best collaborate with their colleagues in sales and marketing?

CB: It is crucial that revenue management and sales and marketing work in tandem in order for a hotel to be successful. This comes with trust, respect, and open communication between departments. Creating an environment where healthy discussion over revenue strategies is encouraged can help foster collaboration between these departments.

DB: It’s up to RM to navigate the market, oversee all pricing strategies, and ensure the best possible mix of business. In my opinion, the only way to be successful at all of that is to truly partner with sales and marketing, because they are the teams executing the strategies RM has established. We have weekly strategy meetings with each team — leisure, corporate, group, and marketing — to ensure we are all on track to achieve our goals, and if any segment is behind, we’re able to pivot quickly enough to mitigate any shortfalls, and everyone is engaged with the strategies that way.

What is a trend in hospitality that you have your eye on?

CB: Digital marketing and the ongoing impact on revenue management — revenue managers need to be savvy here and to understand how to create real ROI. Also, the evolving landscape of distribution channels — staying on top of new channels, costs, fees and loyalty programs.

DB: Everything involving ways that advances in technology and digital marketing can help hotels know their guests better and be able to deliver highly personalized service as well as tailored/bespoke offers to keep bringing them back.

Where would you like your career to take you?

CB: I am extremely fortunate to work for a company that understands the value and importance of revenue management. The sky is really the limit here, and I can guarantee the road ahead will be exciting and challenging.

DB: I went to hotel school because I love to travel, and I’ve been fortunate enough in my career to live in some fantastic cities in the U.S. The ultimate goal is to experience many more amazing cities while continuing to develop RM talent and helping direct teams to successful results.

The Greenbelt, MD-based company last month promoted Jane McCaul to the position of director of corporate culture & communication. In her new role, McCaul has been charged with driving key internal communications related initiatives, including the company’s charitable efforts, as well as creating and executing programs focused on the culture.

For hotel management professionals, the ability to see what’s next—both for the broader marketplace and for the industry—is a big part of the job. The beginning of the year is the perfect time to do just that: to look ahead, to identify emerging trends and new developments and adjust your strategic planning accordingly.

But forecasting is a tricky business, and sometimes it can be a little too easy to let optimism and entrepreneurial vigor influence your predictions. As a result, it might be helpful to reframe the question. Instead of asking what’s next, try thinking about what’s not next.

Because sometimes knowing what’s not likely to happen is just as valuable and informative as knowing what is likely to happen.

With that in mind, here are a few things that we likely won’t see in 2018:

Plenty of qualified, affordable labor
Considering how much this industry relies on motivated, experienced talent, it’s frustrating to consider the fact that staffing will continue to be a sore point. Building a strong team isn’t likely to get any easier in the foreseeable future, and recruiting and retention challenges will continue to be an issue in 2018.

With low unemployment, rising salary demands and the evolving preferences of an influential millennial generation, the hiring landscape looks very different today than it did a few short years ago.

Hotel owners and operators have had some success bringing in recruiting and retention specialists—professionals with demonstrated recruiting expertise and the ability to deploy the kind of priorities, programs and practices that connect with both prospective and existing employees.

But consistently attracting and retaining top talent in this environment also requires strong messaging and leadership, a robust presence on social media platforms and other places where you can boost visibility to prospective candidates, and proven interviewing, onboarding and employee retention programs and processes in place. This is something we’ve paid great attention to, and it works.

Soaring RevPARs
While 2017 was yet another strong year for the hotel industry—and revenue per available room has increased every year since 2009—the pace of growth has slowed in the last two years. Year-over-year change in 2017 was the lowest it’s been in a long time, and—in conjunction with staffing challenges—the slower pace of growth is beginning to put some pressure on the bottom line.

Official 2018 RevPAR forecasts are between 2% and 3%, and the predicted occupancy growth in 2018 would make it nine consecutive years of rising occupancy, which hasn’t happened since the 1990s. Still, we are not likely to see the kind of RevPAR spikes that characterized the post-recessionary boom in the wake of the late 2000s economic slowdown. If anything, predictions for 2018 may even be somewhat optimistic, and hotel owners and operators would be wise to plan accordingly.

Surging profits
Given the marketplace dynamics described above, it seems likely that there will be some inherent limitations to profit growth in 2018. While we may see an uptick, it almost certainly will not be at the same rate as we have seen in recent years.

