Disasters, cycle worries dominate 2017's top stories
Disasters, cycle worries dominate 2017's top stories
27 DECEMBER 2017 8:50 AM

Change and strategies for weathering the storm, both literally and figuratively, were top of mind for hoteliers in 2017, if the year’s top stories are any indication.

GLOBAL REPORT—Hoteliers were thrown some curveballs in 2017, and spent much of the year anticipating the big one: a downturn in the cycle that has yet to materialize.

A look back at some of the top headlines on Hotel News Now this year offers some insight into what was on hoteliers’ minds and radars, as well as how they have dealt with or prepared for that all-encompassing worry: Change.

As AccorHotels CEO Sébastien Bazin said during an on-stage interview with HNN’s Stephanie Ricca at the South American Hotel Investment Conference in October: “In today’s world, either you change or you will be changed.”

Bazin has garnered a lot of attention for how he has reacted to and led change since joining France-based AccorHotels in August 2013, transforming it into one of the most powerful and innovative hotel companies in the world. For a story in May, HNN’s Terence Baker recounted the highlights of Bazin’s career at AccorHotels.

Another transformative force during 2017 came in the form of hurricanes, earthquakes and wildfires.

No amount of preparation could have fully insulated hotels against a season of natural disasters, which included hurricanes that struck the Texas and Florida coasts, parts of the Caribbean and Puerto Rico this fall, devastating hotels in the hardest hit markets and providing a boon to those that took in evacuees and relief crews.

Hotel News Now reached out to hoteliers to assess the impact of hurricanes Harvey and Irma as the situation unfolded.

Andrea Foster, SVP of development for Marcus Hotels & Resorts, said about the lingering effects of Hurricane Harvey: “It’s just going to get bigger and bigger. We will see projects down; we will see labor challenges. This isn’t going to be just an issue in Texas; this is going to be a big impact nationally.”

Hotel companies touted the preparation and response of their associates in the affected markets, including efforts to shelter and assist their communities.

In the aftermath of Hurricane Irma, Ted Middleton, Hilton’s SVP of development for Latin America, said: “Our primary concern has been the safety and security of our guests, team members and the first responders. … We’re doing everything we can to help the communities and first responders with this disaster and hope we’ll get back to normal very quickly.”

The figurative storm that has yet to strike the hotel industry, the anticipated cycle downturn, weighed heavily this year on the minds of hoteliers, who searched the data for any visible warning signs, which might be used to predict when and how it might happen.

Jack Corgel, managing director of CBRE Hotels’ Americas Research, provided an analysis of which U.S. hotel markets might be “on the bubble,” and just when it might pop.

“During the next four years, a handful of markets are forecast to have the hotel property value growth characteristics to justify being on the bubble watch list,” Corgel wrote.

Hoteliers were keen also to identify trends in data presented during the Lodging Conference in Phoenix in late October. Ali Hoyt, senior director of consulting and analytics at Hotel News Now’s parent company STR, noted at the time that U.S. hotel demand continued to outpace new supply, leading to record peaks in occupancy. Meanwhile, Mark Woodworth, head of hotels research for the Americas region at CBRE, said: “We’re plodding along faster than a tortoise would be, but still not quite what we’re used to.”

Ultimately, hoteliers looked to translate these big-picture trends and events into property-level strategies to leverage demand to grow rate, and mitigate losses from disruption.

Taking an ever-growing role in leading this initiative are hotel revenue managers, who, as HNN’s Sean McCracken noted in a story in July, are no longer “behind the scenes.” Jamie Pena, VP of revenue strategy and global distribution for Omni Hotels & Resorts, said about the distinction between revenue management and sales: “Revenue management is like a scientist, while marketing and group sales are artists. They’re going to creatively figure out what’s needed for the business.”

Along those lines, one revenue-management strategy that has gotten a lot of attention this year is overbooking guests, especially as a solution to tightening cancellation windows.

In determining when to overbook, it’s also important to look at factors such as market compression, sources told HNN contributor Alicia Hoisington for a story in March.

“If you have a big citywide (market), you don’t want to oversell as much because the market is compressed enough,” said Wendy Norris, corporate director of revenue and e-commerce at the Valencia Group.

If walking a guest to a nearby property becomes necessary due to overbooking, hoteliers should have policies in place to ensure it’s not a negative experience for the guests, sources said for another story in June.

“During this process we qualify each guest based on rates, length of stay and the medium of which they booked their room to verify before arrival,” said Brent Gresham, area manager of The Spectator Hotel, French Quarter Inn and HarbourView Inn in Charleston, South Carolina. “This allows us to determine which guest might be open to us walking them over to one of our sister properties. If it’s a guest that has stayed with us before, more likely than not we know their personality and if they’d be open to staying at a sister property this time around.”

Focus was also directed this year at brand strategies for growth.

HNN’s top story for February looked at how the Sheraton brand looked to align its strategies for improvement with flagship Marriott International, after being acquired as part of Starwood Hotels & Resorts Worldwide in 2016.

“That playbook … we’re sort of like the Williams sisters (Serena and Venus) of tennis,” said Brian McGuinness, SVP and global brand leader for Marriott Hotels, Sheraton and Delta Hotels. “We practice together, strategize and at the end of the day we go to a match. It’s good to collaborate and look for synergies.”

There was also a lot of attention on Hyatt Hotels Corporation’s plans for growth in the wellness sector following the company’s acquisition in January of spa resort brand Miraval Group.

“What we ID’d with the Miraval opportunity was an opportunity to accelerate how we care for those customers and guests,” Hyatt President and CEO Mark Hoplamazian said at the time. “And we can do that in a very different way than how hotel companies have approached it in the past.”

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