In a recent AHLA Forum, Marriott International President and CEO Arne Sorenson spoke about how his company responded to the coronavirus pandemic and what a potential path forward looks like.
REPORT FROM THE U.S.—As the hotel industry navigates its way through the coronavirus pandemic, it often looks to leaders in the industry for guidance.
During the American Hotel & Lodging Association’s first installment of its new leadership series, “The Forum,” AHLA President and CEO Chip Rogers posed questions to Marriott International President and CEO Arne Sorenson and Maryland Gov. Larry Hogan.
Here are some takeaways from Sorenson’s responses:
The team at Marriott had to make decisions across the industry that are in a gray area, and they had to make those decisions faster than research under normal conditions would allow, Sorenson said. Executives furloughed 70% of their staff at the company’s corporate headquarters within weeks of COVID-19 becoming present in the U.S., he said.
“We have never made a decision like that before, and we made it in the context of monumental uncertainty about how long this crisis would last, an uncertainty we still sort of confront today,” he said.
The same is true of its franchisees, in that the company is making sure that it is listening and acting quickly, he said. They are making sure they are collectively prepared to make the decisions necessary to protect their people, their guests, their franchisees and the company.
There are a thousand lessons to take from this pandemic, Sorenson said. Looking at China, where this coronavirus originated, the Chinese government essentially shut down the country by the end of January. Hotels there dropped occupancy by 90%, a number comparable to what hotels in Europe and the U.S. experienced months later. Occupancy in China now is in the 40% to 50% range, he said.
“We have come up a long way from the bottom—still quite a bit off of where we would have been before, but that shows you something about a potential path forward when government restrictions are released and, equally important, when travelers believe it is safe,” he said.
“They need to know that it’s not only legal, but they need to know that they can get out there and do what they want to do and not risk their own lives. When those things become available, a recovery will happen.”
Wearing masks has become too politicized, which is a tragedy, because wearing a mask is a significant part of how hoteliers earn consumers’ confidence, Sorenson said. It’s complicated from both a business and government perspective about exactly how much they are permitted to require a certain behavior in a country like the U.S. where there is a strong sense of personal liberty, he said.
When a hotel is full of guests at the beach or over Memorial Day weekend, there will be certain percentage of guests who want everyone wearing masks, to have no one near them and feel reasonably protected, he said. Similarly, there will be a percentage of people who are not worried about the pandemic, who want to enjoy the beach or the pool and be able to get a beer at the bar without having to wear a mask if they don’t want to.
There will be an occasional tiff between these two groups of people, but the group of people who want everyone wearing a mask likely won’t get into a fight with someone over it, he said. If they feel the other guests are exposing them to an unhealthy environment, they’re going to stay home and say they’re not ready yet to travel.
While there is a role for state governments to take in this, the industry has an influence over this and should make sure it’s leaning toward the most cautious set of rules on cleanliness and mask-wearing, he said.
The recovery from the pandemic has already started, but it would be a mistake to think it will be like flipping a switch and employment, economic performance and other metrics return to normal, Sorenson said.
“It’s going to take some time to get back there because the impact of this has been so incredibly, profoundly disruptive,” he said.
Looking at the American traveler today, they might not be traveling for work or for big conventions, but as they’re permitted by the states they live in to travel, they are going to see family or visiting places with beaches or trails for hiking, he said.
No one knows what the full recovery will look like or when it will happen, but it’s likely going to take a number of years, Sorenson said. It will require confidence in the safety of travel, which can only happen when people have a sense that COVID-19 is behind them.