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THE
PROGNOSIS
FOR MEETINGS
PLANNERS
INQUIRING ON
INDEPENDENTS
A TAKE ON
TOMORROW'S
LEADERS
HOW
MILLENNIALS
WILL
CHANGE
TRA...
3The 2020 Hotel Trend Report
MILLENNIALS’ TRAVEL SPENDING IS UP...
HOW
MILLENNIALS
WILL CHANGE
TRAVEL BY
2020
HIGHLIGHTS•	...
4
agency, 24% of millennials are planning to
take more overnight leisure trips in the coming
year than in the previous 12 ...
5The 2020 Hotel Trend Report
THE PROGNOSIS FOR MEETINGS PLANNERS
“Five years from now, I expect the hotel meetings landsca...
6
CONTINUED FROM PAGE 5
UP NEXT: FUTURE HOTEL DESIGN
INQUIRING ON INDEPENDENTS
“By 2020, the independently branded hotel s...
7The 2020 Hotel Trend Report
FUTURE HOTEL DESIGN TO
FUSE OLD AND NEW TRENDS
FIVE EXPERTS SHARE THEIR HOTEL DESIGN
PREDICTI...
8
CONTINUED FROM PAGE 7
“While it is difficult to know with certainty the hotel design
trends we’ll see in 2020, I do expe...
9The 2020 Hotel Trend Report
CONTINUED FROM PAGE 8
accommodate guests that want a human touch vs. those that want a tech-f...
10
AN ANIMATED GUIDE TO
THE FUTURE OF CHECK-IN
REPORT FROM THE U.S.—What will the hotel check-in process look like by the ...
11The 2020 Hotel Trend Report
IN 2020,
HOTEL BRANDING WILL …
One thing is certain: Hotel branding in 2020 will revolve
aro...
12
CONTINUED FROM PAGE 11
Jonathan Tisch, chairman of Loews Hotels, which owns and/
or operates 23 hotels in the U.S. and ...
13The 2020 Hotel Trend Report
CONTINUED FROM PAGE 12
Jim Holthouser, executive VP of global brands for Hilton
Worldwide Ho...
14
STR 2020 FORECAST: SUPPLY
TO STALL OCCUPANCY
Rate and revenue per available room will
have grown by leaps and bounds by...
15The 2020 Hotel Trend Report
UP NEXT: BOLD PREDICTIONS FROM HNN
CONTINUED FROM PAGE 14
U.S.OCCUPANCY&AVERAGERATEPERFORMAN...
16
BOLD PREDICTIONS
FROM HNNBy the HNN editorial staff
Predicting changes in the hotel industry is challenging under the b...
17The 2020 Hotel Trend Report
9 PREDICTIONS FOR THE GUESTROOM
OF THE FUTUREBy the HNN editorial staff
Guests will be able ...
ORDER UP! NEW ROOMSERVICE
OPTIONS ON THE MENU
High costs and tightened guest schedules are prompting
many hotel companies ...
19The 2020 Hotel Trend Report
Barrett, who also is MD of New Castle’s purchasing subsidiary
Provender LLC, added the brand...
20
CONTINUED FROM PAGE 19
Maxine Taylor, executive VP of asset management, The
Chartres Lodging Group: “I believe that we ...
21The 2020 Hotel Trend Report
CONTINUED FROM PAGE 20
Michael Heyward, director of hotel performance support
Europe, InterC...
22
5 HR HURDLES
(AND HOW TO PREPARE FOR THEM)
By Patrick Mayock, Editor-in-Chief
HIGHLIGHTS•	 Millennials are
looking for ...
23The 2020 Hotel Trend Report
Challenge: Retaining a fickly millennial workforce
The cohort born between 1980 and 2000
oft...
Solution: Stay abreast of employment law
HR professionals should learn from others’
mistakes, Sanders said. The best way t...
25The 2020 Hotel Trend Report
CONSOLIDATION COOKING IN
DISTRIBUTION SPACEBy Alicia Hoisington, Managing Editor
HIGHLIGHTS•...
And the competition won’t just come from
the likes of Google, either.
“OTAs will need to compete with generalist
online re...
27The 2020 Hotel Trend Report
3 MOBILE STATS YOU NEED TO KNOW
global mobile subscriptions by 2019
(In Q1 2014, there were ...
28
UNWTO: Tourism 2020 Vision
GLOBAL TRAVEL BY THE NUMBERS
Projected Market Share By Region In 2020
GLOBAL TRAVEL BY THE
N...
29The 2020 Hotel Trend Report
Projected Market Share By Region In 2020
SHARE OF WORLD BUSINESS TRAVEL SPENDING: DOMESTIC P...
CONTINUED FROM PAGE 29
30
SHARE OF WORLD BUSINESS TRAVEL SPENDING: DOMESTIC PLUS OUTBOUND INTERNATIONAL
UP NEXT: PRECARIOU...
31The 2020 Hotel Trend Report
PRECARIOUS PREDICTIONS
FOR THE GLOBAL ECONOMYBy Shawn A. Turner, News Editor
The hotel indus...
•	 International travel will be a big influence in 2020, Hartwich
said. Developing nations will continue to develop, and
o...