There is more uncertainty here than usual, with the yet-to-be-answered questions about how the recent tax changes will play out, and the troubling news about the decrease in international travelers (and tourist dollars) in 2017. But it’s safe to say that profit growth will not be setting any records over the next six to 12 months.

Fewer brands 
A crowded hotel marketplace isn’t getting less crowded anytime soon. The success of new brands—particularly specialized, boutique and niche concepts—means that we will continue to see more brands (which means more choices and also more market saturation).

Select-service is a particularly active segment, with hoteliers getting more creative about finding ways to give consumers affordable options while still providing them with some of the extra features and amenities they are looking for.

The proliferation of new brands is a healthy part of an evolving industry in the midst of an extended period of prosperity, but it will be interesting to see which concepts thrive and survive when the next recessionary cycle emerges. Speaking of which …

The beginning of the next downturn
Industry analysts and observers have been warning about the end of the current growth cycle and a subsequent downturn for several years now. That obviously has not yet happened, but the slowdown in growth in 2017, some early warning signs of oversupply and some potentially concerning hints/macroeconomic indicators have renewed talk that the expected downturn may be happening sooner rather than later.

I don’t buy it.

The hotel market—like any other industry—will always be susceptible to a global economic crisis or an international event/marketplace disruption. But there is no real reason to believe that 2018 will be the year that things start to go downhill. While there are legitimate questions about how much more industry expansion is realistic, the next 12 months seem likely to continue a positive, if slowing, arc of growth.

As hotel owners and operators plan for the next six to 12 months (and beyond), having a sense of what isn’t on tap and what they can’t expect to see going forward will remain an important part of the predictive toolkit.

As summarized in Deloitte’s 2017 Travel and Hospitality Industry Outlook, business travel broke records at $1.2 trillion in 2015, and leisure travel shows steady growth outpacing the US’ GDP. The fundamentals behind this growth are strong - disposable income was up 3.4 percent at the end of 2016, as the job market continues to strengthen.

 However, a growing industry does not mean growing business for each hotel operator. In this period of unprecedented opportunity, competition is more intense than ever. Here are five core strategies to stay ahead during this historic race to the top:  

 Embrace technology

Ten years ago, how absurd would it have seemed to check into your flight on your phone and scan your screen all the way to your seat? Ten years from now, a room key will feel as antiquated as the paper boarding pass. Picking up the phone to call room service as opposed to clicking through your hotel app will be one conversation too many; and what good will the hotel’s entertainment system be when everyone has Netflix or Amazon Prime? What are we offering that they can’t already get?

 While we don’t need to solve all these challenges today, we must commit to a future strategy that embraces technology. Meet the vendors at the leading edge, build relationships and understand how technologies are developing. Determine how to incrementally enhance your tech offering over the next five to ten years, and start today.

Think globally

The booming global middle class will continue to be a seismic factor impacting our industry. According to Brookings, this group hit a whopping 3.2 billion in in 2016, and is expected to grow 120 million per year for the next five years. 88% of the next billion entrants into the middle class will be from Asia.

 I don’t care if you're the quaintest hotel in the most authentic Southern town in America, the emergent global middle class affects you. Begin to think about what kind of travelers are coming to your region from areas with rapidly growing spending power, and how you can more effectively target those consumers throughout their decision-making process.

 “Coming to America? Well, you need to see the birthplace of Coke amidst the classic charm of Atlanta, and the only place to stay is...”

 What starts as trickle could explode to 50% of your business over the next ten years. To stay ahead of the curve, start today.

Become the culture, deliver experience

Beyond restaurants, bars and yoga, hotels need to think about how they play a deeper role in a guest’s travel experience. Ultimately, capturing more attention during a guest’s time in a city necessitates becoming a deeper part of that locale’s culture. 

 While not every property gets to be a Hawaiian resort hosting traditional Hula, a hotel in Seattle could have its own roaster and master barista, a property in Brooklyn could have onsite glass blowing, while a roadhouse in Tennessee could host blues in a hip downstairs where they still their own moonshine (legally, of course).

 For less than the investment needed to create a competitive restaurant, properties can create remarkable experiences that truly contribute to a locale - capturing more overall guest attention and, ultimately, revenue.

Double down on fundamentals

Above all else, hospitality is a ground game -  the individuals shaping experience at each hotel, and the team cultures they create, will continue to define success well into the future.

