Coyle Hospitality attended ALIS (The American Lodging Investment Society) in Los Angeles which took place from January 25th through to January 27th. As always, it is great to ‘get out of the box’ for a few days and reconnect with clients and colleagues.
The theme of ALIS 2016 conference was “Where’s the Peak?” Amid the financial and investment discussion – the state of the hospitality industry for 2016 is cautious optimism, with the caution becoming ever more prevalent. It wasn’t long ago that China was seen as ‘low-hanging fruit’, and now the tone centers around headwinds and difficulties there. The strong dollar will likely continue to mute travel to the US, and while all agree low energy costs are a great thing for all hoteliers, it has mysteriously yet to translate into demand.
In terms of guest service, the message throughout the conference revolved around two key points:
Major brands are re-aligning themselves with a key demographic of today’s consumer, the ubiquitous Millennial. Bonding, listening, creating loyalty and engaging with the guest are all part of everyone’s secret sauce. Brands on a macro-level are already moving there with Moxie and Tru, followed by consolidation in the Lifestyle space. And yes, while the topics at ALIS often center on guest acquisition, there seemed to be more talk about guest retention. Perhaps this is proof that the industry is cycling. When times get tougher, all hotels big and small need their current customers to come back; getting new guests is costly, competitive and low-margin.
Our hotel mystery shopping data provides a pretty clear roadmap for the above. Providing a fast, seamless check-in, making sure the arrival staff exudes confidence and care, and actively and effectively solve any issues that may arise. The millennial may be less loyal to their ‘parent’s hotel brands’, but they truly appreciate authenticity, value, and service.
Taking greater control of the distribution of their brands. Major Brands are looking to communicate more directly with their clients and clearly differentiating their offer. In the “Shadow of the Peak” were occupancy dilution by AirBnB and revenue & Customer Loyalty dilution by OTAs such as Expedia and Priceline.
This is perhaps the most worrisome change for our industry. As OTAs continue to grow and maintain a large percentage of hotel reservations, they are de facto assuming a significant part of the guest experience.
Our hotel market research data shows that hotel guests who book through third parties hold the hotel accountable for that experience. Responding to bad reviews online is the minimum that needs to be done. The point-of-view that a guest obtained via the OTA channel should get the worst room, should be changed to ‘Why did this first time guest choose us?’ and ‘How do we learn what will keep them?’
For more about ALIS or how our Hotel Brand Evaluations work for the top companies around the world contact us today.