HOTEL NEWS NOW
18500 Lake Rd., Suite 310, Rocky River, Ohio 44116, USA
Tel: +1 615-824-8664
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Hotel Trend Report 2020

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Hotel Trend Report 2020

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Hotel Trend Report 2020

  1. 1. THE PROGNOSIS FOR MEETINGS PLANNERS INQUIRING ON INDEPENDENTS A TAKE ON TOMORROW'S LEADERS HOW MILLENNIALS WILL CHANGE TRAVEL BY 2020 FUTURE HOTEL DESIGN TO FUSE OLD AND NEW TRENDS AN ANIMATED GUIDE TO THE FUTURE OF CHECK-IN IN 2020, HOTEL BRANDING WILL ... STR 2020 FORECAST: SUPPLY TO STALL OCCUPANCY BOLD PREDICTIONS FROM HNN 9 PREDICTIONS FOR THE GUESTROOM OF THE FUTURE ORDER UP! NEW ROOMSERVICE OPTIONS ON THE MENU 5 HR HURDLES (AND HOW TO PREPARE FOR THEM) CONSOLIDATION COOKING IN DISTRIBUTION SPACE PRECARIOUS PREDICTIONS FOR THE GLOBAL ECONOMY 3 MOBILE STATS YOU NEED TO KNOW GLOBAL TRAVEL BY THE NUMBERS CONSOLIDATION IN THE CARDS FOR HOTEL INDUSTRY?
  2. 2. 3The 2020 Hotel Trend Report MILLENNIALS’ TRAVEL SPENDING IS UP... HOW MILLENNIALS WILL CHANGE TRAVEL BY 2020 HIGHLIGHTS• By 2017, millennials will outspend boomers on hotels, predicts Jason Dorsey. • Mobile devices will become the sole point of contact between hoteliers and their millennial customers. • Loyalty programs will change to adapt to the shorter attention span of millennial guests. REPORT FROM THE U.S.—By 2020 or sooner, millennials might dominate the travel demographic. Hoteliers need to understand the nuances of this group of guests and be prepared with product and services that meet their needs and expectations, sources said. “The number of millennial travelers is significant and growing fast,” said Jason Dorsey, chief strategy officer of The Center for Generational Kinetics, a consulting firm focusing on issues of millennial consumers. “It appears by 2017 millennials will outspend baby boomers on hotels. This will be a defining moment given that many hotel brands grew rapidly because of the boomers and all of a sudden the people with wallets are the millennials.” According to Anna Blount, research manager at travel marketing agency MMGY Global, millennials are already more likely to take vacations than those in older generations. According to research conducted by the By Ed Watkins, HNN contributor CONTINUE READING ON PAGE 4
  3. 3. 4 agency, 24% of millennials are planning to take more overnight leisure trips in the coming year than in the previous 12 months, she said. “They are the most passionate about travel; and they have the most motivation about why they want to travel; and they are the ones who want to take more trips, go see more places and spend more money on experiences than on things,” she said. The travel patterns of millennials will shape strategies of hotel companies in the coming years. “Millennials are very used to getting things quickly and easily without the encumbrances that perhaps Gen X and the boomers grew up with,” said Tina Edmundson, global officer for luxury and lifestyle brands at Marriott International. “When you think about what companies Uber or Apple have done for millennials’ expectations—not just for product but also for service—it will be incumbent upon the hotel industry to understand how that changes what we do.” According to Dorsey, property-level changes areinevitableasmillennialsrisetodominance. “The typical hotel experience today was designed for baby boomers. You walk in; someone greets you; and you stand in a line,” he said. “Millennials never stand in line, so this (procedure) will be disrupted. There will be no more lines, and the process of checking in, looking someone in the eye and answering the same questions you answer all the time will all change.” Dorsey said the mobile device will be millennials’ sole point of communication with the hotels they use. “It’s not just the check-in, but also it will be how I communicate if I want a drink or a towel or directions to the gym,” he said. “There won’t be a need for people-to-people conversation for millennials once they and hotels get accustomed to using that screen as a connection point.” Loyalty and millennials Blount said her agency’s research shows millennials tend to be as loyal to hotel brands as are members of other demographic groups. She said 49% agreed with the statement, “I have a few hotel brands I like and rarely stay with others.” Edmundson believes that in many cases millennials have yet to develop brand loyalties. “It’s not that they aren’t loyal; they’re now in their formative years and are experiencing the brands that they may or may not become loyal to in the future,” Edmundson said. “This is the time for them to experience a wide variety of brands before they make a loyalty decision.” Dorsey sees major changes ahead in hotel loyalty programs to match the psyche of millennials. “Right now, loyalty programs are based on the number of stays or nights, which is not the best way to incentivize millennials or build their loyalty,” he said. “They are much more into shorter-term rewards.” CONTINUED FROM PAGE 3 UP NEXT: EXPERTS’ QUOTES
  4. 4. 5The 2020 Hotel Trend Report THE PROGNOSIS FOR MEETINGS PLANNERS “Five years from now, I expect the hotel meetings landscape will show continued growth and demand. From the planner perspective I believe hotels will see greater pressure to provide more amenities and services geared towards the tech-savvy consumer. I believe there will also be more convergence between face-to-face and virtual meetings.” —Matthew Marcial Meeting Professionals International “When millennials become senior leaders, they will be very different than today's leaders. Twenty-four-hour news, the Internet and social media, entertainment, the most diverse political/cultural/educational role models of any generation make their perspectives, expectations, views of the world and contexts for decision making and leadership very different. Their approaches will be more encompassing and apply more criteria and considerations as they make decisions and function as leaders. The implications are for greater inclusiveness, concern for environmental issues and social responsibility, as well as their views of how they fit into both their personal social and business environments. Among millennials, there is also greater choice and diversity of levels of ambition and desire to lead than any generation. I am curious and excited to see the outcomes.” —Bjorn Hanson Preston Robert Tisch Center for Hospitality and Tourism, New York University A TAKE ON TOMORROW’S LEADERS CONTINUE READING ON PAGE 6 HNN ASKED EXPERTS TO TELL US IN 100 WORDS OR LESS WHERE THEY SEE CERTAIN ASPECTS OF THE HOTEL INDUSTRY BY THE YEAR 2020
