Consider these astounding numbers - it is forecast that in 2016 there will be 196 million smart phone users in North America alone. Worldwide the number of users is expected to surpass 2 Billion. According to hotel internet marketing firm HeBs Digital, currently more than 21% of online bookings and nearly 19% of room nights are generated from mobile devices (smart phones and tablets), while 45% of web visitors and nearly 40% of page views originate from them as well. Consumers are also increasingly using their smart phones for search queries, with more Google searches taking place on mobile devices than on computers in 10 countries, including the U.S. and Japan. Advances in mobile technology have changed the game forever and for hotels, that means having a mobile strategy is now as critical and necessary as having an Internet presence. Hotels must engage guests/travelers on their mobile devices and to add value to their experience. Mobile check-in, mobile payment options and mobile SmartKeys are quickly becoming commonplace features, as is the capacity for guests to place requests for all hotel services directly from their mobile device from anywhere on the property. In addition, some larger chains are creating their own apps which serve to enhance other facets of their operations - marketing, branding, cross-selling and impulse buying - all of which contribute to increased revenue and guest satisfaction. Still other companies are experimenting with the potential uses of wearable technology and the possibilities of geo-targeting promotions. The January Hotel Business Review will explore what some hotels are doing to maximize their opportunities in this mobile space, and will report on the solutions that are proving to be most beneficial for both companies and their guests.
A comprehensive social media strategy is now a must for any hotel that that wishes to remain relevant in today's hyper-competitive market. Every leading hotel company has made a major commitment to social media implementation in an effort to cultivate community engagement, broaden their market research, and enhance their brand and reputation - all with the intention to drive conversion and incremental sales. Furthermore, a social media strategy is required in order to satisfy guest expectations. Today's travelers are smart, savvy and sophisticated social media users who presume that these forms of engagement will be readily available to them. Therefore, not only must hotels decide which communication platforms to adopt (Facebook, Twitter, Google+, YouTube, Pinterest, Instagram, Flickr and more) but also how to use them to their best advantage. Some hotel chains are now using Twitter as a means to book hotel rooms while others are using Facebook to conduct market research. Photo and video sites increase online rankings if they are properly optimized, and blogs have become a popular tool for promoting an operation's credibility and trust. Some companies are emphasizing the development of branded online communities while others are using social platforms to create reward and incentive programs. Conducting surveys and polling have also become a means to directly engage customers and to collect useful data and, of course, online reputations have to be monitored and managed on travel review sites. The February Hotel Business Review will explore these vital issues and examine how some hotels are successfully integrating social media into their operations.
The hotel industry is notoriously rife with employee issues and human resource professionals are typically charged with the task of solving them. These issues can often seem daunting, given the myriad of problems HR departments encounter every day. Increasingly, issues such as workplace violence, workplace safety, workforce diversity, drug and alcohol abuse, labor shortages, inter-departmental conflicts, and compliance with all legal, employment and government regulations have become more prevalent in recent years. However, according to a recent survey, the biggest challenges human resource professionals face involves recruiting, training, retaining and rewarding employees. More than one-half (59%) of HR professionals believe that recruiting, training and rewarding their best employees, and developing the next generation of corporate leaders, will be their greatest challenges. About one-third (34%) predict the challenges will be creating a corporate culture that attracts the best employees, and finding people with the specialized skills the organization requires. Of course, all of these efforts are part of a strategy to reduce employee turnover - an issue that continues to plague the industry. An average hotel spends 33 percent of its revenues on labor costs, but employee turnover in the industry can be as high as 31 percent. A high rate of turnover dramatically disrupts operations and profitability, and it falls to HR professionals to address and resolve this area of concern. The March Hotel Business Review will document some of the biggest challenges HR professionals are currently facing, and will report on some of the best practices they are employing to achieve their goals.