 A warm welcome at the valet, and a front desk team that remembers the last time you were here. That perfectly made room, and a concierge that knows the best restaurants for every occasion. Those fundamentals will always be the cornerstone of any hotel stay. With all the attention on apps and new markets, we must double down on recruiting and cultivating the best talent.

Grow

If you have money to invest, now is the time. This remarkable period of growth is no bubble. While no one can know the future, what we’re seeing is underpinned by national and global economic trends that show no signs of slowing down. Leverage this opportunity to underpin the strength of your operations and invest in growth. One thing’s for sure, the competition is. 

Having grown up in the 12-room Royal Pine Motel in College Park, Md., a property purchased by their parents, Ed and Jeanette, in November 1957, Kim and Chris have an intimate attachment to the hotel business and they still see themselves as hosts, no matter where they are.

Kim Sims is fond of saying that guests were visitors to their home back in those days, and he’s speaking literally. When guests would ring a buzzer at the front desk, it would make a sound in the family’s living quarters, and the hotel’s office was an extension of the rooms where he and the rest of his family lived. In that environment, Kim and Chris were able to take on every job associated with running a hotel, from cutting grass and stripping beds to setting rates. This has informed all of their later decisions, particularly when it comes to their relationships with employees.

“Personally, I’m driven to be the best, but my definition is a little different,” Kim said. “I want to be the best manager and the best employer that our team members can work for.”

Kim would gravitate toward the operations side of the business, leading him to his current position as principal and president of Chesapeake Hospitality.

By his own admission, Chris was more interested in sales and marketing, becoming principal and EVP, while their brother Andrew Sims was most attracted to the financial and investment side of hospitality. Today, Andrew is CEO of Sotherly Hotels.

Another Take

One of the most important lessons the brothers picked up at the Royal Pine Motel was to value different experiences and points of view. Socrates once said: “I know that I know nothing.” Kim and Chris would like to think they know a thing or two about hospitality, but their lifelong experience in the field has shown them that their dedication to Chesapeake and Chesapeake alone has strengths and drawbacks, which is why they are always looking for outside talent.  

“One negative to growing up and being with the same company for 35 years is that my experiences are all tied to this one particular company,” Chris said. “Because we know this, we’ve never been afraid to hire people with more experience than we have. Then we let them loose to go perform.”

Recruiting is always on the brothers’ minds because they know that they won’t be able to lead the company forever. Chris, in particular, stressed the need to cultivate the next generation of managers, and the difficulties inherent in the process due to low unemployment and a diminished interest in hospitality from young people. This is a long-term concern, however. Kim said the industry’s biggest problem right now is flattening revenue per available room and increasing costs associated with monitoring revenue.

“When business looks good, everybody looks good,” Kim said. “We do well historically in a down cycle, when people don’t know how to manage well. During those times, we look for opportunities where we can go in and improve operations or revenue management. A lot of companies look good now, but in a downturn we really shine.”

The Next Movement

Kim said solid hospitality fundamentals are going to be more important in the future for management companies such as Chesapeake as the lines between brands continue to blur and consumer confusion increases. This, when coupled with the rate of change in operations and technology, is going to give some operators headaches in the years to come.

“Back when I was working the front desk at the Royal Pine in the 1970s and ’80s, we would set our rates once per year,” Kim said. “Now we change them three to five times a day! That is a huge change.”

In 2010, Chesapeake went through a rebranding process to increase its third-party management contracts, something Kim said presented the biggest challenge in the company’s history. Getting Chesapeake’s name out in the industry and finding other businesses aligned with their ideals proved difficult at first, but led to an eventual payoff. The company’s goals are distinguished by three numbers: 5/50/500.

“In five years, we want to have 50 hotels in our portfolio earning $500 million,” Kim said. “We don’t want to be the biggest company out there, just the best.”

For Chris, this is a difficult goal, but not an unattainable one.

“It has been 60 years since our parents started the business, and we’ve had considerable growth since then, but never overly dramatic,” he said. “Our parents put at risk everything they had to help us grow after we left college. I see it as paying it back to them through reinvestment in their ideas.”

REPORT FROM THE U.S.—Hoteliers who’ve recently downsized or altogether eliminated roomservice at their properties are seeing considerable labor cost savings from the shift, as well as robust profits when implementing grab-and-go dining options. Experts said all but the most luxurious hotels will likely make the move in the near future.