  5. 5. 6 CONTINUED FROM PAGE 5 UP NEXT: FUTURE HOTEL DESIGN INQUIRING ON INDEPENDENTS “By 2020, the independently branded hotel segment (will) double in size. No longer will the question from investors and lenders be, ‘What flag are you going to put on the property?’ Rather, it will be, ‘What’s best for the asset—build my own brand or leverage someone else’s brand?’ And leveraging an existing brand will be scrutinized through the lens of what are the incremental benefits to the asset for the incremental costs. The volume of research on the value of brands will exponentially increase, raising awareness of the independent options available. Equally important, rapid consumer adoption of the independent hotel experience will drive demand for more product, including new builds and conversions. And loyalty will be much less driven by points and much more by experiences, memories and service. However, the segment faces challenges: soft brands launched by the major chains as alternatives to hard flags, continued resistance from lenders and the ever-changing distribution landscape.” —Alex Cabañas Benchmark Hospitality International “Firstly, looking at real estate play in the U.K., we have seen continued investor appetite over recent years from private equity looking to place a large quantum of capital into substantial hotel platforms, reflecting the weight of capital chasing low interest rates and cyclical upturns. The exit strategy of many private equity houses, coming to the end of their holding period, will be to bolt on single assets or other portfolios, building critical mass and restructuring to appeal to real estate investment trusts or looking to initial public offerings. It is likely that we will see a degree of consolidation through this building process. Internationally, and taking a view of the operators, it is likely we will see some consolidation in the short to mid-term. Operators can obviously benefit from many synergies, cost efficiencies and a diverse offering that in turn can drive further opportunities for growth. With performance looking good in all key, global markets, now would seem a favorable time in the cycle for any consolidation to take place.” —Jonathan Langston Senior director and head of professional services at CBRE Hotels’ London office CONSOLIDATION IN THE CARDS FOR HOTEL INDUSTRY?
  6. 6. 7The 2020 Hotel Trend Report FUTURE HOTEL DESIGN TO FUSE OLD AND NEW TRENDS FIVE EXPERTS SHARE THEIR HOTEL DESIGN PREDICTIONS FOR 2020. By Samantha Worgull, Editorial Assistant Hotel design trends in 2020 will be molded around guest-facing technology and sustainability, according to five design experts. Hotel News Now asked the experts to share their thoughts on design trends in 2020, and the answers ran the gamut from 3-D printing technology to sustainability to the evolution of food- and-beverage. Additionally, the design trends will be centered on providing a unique and authentic experience, a trend that is unlikely to go away, the experts said. “With regards to the U.S.-China climate accord, I see a great emphasis being placed on the reduction of emissions and the conservation of energy in 2020 as we work to create dining experiences within hotels worldwide. “Energy conservation will start to drive the hospitality industry in a direction that encourages more awareness of the problem and an adherence to practices that reduce the carbon footprint. As rooms have begun to implement automatic shutoff of lights and other technologies, the use of natural light in hotel restaurants will begin to reemerge in design. … “The shipping and freight industries will also be greatly affected, as designers will look to source products locally to cut down on costs. This, I think, will lead to a common practice of working with hand-crafted, and/or repurposed furniture, as well as locally-grown ingredients. With regards to textile and product manufacturing, laser and 3-D printing will open up new opportunities to create environmentally sound textiles and products that were unimaginable just a few years back.” CONTINUE READING ON PAGE 8
  7. 7. 8 CONTINUED FROM PAGE 7 “While it is difficult to know with certainty the hotel design trends we’ll see in 2020, I do expect technology to be a major influencer, and play a chief role, in the way trends are applied. As an example, with the evolution of technology, we saw flat- screen TVs replace traditional TVs in rooms virtually overnight. As a result, this singular piece of technology greatly changed the way we designers thought through layout of rooms, as we were able to eliminate larger pieces of furniture, such as armoires, and replace them with scaled down furniture. “Currently, a hot topic in hotel design is how to think about and factor in the traditional check-in desk in hotel lobby designs. Some properties have chosen to remove the check- in desk entirely, which impacts the way we play with space.” “With the rapid advancement of 3-D printing technology, we will start to see unimaginable possibilities in hotel design by the year 2020. Casegoods, upholstery and even electronics printed using this technology in the guestrooms will unleash exciting opportunities that will change the design process and the way we think. 3-D printing will continue to embrace the commitment to sustainability and will further push the entire industry forward.” CONTINUE READING ON PAGE 9 “Integration of the physical space with the digital world will be key in 2020. Some anticipated trends that we’re already starting to see take shape include: • Storytelling: The rules are changing. Design isn’t driven by the new ‘it’ color or motif. Brands today integrate storytelling into every aspect of the property, from the public spaces to the guest rooms. This will continue to be important moving forward. • The pressure on luxury: The select-service and mid-tier brands have stepped up their design in a huge way over the last decade, putting the pressure on luxury to differentiate itself in a new way. • The disappearing front desk: We’ll be seeing how brands