There is good news for the hotel industry. According to a recent survey by J.D. Power & Associates, travelers are more satisfied than ever with their hotels. Overall guest service satisfaction reached a score of 804, up 20 points from last year. It was the first time satisfaction has surpassed the 800-point mark (on a 1000-point scale). At the same time, there was a 20% reduction in the number of guests who reported a problem during their stay, which was the lowest number reported since 2006. How does this news pertain to customer experience management? Because the survey also found that employee demeanor has a significant impact on how satisfied guests are. The average number of problems experienced when a staff member greeted guests with a smile "all the time" dropped 50% compared to when they were smiled at only "sometimes." The study also showed that guests are more loyal when they walk away from their stay feeling "delighted." Among those who were delighted, 80% said they "definitely will" recommend the hotel to a friend, relative or colleague, and 66% said they would stay again. These are colossal numbers which indisputably prove how crucial hotel employees are in achieving guest satisfaction. It is imperative that management be absolutely committed to recruiting the best talent, and then offering a wide-array of training and development procedures to facilitate superior and consistent guest service performance. The April issue of the Hotel Business Review will document what some leading hotels are doing to cultivate and manage guest satisfaction in their operations.
The hotel community continues to embrace sustainable development as a means not only to protect our environment, but also to optimize efficiency, realize cost savings, enhance guest satisfaction, improve employee morale, and manage investor expectations. Despite the lack of universally accepted metrics, the leading chains have incorporated eco-friendly policies, procedures, programs and training into their operations - both internally and externally - and their successes have been impactful and dramatic. In addition to more standard implementations such as LED lighting, waste recycling, reusing guest linens, and low-flow water regulators, some hotels have adopted more far-reaching solutions - commitment to the use of renewable energy; use of eco-labeled products; reduction of paper usage; purchasing of locally sourced and seasonal produce; ongoing measurement of carbon emissions; monitoring and analyzing energy consumption, the selection of suppliers and sub-contractors based on their own commitment to protect the environment; and compliance with all international environmental design standards. Remarkably, this comprehensive approach has resulted in enormous savings for some hotel operations. One major chain is projecting that it will realize US$1 billion in savings across the company's portfolio in less than 10 years. In addition, sustainability has become an important factor for guests when choosing a hotel. They want to know that a hotel has made a commitment to sustainable practices, and they expect honest and transparent communication about what steps a hotel is taking to produce a smaller carbon footprint. The May issue of the Hotel Business Review will document how some hotels are integrating eco-friendly practices into their operations and how they and the environment are benefiting from them.
Hotel Sales & Marketing departments have endured massive change in the past few years in terms of how they conduct their business, and there is little evidence to suggest that things will be slowing down anytime soon. Technological advances continue to determine how they research, analyze, plan, engage and ultimately sell to their customers. Though "traditional" marketing is still in the mix, there has been a major shift in focus toward online marketing. First and foremost is an understanding of who their primary audience is and how to market to them. Millennials (those born between 1981-1997) are the fastest growing customer segment in the hospitality industry, and they are expected to represent 50% of all travelers by 2025. With the rise of millennial consumers, sales and marketing efforts will need to be more transparent and tech savvy, with a strong emphasis on empathy and personal customer connection. Social media is essential for this demographic and they expect hotels to engage them accordingly. Other targeted groups include cultural buffs, foodies, LGBT, and multi-generational travelers - all of whom are seeking novel experiences tailored specifically to their interests and needs. Finally the Baby Boomers are still a force to be reckoned with. They are currently the wealthiest generation and are becoming increasingly tech savvy, with 33% of internet users now falling into this demographic. It is imperative that hotels include this generation when it comes to their 2016 digital marketing strategies. The June Hotel Business Review will examine some of these markets and report on what some sales and marketing professionals are doing to address them.