Roomservice revenue is on the decline—down 3.6% over a trailing 12 month period, according to June 2017 data from Hotel News Now’s parent company STR—while other segments of hotel F&B operations are experiencing modest growth—up 1.5% overall for the same period. Sources explained that in addition to less roomservice being offered, the decline reflects a broader trend of guests simply looking elsewhere, often for quicker, cheaper and more unique options.

“People are looking for something a little faster,” said Joseph Rael, director of financial performance, consulting & analytics at STR. “If you order roomservice, you’re waiting 30 to 40 minutes for your meal, whereas with grab-and-go, you can pick up on your way out and you’re good to go.”

Sensing the writing on the wall, a number of full-service hotels in recent years have cut back or eliminated roomservice completely. This includes the 2,000-room New York Hilton Midtown, which switched from roomservice to grab-and-go in 2013. Others seeking to still cover all the bases have modified and/or streamlined roomservice, offering alternatives like pared-down menus and takeout-style delivery in paper bags, rather than serving in-room meals with fine china and cloth napkins. Even in its infancy, the grab-and-go trend is proving especially profitable, both in cost savings and increased revenues.

“We really started three or four years ago putting a lot of effort into our grab-and-go spaces. If we have a coffee offering nearby, we combine those to make sure the spaces flow together, and we’ve seen huge returns,” said Chris Green, principal and COO of Chesapeake Hospitality. “I’ve got a full-service, 275-room hotel where over the past four years revenues have gone from 50/50 (between roomservice and grab-and-go sales), to now, where roomservice is about 10% of our grab-and-go sales. Our grab-and-go sales have quadrupled over the past four years.”

Bagged and delivered grab-and-go offerings such as Hampton’s On The Run Breakfast Bags are another growing F&B option. (Photo: Hilton)

It’s not just the added sales from grab-and-go that are boosting F&B profits; the reduction in labor resulting from a partial or complete roomservice reduction can have a huge impact as well. That’s particularly welcome among hoteliers, since limiting F&B labor costs is becoming increasingly difficult as minimum wages rise, especially in union hotels, where job-sharing is often banned. Non-union hotels might have some success cutting costs by doing things like having their call center take roomservice calls and utilizing restaurant staff for deliveries, but in the end, it may still be better to just let go.

“The best thing to do is eliminate roomservice altogether,” said Gary Isenberg, president of LWHA Asset & Property Management Services. “We’ll see that more and more with the full-service brands, especially in upscale and upper upscale. I think luxury will continue to have roomservice, and that’s where it belongs. Grab-and-go is much more profitable than roomservice, depending on how you structure your grab-and-go.”

Understandably, some operators are hesitant to completely cut the roomservice cord and are hedging their bets with both in-room and grab-and-go choices. But even in hotels that are still offering some level of roomservice, putting greater emphasis on alternatives like grab-and-go is having a positive effect on staffing, provided F&B operations are tailored for maximum effectiveness.

Grab-and-go “made us much more efficient on the labor side,” Green said. “We haven’t eliminated roomservice, because we still believe it’s an important touchpoint. What we’ve done, though, is kind of combine the menus across the grab-and-go and roomservice offerings, so there’s not duplication of efforts. If we’re producing items that go in the grab-and-go, those are the items you can generally get in the roomservice offering. You eliminate the need for extra prep, extra product and extra storage.”

Sources said there still is a time and place for roomservice, particularly during breakfast hours, when many guests continue to find convenience through in-room dining, as well as among guests on their first night at the property, especially after just flying into town. So for upper-upscale and luxury hotels that still want cater to this demand, smart menu engineering and labor streamlining could provide the answer rather than cutting roomservice completely.

“Menu engineering’s important. You can have 10 items on your menu, but only use three products,” Isenberg said. “Look at Chipotle: They have three items, but because of the different ingredients, it makes thousands of different choices. In your hotel, you can offer a fresh-carved turkey sandwich. You can also do a Cobb salad with turkey, and you can also do an open-faced sandwich. You can take one product and cover many different items. You only need to have two or three of those products, and it still looks like a robust menu.”

Both Green and Isenberg said that it’s likely the grab-and-go/minimized roomservice trend will morph into a hybrid concept, where fresh menu options sold in the hotel market pantry will be available for delivery to guestrooms. Mobile and online ordering can be integrated for even greater ease and marketing potential, such as on splash pages shown when guests sign in to the hotel’s Wi-Fi. It’s the kind of easy-order/rapid-delivery offering that’s made delivery services like GrubHub and UberEats rising staples for travelers, and hotels are now working to keep that revenue from being spent on those types of outside vendors.

