Consultants agree that hotel owners, operators and developers must stay educated about all aspects of the global hotel industry, including the all-important topic of consumer trends.
BANGKOK—From “insane” to “dynamic” to “cautious”—and just about everything in between—consultants participating in the Hotel News Now roundtable discussion conducted in conjunction with the recent International Society of Hospitality Consultants annual conference indicated there’s a plethora of ways to describe the state of the global hotel industry.
There was plenty of optimism among the participants at the Bangkok InterContinental Hotel as they outlined the word they would use to characterize the current environment.
Steven Seghers, president of Irvine, California-based Hyperdisk Marketing: “The word I chose was ‘cautious.’ The industry is feeling uncertain. When you look at the budgeting for 2018 and beyond, you’re seeing owners, you’re seeing developers take a more cautious approach to their focus in brand development and marketing and distribution. With the global economy being somewhat unstable and with the political environment there’s a lot of uncertainty. That’s causing the industry to pump the brakes a little bit, and certainly we are having to adapt to that almost two sorts of plans—the plan that we hope for and the plan that we don’t want but that we need to be prepared for.”
Rebecca Jones, principal with Baltimore, Maryland-based RD Jones & Associates: “I would describe business as ‘insane.’ After we (thought) that we would never recover after 9/11 and 2008, (the industry has) never had this volume and capacity of demand for design services, be it new construction or renovation. All the brands have—there are so many brands to cater to … it’s a new playing field.”
Jeff Dover, principal with Toronto-based FSStrategy: “The word I took is ‘knowledge.’ Our (food-and-beverage) consumers are so much more knowledgeable than they were. If you go back a generation or two, every town had a Chinese restaurant, every town had an Italian restaurant. But if Chinese or Italians came to them, they wouldn’t recognize the food. … So you have to be on point. People know what stuff should taste like. They know how recipes should be prepared. They know major dishes and quality ingredients and all that. And that’s really been a game changer as far as knowledge.”
Muriel Muirden, EVP of strategy for London-based WATG: “My word is ‘renaissance,’ because there’s a lot of change crossing over, sort of the perfect storm. We’ve got generational shifts. We’ve got lifestyle changes. We’ve got technology moving at a rapid pace. We’ve got interrupters. And this turmoil has forced the hand, I think, of hotels to rethink what they do, how they do it, how they’re designed.”
Ravish Jhala, director for Mumbai-based Haatt India Services: “My word is ‘quality’ because the quality which is given to the owners or branders is very limited.”
Joanne Jia, head of Asia for London-based Christie & Co.: “I will say ‘dynamic.’ If you look at the Asia market, especially the China market, people currently they do not talk about hotel only. If you look at the market, usually combine hotels. They combine the coffee shop. They combine leisure. They combine tourists. … The hotel industry is very competitive now, so they have to choose the operational way. This industry is really dynamic and becoming more interesting.”
Consumer trends: It’s all about the experience
Fueling the vast array of descriptions for the industry’s state are rapidly changing consumer trends—mainly because good ideas often are quickly imitated, according to the speakers.
“Things are changing so fast now,” Dover said. “The life cycle of a trend … if there’s a great idea, it doesn’t last long. You’ve got to be constantly reaching out to what’s going on, why are people deciding to go to a certain property, what’s driving that demand and how is that changing? And when it changes, reacting to it.”
Dover said the best way to identify trends is being out in the front lines and talking to customers and understanding why you are here, especially someone you haven’t met before.
“The most important thing is talking to people that are buying the product that you’re selling in your market and understanding why they made the choice they did,” he said.
Jones said the metamorphosis of the select-service segment is a good example of the hotel industry listening to consumers.
“Select service has actually produced, let’s say more on the (U.S.) side, higher quality products than what exist in the full-service market,” Jones said. “That’s where the new construction is, the new opportunity is. It’s become far more limited with the full-service market.”
That leads consumers on the quest for experiences at hotels—whether they are there for business, leisure or a combination of the two, the consultants said. It also creates challenges, and in some cases confusion, that hoteliers must address.
“Everybody is able to put this experiential moment into what they want to experience,” Jones said. “A lot has to do with the psychographic behaviors of saying ‘OK, I might be 60, but I still want to be hanging out with everyone at W.’ To respond to the brands and respond to the design challenges and the budgets that are allowed I think is really a fabulous opportunity, but we are really stretching to differentiate in each category all the brands.”
The “Instagram-worthy” experience is an important element for success, Dover said.
“You have to give somebody an experience that they’re going to market for you, and there has to be something that’s great, something that’s special about the room, something that’s special about the experience, something that’s special about the food, something that’s really cool, or something that they can talk about,” he said. “That will drive return business and that drives more business because I think it’s almost like we talk about millennials wanting experiences … they also want the status of being able to tell a lot of people ‘I’m doing this!’”
Muirden said looking at the sports and recreation market and retail market is important to see how people are using their time and how they’re spending their money can give some indications where the hotel industry should be heading.
“The complexities of the fitness and wellness market now, the innovations and mashups and all the new brands showing up there is an indicator that the hotel industry has to look far more innovatively at their in-house wellness and fitness packages,” Jones said. “What’s happening in terms of lifestyle behavior and retail behavior has implications downstream, but not too far downstream for hotels.”