The Spa/Wellness movement that exploded a few years back continues to reverberate and expand. Once considered to be an "add on" (which was often relegated to an unused space in the hotel basement), spas are now front and center within the hospitality industry, and hotel management is realizing just how much a luxurious spa can contribute to the bottom line. Room rates are higher. Bar tabs are higher. Food checks are higher. In addition, guests now frequently choose a hotel based on its available spa services, so having a spa within the facility can provide significant financial returns. Plus, guests are using those services in new and novel ways. Some guests are requesting treatments upon arrival (as a way to counter jetlag or to kickstart productivity) and they are often booking their sessions through a hotel app. Some hotels are even offering free massages upon check-in as an inducement to stay. Still other guests are building their entire travel and vacation plans around exotic spa and wellness experiences and of those, thermal hot springs are currently very popular. More and more people are seeking out thermal hot springs as an affordable, social and naturally therapeutic spa experience. Honeymooning couples are seeking out spa packages designed just for them. Couples massages, aromatherapy treatments and nutritious cooking classes make for a romantic and healthy honeymoon they can both enjoy together. Other leading spas are offering stress management courses, classes in meditation and yoga, anti-aging treatments, and spa services designed specifically for men. The July issue of the Hotel Business Review will report on all these trends and developments and examine how hotel spas are integrating them into their operations.
According to industry tracker PKF Hospitality Research, food and beverage sales represent the second- largest source of revenue for full-service hotels behind rooms. Given its financial importance, hotel operators are constantly adapting and evolving their F&B operations in order to remain current with industry trends and to meet (and exceed) guest expectations. Recent food developments which continue to proliferate include the farm-to-table movement; customized menus for those who are vegan, vegetarian, paleo or gluten-free; the appearance of smaller dishes on tasting menus; and creatively- prepared comfort foods served in more casual settings. In fact, there is a growing emphasis in the entire industry on more casual food operations. Customers are eschewing the typical breakfast-lunch- dinner/appetizer-entrée-dessert model in favor of "fast-casual" menus and service (think Panera, Chipotle or Cosi as examples). Even better if these menus are also available throughout the property, especially in social-gathering areas like the lobby, pool or bar. Some hotels are also experimenting with "pop-up" restaurants - a temporary dining option with edgy menus and design served in unexpected locations (like rooftops or lobbies) - as a way to keep things energetic and fresh. Another trend which applies to both food and wine is the option to purchase food and beverages in multiple sizes. Some operations are giving their customers the opportunity to choose - a three ounce pour of wine or a nine-ounce pour; a six-ounce filet or a twelve-ounce - the customers decide their portion size and pay accordingly. The August issue of the Hotel Business Review will document all these trends and challenges in the food and beverage sector, and report on what some leading hotels are doing to enhance this area of their business.
Corporations and businesses are once again renewing their investments in people, strategic planning, and training and development. As a result, all indicators point to 2016 being a robust year for the hotel group meetings business. Group demand is strong and rates, especially during peak periods, are trending up. Still, hotels must continue to evolve to meet the changing expectations of group meeting planners and their clients. There are several trends and factors that are driving decision-making which planners have identified as being essential to the process. Though geographic location and room rates continue to be the most important factors when selecting a host property, food and beverage choices are becoming increasingly influential. Planners understand the value of first-class culinary options as these are often used to facilitate networking experiences. Another critical factor is the availability of sufficient bandwidth for high-speed wired and wireless connectivity to the internet. In addition, in an effort to eliminate unsightly and unwieldy power cords, planners are requesting the installation of mobile-device charging stations. These portable charging stations (which do not require devices to be plugged in) can be conveniently placed in common areas or directly in meeting rooms. Finally, there is a greater emphasis on teambuilding activities that are intended to challenge groups, and bring them closer together. Some hotels are offering scenic walking trails, GPS-aided scavenger hunts, kayaking into secluded coves or rollerblading on oceanfront boardwalks, among many other recreational activities. The September Hotel Business Review will examine issues relevant to group business and will report on what some hotels are doing to promote this sector of their operations.