  8. 8. 9The 2020 Hotel Trend Report CONTINUED FROM PAGE 8 accommodate guests that want a human touch vs. those that want a tech-friendly check- in. • The changing guestroom desk: Guests want flexibility and multiple perch points to work everywhere—from the bed to a chaise lounge, or chair. • Evolution of F&B: This will continue to change, with more and more brands discontinuing or changing the traditional room service experience. For example, The Hotel Americano in New York offers five simple yet gourmet Bento Boxes for breakfast, lunch, and dinner that can be ordered on the in-room iPad. • The Chinese traveler: Brands will continue to design guest experiences around Chinese travelers - this will include all aspects, from technology to F&B offerings.” “Color: Color is cyclical, with fashion always leading the trend in forecasts. Shifts in color will include a focus of over-saturation of natural hues and a continued use of neutral tones such as modern greys, helping to create rich and inviting spaces. “Textureandpattern:Patternswillshiftfromthehighcontrasting graphics we see today to more visually soothing elements. Touchable textures will remain the most tactile element of any space adding warmth and comfort and will range from soft and rich wovens to heavy, luxurious velvets. “Design (‘The New Classic’): Abstracting traditional design elements with a ‘mash-up’ of more contemporary styles will help to create new and unexpected environments. Introducing surprise elements and whimsy, but not gimmicks, in each space continues to play a role in creating a memorable guest experience. Natural materials will continue to rule with the lines blurred between indoor and outdoor spaces. “Authentic experiences: Guests will continue to demand various amenities but will be more inclined to ‘experiencing’ versus ‘having.’ Sourcing local materials and finishes, using local artists and craftsmen and incorporating design elements from the local environment and culture will create an emotional tie between the guests and the community, its culture and its history.” UP NEXT: AN ANIMATED GUIDE TO THE FUTURE OF CHECK-IN
  9. 9. 10 AN ANIMATED GUIDE TO THE FUTURE OF CHECK-IN REPORT FROM THE U.S.—What will the hotel check-in process look like by the year 2020? Hotel News Now pulled information from industry sources to find the answer. While some of their predictions might be perceived as far-fetched, one thing is certain: Technology is likely to play a large role in the process. (Less human interaction is a likely offshoot.) Watch as Bill and Anne take you on an animated journey of the future of hotel check-in … By the HNN editorial staff UP NEXT: IN 2020, HOTEL BRANDING WILL … Click to view
  10. 10. 11The 2020 Hotel Trend Report IN 2020, HOTEL BRANDING WILL … One thing is certain: Hotel branding in 2020 will revolve around unique, customized experiences that will test the industry’s approach to consistency and flexibility. Several global hotel and branding experts were asked to complete this thought in 30 words or less: “In 2020, hotel branding will …” Following are responses we received: By Jeff Higley, Editorial Director Sajith Ansar, founder & CEO of Spice Holding Group, which includes Idea Spice, a Dubai-based branding company that helps homegrown brands compete and grow rapidly in emerging markets: “In 2020, hotel branding will revolve around unique and customized consumer engagements. It will not be about expressing luxury but about bespoke experiences.” CONTINUE READING ON PAGE 12
  11. 11. 12 CONTINUED FROM PAGE 11 Jonathan Tisch, chairman of Loews Hotels, which owns and/ or operates 23 hotels in the U.S. and Canada that thrive on having local flavor: “In 2020, hotel branding will need to be even more specific and transparent so as to effectively put forth or sell the promise and proposition of a flag. The well- educated and savvy traveler will have so many choices and will want to know that their expectations will be exceeded, or else they will look elsewhere.” Walter Isenberg, president and CEO of Sage Hospitality, which owns and/or operates more than 60 hotels in the U.S.: “In 2020, hotel branding will be incredibly creative. The new generation of traveler wants experiences and convenience. Brands will need to learn how to bend the rules to fit each guest.” Michael Levie, COO of CitizenM Hotels, an Amsterdam-based brand with seven properties open and a mission to bring affordable luxury to the masses: “In 2020, hotel branding will be as important as it is today—it might look and be achieved differently. Brand is more than just a name and a logo, or association with the big brands. Business segmentation will shift to channel source; ‘gross revenue’ will just be a figure, ‘net revenue’ the real game (difference is distribution cost, brand fees, online marketing and OTA commission); and brand service will need to be an ‘experience.” CONTINUE READING ON PAGE 13
  12. 12. 13The 2020 Hotel Trend Report CONTINUED FROM PAGE 12 Jim Holthouser, executive VP of global brands for Hilton Worldwide Holdings, which has 4,250 managed, franchised, owned and leased hotels and timeshare properties, with more than 700,000 rooms in 93 countries and territories in its portfolio: “In 2020, hotel branding will be defined less by the hotel’s physical brick and mortar and more by the consistent delivery of the brand’s iconography and culture.” Hamish Dodds, president and CEO at Hard Rock International, which has 21 hotels: “In 2020, hotel branding will be far more customized, and while hoteliers will continue to strive for a strong international presence, they must be aware of the challenges in ensuring the brand remains consistent across various markets, all the while respecting and acknowledging the local culture and interpretation of each destination.” UP NEXT: STR 2020 FORECAST