“As an operator, (third-party delivery services) make me think, ‘Why aren’t we capturing a portion of this revenue? What do we need to do?’ That’s why we’ve started experimenting with some of that to-go-type service at our properties,” Green said. “I can see pantry delivery being the thing of the future, where people can pop up the menu and say, ‘Hey give me one of those Asian salads, a wrap and two bottles of water,’ and you bring it to them in a bag. It’s very easy, and similar to the experience they have if they order delivery. It has to be an alternative that makes sense, or you’re going to have a constant stream of delivery drivers in the lobby.”

By: Chris Green
Virtually everyone has been riding a wave of prosperity and rising numbers over the last few years. But now, with the revenue per available room growth curve flattening out and leaner times ahead, savvy hoteliers understand that it isn’t enough to simply go along for the ride.

Looking ahead, it is incumbent upon proactive hotel owners and operators to assess their approach; is your marketing and sales team making the most of their opportunities? Specifically, at a time when powerful, new technologies, the explosive growth of social media platforms and the evolution of new communication modalities are changing the way we communicate with and market to core audiences and professional partners.

Prudent hoteliers will weigh the importance of leveraging the effective use of technology while simultaneously strengthening personal communication and nurturing client relationships.

Teching in
A great deal has been written about the affinity for technology among millennials, as well as members of Generation X and Generation Y. A large (and growing) segment of the population today communicates more effectively and stays connected largely through texting, email, Twitter, Facebook and other social media channels.

As efficient as these tools are, there is an inherent and unavoidable level of impersonal disconnection that creeps in—even as we may feel more connected than ever. At least one study has suggested that as much as 93% of communication is based on nonverbal body language. Can you afford to ignore this fact when trying to develop long-term business relationships?

From a sales and marketing standpoint, there is a similar conflict at work. Even as we are “in touch” with our customers more often, we are in some ways more disconnected from them. At the same time, the growing focus on e-commerce and digital communications has eroded some of the “old-school” focus on leveraging data, tracking down opportunities and engaging in the kind of face-to-face and highly personalized engagement that can yield significant and sustainable lines of business.

In some ways, we have lost (or at least temporarily misplaced) the important art of effectively selling our hotels. We must strive to find ways to connect personally to establish strong and binding relationships with our clients.

It takes a great deal of focused effort and engagement to work closely not just with travel agencies, but with individual agents, cultivating and maintaining those all-important personal relationships. Doing your homework, tracking down information and making personal connections that literally and figuratively pay off, all takes time and resources.

Get personal
The very definition of hospitality—“to create a warm and sincere welcome”—can be potentially compromised by an over-reliance on technology. An email or a text may be convenient, but is it warm? Can it evoke the same sense of connection that a big smile and a one-on-one conversation can convey so effortlessly?

New technology and communications tools are very efficient for transactional business, but there are very real limitations with respect to relying exclusively on these tools in a marketing and sales context.

Complementing technology with engagement is absolutely essential. Make it a point to get out to see your major clients and connect with agents and brokers—not just at sales meetings, but through regular personal touches.

Customized, not digitized
A detailed digital sales strategy is an important piece of the sales and marketing puzzle for any hotel. However, we cannot become so enamored with the convenience of digital communication and the power of e-commerce that we neglect valuable and lucrative sources of business generated through more traditional engagement.

The trick is to use technology and market intelligence strategically: not as a standalone strategy, but as a complementary piece that helps you enhance business relationships. Utilizing advanced BI Tools like Demand 360 and Agency 360 from TravelClick, or the Knowland suite of services, can help you identify key bookers. Direct sales calls on those agencies that don’t typically see sales people is not only a way to tap into new business, but also a way to forge valuable connections.

Stay vigilant
Communication methods may change, but the importance of establishing a personal connection remains constant. Different generations may have disparate preferences and comfort levels in regards to their favored communication platforms; it is up to us as hotel professionals to understand, adapt and respond accordingly.

We must constantly strive to find ways to stay connected with our guests and clients through face-to-face and voice-to-voice communications. We must take full advantage of powerful new digital communications tools, while striving to make electronic communication more personal and sincere.

In the years ahead, hospitality professionals who can strike the right balance and effectively use personal engagement to foster relationship-building will find themselves well positioned to compete in an ever-changing marketplace.

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