Revenue Management is a dynamic and ever-evolving profession and its role is becoming increasingly influential within hotel operations. In some ways, the revenue manager's office is now the functional hub in a hotel. Primarily this is due to the fact that everything a revenue manager does affect every other department. Originally revenue managers based their forecasting and pricing strategies on a Revenue per Available Room (RevPAR) model and some traditional hotels still do. But other more innovative companies have recently adopted a Gross Operating Profit per Available Room (GOPPAR) model which measures performance across all hotel revenue streams. This metric considers revenue from all the profit centers in a hotel - restaurants, bars, spas, conference/groups, golf courses, gaming, etc. - in order to determine the real gross operating profit per room. By fully understanding and appreciating the profit margins in all these areas, as well as knowing the demand for each one during peak or slow periods, the revenue manager can forecast and price rooms more accurately, effectively and profitably. In addition, this information can be shared with general managers, sales managers, controllers, and owners so that they are all aware of and involved in forecasting and pricing strategies. One consequence of a revenue manager's increasing value in hotel operations is a current shortage of talent in this field. Some hotels are being forced to co-source or out-source this specialized function and in the meantime, some university administrators are looking more closely at developing a revenue management curriculum as a strategy for helping the hospitality industry close this gap. The October issue of the Hotel Business Review will address these significant developments and document how some leading hotels are executing their revenue management strategies.
Corporate hotel developers once believed that their customers appreciated a homogenous design experience; that regardless of their physical location, they would be reassured and comforted by a similar look, feel and design in all their brand properties. Inevitably this led to a sense of impersonality, predictability and boredom in their guests who ultimately rejected this notion. Today's hotel customer is expecting an experience that is far more original and authentic - an experience that features a design aesthetic that is more location-oriented, inspired by local cultures, attractions, food and art. Architects and designers are investing more time to engage the local culture, and to integrate the unique qualities of each location into their hotel design. Expression of this design principle can take many shapes and forms. One trend is the adaptive reuse of existing facilities - from factories to office buildings - as a strategic way to preserve and affirm local culture. Many of these projects are not necessarily conversions of historic properties into grand, five-star landmark hotels, but rather a complete transformation of historic structures into mixed-use, residential, and hotel projects that take full advantage of their existing location. Another trend is the addition of local art into a hotel's design scheme. From small sculptures and photography to large-scale installations, integrating local art is an effective means to elevate and enhance a guest's perception and experience of the hotel. These are just a few of the current trends in the fields of hotel architecture and design that will be examined in the November issue of the Hotel Business Review.
The hotel industry is a vast international enterprise that requires the professional expertise of legal specialists in all kinds of fields. From hotel acquisitions, finance, compliance and labor issues to franchise, management and bankruptcy issues, the practice of hotel law is as varied as the industry itself. Though the subject matter is far-reaching, there are several legal issues which are likely to gain attention in 2016 and beyond. For instance, hotel managers have to be unceasingly vigilant in order to comply with the Fair Labor Standards Act (minimum pay, overtime pay, equal pay, child labor, etc) but currently the issue surrounding "living wage" increases is also gaining traction, especially in the hotel and restaurant sectors. This is a highly contentious issue and no doubt hotel lawyers will continue to press their concerns on behalf of their clients. Another concern pertains to a recent Supreme Court decision which ruled that it is unconstitutional for local police departments to require hotel operators to produce their guest registries on demand. As a result, hotel managers across the country will now have to educate their associates in order to comply with this new ruling. A novel approach to raising investment capital is becoming increasingly popular with developers who are using the EB-5 program (foreign investment in exchange for green cards) and crowd-funding sources to finance business start-ups and expansions. In addition, there are ongoing issues pertaining to the implementation of the Affordable Care Act, and heightened scrutiny surrounding immigration policies. The December issue of Hotel Business Review will examine these and other critical issues pertaining to hotel law and how some companies are adapting to them.