  13. 13. 14 STR 2020 FORECAST: SUPPLY TO STALL OCCUPANCY Rate and revenue per available room will have grown by leaps and bounds by 2020— but not occupancy. Occupancy levels should taper by 2020 thanks to pressure from occupancy ceilings and supply increases. Supply is expected to be just shy of 2 billion available roomnights, with demand nearing 1.3 billion roomnights. As a result, occupancy is estimated to be just less than 64%, close to its 2014 level. Our 2020 forecast anticipates average rate topping $150, a total increase of approximately 30% from its 2014 level. Revenue per available room is projected to surpass $96, a path fueled mainly by rate growth. Overall, we expect a compounded annual rate growth for RevPAR during this expansion period to be similar to what we saw in the 1990s. In the 98-month expansion ending in late-2001, RevPAR grew at an annual compounded rate of 4.8%. We have forecast an annual compounded growth rate of 4.9% for RevPAR for the 93 months beginning April 2013 through the end of 2020. This forecast assumes no major downturn brought about by a major unforeseen event or disaster, be it economic, political, natural, or otherwise. Rate should be up 30% in 2020 when compared to 2014 levels, though supply increases will keep occupancy at about the same level, according to STR Analytics. By Steve Hennis and Carter Wilson, STR Analytics CONTINUE TO VIEW CHART
  14. 14. 15The 2020 Hotel Trend Report UP NEXT: BOLD PREDICTIONS FROM HNN CONTINUED FROM PAGE 14 U.S.OCCUPANCY&AVERAGERATEPERFORMANCECYCLE 12MMA 1988-2020 $150 $140 $130 $120 $110 $100 $90 $80 $70 $60 $50 $40 50% 52% 54% 56% 58% 60% 62% 64% 66% OCCUPANCY 68% 93-Month RevPar Expansion 4.9% CAGR 98-Month RevPar Expansion 4.9% CAGR DEC 2015 DEC 2020 APRIL 2013 MAR 2001 FEB 1993 FEB1988 Source: STR
  15. 15. 16 BOLD PREDICTIONS FROM HNNBy the HNN editorial staff Predicting changes in the hotel industry is challenging under the best of circumstances—let alone under a five-year horizon. But that didn’t stop the Hotel News Now editorial team from giving it their best shot. Presented here—with a massive grain of salt—are HNN’s predictions for 2020 Click to view UP NEXT: PREDICTIONS FOR THE GUESTROOM OF THE FUTURE
  16. 16. 17The 2020 Hotel Trend Report 9 PREDICTIONS FOR THE GUESTROOM OF THE FUTUREBy the HNN editorial staff Guests will be able to control temperature and lighting from their tablet. There will no longer be desks in the room because millennial travelers are more likely to work while sitting in bed. Guests will have the ability to connect Bluetooth technology to the mirror in the guestroom’s bathroom in order to stream content. Speakers will be built in to the bathroom’s mirror. Hoteliers will respond to guests’ increasing awareness of wellness trends by implementing in-room fitness stations, which could include a yoga mat, exercise ball and weights. There will be no need for a chair and table due to the lack of roomservice at hotels. The guestroom closet will be deconstructed to make things more exposed. There is not a need to hide anything anymore. There will be more digital art in the rooms, possibly on the guestroom’s TV. It will allow for the ability to easily change the art and create an added punch of energy to the room. Guestrooms will have only hard surfaces for flooring because this it is perceived to be cleaner than carpet. So long, desks. Bye bye, bathtubs. The guestroom of the future might abandon these tried- and-true staples (and others) in favor of new space-conscious and tech-savvy upgrades. Sources: Sara Duffy, interiors associate, Stonehill & Taylor; Marriott’s #BrilliantGuestRoom design winners UP NEXT: ORDER UP! NEW ROOMSERVICE OPTIONS ON THE MENU
  17. 17. ORDER UP! NEW ROOMSERVICE OPTIONS ON THE MENU High costs and tightened guest schedules are prompting many hotel companies to change their traditional roomservice offerings. By Terence Baker, Reporter, Europe Vince Barrett, VP of food and beverage, New Castle Hotels & Resorts: “The traditional way we see roomservice will be a thing of the past for nearly all hotels, except maybe for very high-end, 5-star-plus hotels and resorts that want to offer it as a high-end service touch point.” Barrett believes that within the next couple of years the major chains will begin to roll out new in-room dining service standards. He thinks their visions will be similar in their modeling, but each will have their own sense of brand identity. CONTINUE READING ON PAGE 19 GLOBAL REPORT—Roomservice in 2020 will, according to sources, look quite different than it does today. An indication that huge changes were on their way came with the New York Hilton Midtown’s mid-2013 decision to discontinue traditional roomservice. In its stead came a grab-and-go food outlet that also did guestroom delivery not on white tablecloths but in paper bags. Some predict that in years to come only high-end hotels will continue to provide the type of roomservice that comes with real plates, tablecloths and portable tables orchestrated by dedicated in-room dining departments. HNN asked five hoteliers responsible for an array of product type on three continents to give their thoughts. This is what they said: 18
  18. 18. 19The 2020 Hotel Trend Report Barrett, who also is MD of New Castle’s purchasing subsidiary Provender LLC, added the brands’ mobile apps will have the capability to interface with a hotel’s point of sales system to provide numerous food-and-beverage options, as well as several delivery points. Hoteliers also will look to create retail style spaces within their lobbies that will act as a grab-and-go option, he said. Barrett does forecast one major difference. Barrett also foresees brands looking to have a tiered approach in regard to the final price paid for in-room dining, providing guests flexibility in when, how and what they want and how much it will cost them. CONTINUED FROM PAGE 18 Duncan Berry, chief executive, Choice Hotels Europe/United Kingdom: “By 2020, roomservice will still exist, but you’re likely to be greeted by a hologram and make all transactions via your smartphone and the next generation of Google Glass.” For chains with flags that cover several price points, roomservice will be tweaked, but it will tend to be reduced in scope across the border, according to Berry, who said that almost 50% of his hotels are limited service and therefore do not provide in-room dining, while the other half’s guests increasingly preferred items such as pizza, followed by other takeaway food that they also enjoy at home. “Hotels are providing locally-sourced menus, thereby encouraging (sustainability) and providing the cutlery, et cetera, for this at a small charge,” Berry said, equating the new trend to the practice of charging a small fee to open a bottle of wine if the restaurant in question does not have a liquor license. Berry also predicts flexible offering and grab-and-go options. “This,” he said, “we are seeing as becoming more of an expectation from our guests.” CONTINUE READING ON PAGE 20
  19. 19. 20 CONTINUED FROM PAGE 19 Maxine Taylor, executive VP of asset management, The Chartres Lodging Group: “I believe that we will continue the trend in moving away from traditional roomservice. Everyone knows the current roomservice models all operate at a loss and over the years have become a guest ‘dissatisfier’ based on long wait times coupled with exorbitant pricing and delivery fees. Right now, neither the guest nor the owner is satisfied. “It’s difficult to say how far technology will advance, with new and improved delivery and food production options coming out daily. … Roomservice and other core hotel department operations will continue to develop and test more creative food delivery systems. Just in the past several months, 3-D food printing has gotten a lot of attention. Right now, the technology seems to revolve around design with food, but who knows how this technology will evolve. It could be that food will actually be made in the guestroom using fresh ingredients. We simply don’t know where this might go, but it is certainly fun to imagine and discover new answers to age-old industry challenges. … (I) hope that by 2020 we will find the right balance for roomservice and land somewhere between full-service white linen and brown-bag delivery. Duncan Palmer, regional VP, Europe, Langham Hotels & Resorts and MD, The Langham, London, responsible for one of London’s most luxurious properties, said the key to roomservice in 2020 will be simplicity. “I do believe that clients will look for lighter and healthier options when dining by themselves in the comfort of their hotel room/suite. Very often, hotels make the mistake of having extensive roomservice menus. When combined with the distance from the kitchen to the guestroom, the meals sometimes end up mediocre in quality and very often, hot meals are served cold,” he added. But there is one thing Palmer never sees changing: “Quality, not quantity.” CONTINUE READING ON PAGE 21
  20. 20. 21The 2020 Hotel Trend Report CONTINUED FROM PAGE 20 Michael Heyward, director of hotel performance support Europe, InterContinental Hotels Group: “I think roomservice will be seen less and less. It used to be the case that a hotel room would have to provide something you would not have at home, but the lines between the two are getting blurred.” UP NEXT: 5 HR HURDLES (AND HOW TO PREPARE FOR THEM)
  21. 21. 22 5 HR HURDLES (AND HOW TO PREPARE FOR THEM) By Patrick Mayock, Editor-in-Chief HIGHLIGHTS• Millennials are looking for more than just monetary compensation. • Fostering diversity in the C-suite requires a long-term commitment. • Rising health care costs will remain a major challenge. The onslaught of challenges facing hotel human resource professionals shows no signs of abating in the coming years. Some of the challenges (e.g. labor relations, employee retention) are familiar. Others (e.g. legislation surrounding social media, sourcing skilled associates in emerging markets) are more recent. Others still might not even be on the radar. The common thread, if one exists, is the need for HR professionals to tackle each and every one, sources said. There’s no better time to prepare for tomorrow’s challenges than today. What follows is a list of HR-related hurdles that likely will dot the hotel runway by 2020—and suggestions for how best to start preparing for them. CONTINUE READING ON PAGE 23
  22. 22. 23The 2020 Hotel Trend Report Challenge: Retaining a fickly millennial workforce The cohort born between 1980 and 2000 often has been criticized as job hoppers whose personal ambition exceeds any semblance of employer loyalty. As they begin to comprise a larger share of the workforce, employers must find ways to retain them or risk costly increases in recruitment. Solution: Give them what they want (within reason) Chuck Conine of Hospitality HR Solutions (and an HNN columnist) said millennials want more than monetary compensation. Plentiful growth opportunities (both upward and cross discipline), great training, having their voices heard and robust health benefits all dot the list. They also want to know their efforts are contributing to a higher cause, he said. “Millennials are especially curious about the world around us. Their causes, generally speaking, are for improving that world. Things like sustainability are huge.” Challenge:‘Obamacare’&risinghealthcarecosts “The most obvious one is going to be health benefits,” said Melissa Silvers, principal with asset manager SCS Advisors, when asked what challenges HR professionals will face by year 2020. “Benefits over the past couple of years have really gone through the roof.” Solution:Shiftsomeofthecostburdentoemployees While not the ideal scenario, many hotel companies likely will be forced to increase out-of-pocket employee expenses to stay afloat, Silvers said. Others might offer tapered health plans as a means of controlling costs. “More brands are going to change to that because their hotels aren’t going to be able to stay in biz and produce a profit,” she explained. Challenge: Fostering diversity in the C-suite Though notable gains have been made, many still criticize the hotel industry’s C-suite of executives as an “old, white man’s club.” Hotel companies’ executive ranks must better reflect the increasingly diverse base of travelers they serve. Solution: Make a long-term commitment “Diversity is a not a check-the-box-and- you’re-finished task,” Conine said, pointing to the practice of placing a minority executive in a high-profile position. A better tactic, he said, was committing to diversity for the long term. “Investing in minority college programs, such as a local community college, hiring, training and promoting their graduates, for example, that makes an entirely different statement,” Conine said. “… The real players in our industry, both the players that have established themselves as committed and those who are coming online, realize it’s a long-term commitment to the community the hotel or resort serves so that the property reflects the diversity of that community.” Challenge: Sorting through social media LinkedIn was founded in 2002, Facebook in 2004 and Twitter in 2006. More than a decade later, hoteliers are still working around the legal pitfalls that abound when using these and other social media platforms whether recruiting, monitoring or employing in some other HR-related practices. Sue Sanders, senior VP and chief human resources officer at asset manager HVMG, said they’ll continue to work through those issues in the years ahead. CONTINUED FROM PAGE 22 CONTINUE READING ON PAGE 24
  23. 23. Solution: Stay abreast of employment law HR professionals should learn from others’ mistakes, Sanders said. The best way to do that is to keep abreast of employment law regarding social media in any number of academic journals, news outlets or HR blogs. Those lessons learned should be applied to hoteliers’ own HR practices, she said. Challenge: Accommodating a mobile workforce Though pushed to the forefront by millennials, the trend of associates calling for more flexible hours and terms of employment has permeated every generational cohort. Accommodating those needs is as much a retention play as it is one of productivity, as some employees (in applicable positions such as sales or IT) produce better work while working remotely, sources said. Solution: Don’t be afraid to extend the leash Work-from-home policies and flex time should beaddressedaswouldanyotheremployment policy, Silvers said. HR professionals should establish criteria for acceptable use of the practice and hold employees accountable to them. Sanders is hopeful technology might soon emerge (if it doesn’t exist already) to help managers track the productivity of their remote workforce. CONTINUED FROM PAGE 23 24 UP NEXT: CONSOLIDATION COOKING IN DISTRIBUTION SPACE
  24. 24. 25The 2020 Hotel Trend Report CONSOLIDATION COOKING IN DISTRIBUTION SPACEBy Alicia Hoisington, Managing Editor HIGHLIGHTS• Sources expect Google to enter the distribution mix. • OTAs will have to compete with online retailers. • Sales for private accommodations are predicted to be $1.6 billion in 2018 in the U.S., according to Euromonitor. REPORT FROM THE U.S.—Consolidation might well befall the online travel agencies, if not outright obsolescence. And the sharing economy is here to stay. Those are just two of the predictions for the distribution landscape in 2020, offered by industry experts. “Expedia and Priceline will retain their dominance, and it could be that Expedia outright acquires Travelocity,” Michelle Grant, travel and tourism research manager at Euromonitor International and an HNN columnist, wrote via email. However, she said the smaller online travel agencies will remain and fight for relevancy. Additionally, all players will look to increase supply beyond hotels, focusing on delivering ideal accommodations to customers. “I think we’ll see metasearch engines playing a larger role in accommodation bookings. While Google has yet to make significant waves in the distribution space, it could be that in the next five years the company refines its existing products and launches new ones that are ready for a significant marketing push, thus making it a significant player in the distribution space,” Grant added. “You’re starting to see it. It’s such a lucrative business, these OTAs, that everybody’s trying to jump in and find an angle,” said Bashar Wali, president of Provenance Hotels. “And we all know with the amount of information Google has on us as consumers, and the amount of money there is to be made in the OTA world, it would be shocking that Google doesn’t become a meaningful player in that world.” CONTINUE READING ON PAGE 26
  25. 25. And the competition won’t just come from the likes of Google, either. “OTAs will need to compete with generalist online retailers, such as Amazon and Alibaba, who will increasingly target the online travel category due to it representing a large share of total e-commerce sales,” Angelo Rossini, research analyst with Euromonitor International, wrote via email. Brian Tkac, senior VP of marketing and sales at Hostmark Hospitality Group, foresees fewer OTAs—as the channel is defined today—in the mix. “But there will always be third parties that will capture direct market share and take advantage of weak links in the distribution chain, similar to today’s meta aggregators,” he wrote via email. The sharing economy Sources said the sharing economy isn’t going anywhere. “The sharing economy will be more prevalent. We predict sales for private accommodation to be $1.6 billion in 2018 in the United States, up from $622 million in 2013,” Euromonitor’s Grant said. “Suffice it to say the way shoppers shop is changing every day. In the sharing economy, think about Uber for a minute and how that completely disrupted the whole model,” Wali said. “The traditional way of going on a site and looking at reviews and doing all that stuff, I see that becoming cumbersome for the millennials. It just takes too many steps. And I truly believe we’ll start seeing the Uber way being more common and relevant in our industry.” And what about hotels being listed on sharing-economy websites? “Airbnb has stated that it will be curating its supply, removing types of supply, such as hotels, from its listings to ensure that its marketplace meets its community’s expectations. It is unlikely that hotels will be able to leverage Airbnb in the future,” Grant said. “Will we ever be on the sharing economy? Will hotel rooms become part of Airbnb? I absolutely believe that will be the case. And I absolutely believe that the sharing economy is here to stay,” Wali said. “It may not be Airbnb … but I think there will be an Airbnb experience for hotels where you are—sort of like the airline model—buying based on demand, buying based on what somebody’s willing to sell a room for and kind of liberating the experience and making it really simple,” he added. CONTINUED FROM PAGE 25 26 UP NEXT: 3 MOBILE STATS YOU NEED TO KNOW
  26. 26. 27The 2020 Hotel Trend Report 3 MOBILE STATS YOU NEED TO KNOW global mobile subscriptions by 2019 (In Q1 2014, there were 6.8 billion.) Source: Ericsson Mobility Report June 2014 Source: Switchfly and Harris poll to 2,017 U.S. adults Source: Switchfly and Harris poll to 2,017 U.S. adults Americans will book travel on a smartphone in the year 2020. of millennials will book travel in 2020 using a smartphone. 3 MOBILE STATS YOU NEED TO KNOW UP NEXT: GLOBAL TRAVEL BY THE NUMBERS
  27. 27. 28 UNWTO: Tourism 2020 Vision GLOBAL TRAVEL BY THE NUMBERS Projected Market Share By Region In 2020 GLOBAL TRAVEL BY THE NUMBERS CONTINUE TO VIEW NEXT CHART
  28. 28. 29The 2020 Hotel Trend Report Projected Market Share By Region In 2020 SHARE OF WORLD BUSINESS TRAVEL SPENDING: DOMESTIC PLUS OUTBOUND INTERNATIONAL CONTINUE TO VIEW NEXT CHART CONTINUED FROM PAGE 28
  29. 29. CONTINUED FROM PAGE 29 30 SHARE OF WORLD BUSINESS TRAVEL SPENDING: DOMESTIC PLUS OUTBOUND INTERNATIONAL UP NEXT: PRECARIOUS PREDICTIONS FOR THE GLOBAL ECONOMY
  30. 30. 31The 2020 Hotel Trend Report PRECARIOUS PREDICTIONS FOR THE GLOBAL ECONOMYBy Shawn A. Turner, News Editor The hotel industry environment of 2020 will no doubt change during the next five years, but in some ways it will also stay the same, according to sources. The predictions for 2020 were varied among the four experts to whom Hotel News Now posed the question: “What will the macroeconomic environment look like for hotels in 2020?” Their responses ranged from the belief that disruptors such as sharing economy companies will continue to, well, disrupt the industry, to a significant increase in the amount of global tourism. Listed below are the thoughts HNN’s cadre of sources had on the subject. Feel free to chime in with your own thoughts in the comments section below. • The hotel business has always been an industry that has seen a lot of change. That’s still going to be the case five years from now. • The millennial traveler will continue to send shockwaves across the industry, and the hotels of five years from now will all feel like independents, even if they’re branded. “When someone is traveling to Nashville, they want to feel like they’re in Nashville,” he said. “When they’re going to L.A., they want to feel like they’re in L.A.” • Disruptors will continue to be a big factor in the industry during the next five years. • Without saying what the overall economic condition might be, Merkel said the industry appears poised to continue to be in a good position in 2020. CONTINUE READING ON PAGE 32
  31. 31. • International travel will be a big influence in 2020, Hartwich said. Developing nations will continue to develop, and outbound travel from these countries will continue to catch up to the United States. • It’s unclear what will happen with China. Some believe the country is on the verge of a real estate bubble that is about to pop. If that happens, it will have a major impact on international travel numbers in 2020. • He said it will be interesting to see what happens to Airbnb and other sharing economy companies during the next five years. “By then, we will have a great viewpoint on what that company means for the hotel industry, and I don’t think right now that anybody knows,” he said. • Echoing Merkel’s comments, Hartwich said there likely will be a proliferation of experiential hotels. “If you have a unique hotel with unique offerings, you can exercise pricing power,” he said. “With an average Courtyard, it’s harder to push rate too far from the competition.” CONTINUED FROM PAGE 31 • Millennials will be a key demographic in 2020. In the Americas, the Latin American traveler will be driving a lot of demand for hotels, Freitag said. • There will be many more “transparent travelers” in 2020. That is, those travelers who are willing to give up information about themselves in order to make travel easier. “TSA and Global Entry are the first signs of that,” he said. • Long-haul aircraft will continue to improve, and airlines will focus more on point-to-point markets, such as Southwest Airlines does with its model. The hub-and-spoke system will not be as big of a focus. • Using the term “downturn” to describe the hotel industry in 2020 might be a tad too strong, he said. “If there are no demand shocks, it’s going to be a soft landing,” he said. • Asia will continue to gather momentum, while there will be “pockets” of strength in Africa. Europe and America will be “cruising along” while Germany will be a “powerhouse.” 32
  32. 32. HOTEL NEWS NOW 18500 Lake Rd., Suite 310, Rocky River, Ohio 44116, USA Tel: +1 615-824-8664 FOLLOW HNN ON SHARE YOUR THOUGHTS ON THIS SPECIAL REPORT ON TWITTER #HOTELS2020 Scan to view report online INTERESTED IN SPONSORING FUTURE SPECIAL REPORTS? CONTACT Lynsie Bennett Director of Business Development (615) 824 8664 x3374 LBennett@hotelnewsnow.com Twitter: Lynsie_HNN_STR /HOTELNEWSNOW /HOTEL_NEWS_NOW Copyright 2014 STR, Inc. All Rights Reserved. illustrations: jon edwards

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