From big data to Airbnb, this yearâ€™s lodging investment summit in Los Angeles showed forward-thinking concepts can have major return.
Of course, everyone heads to Americas Lodging Investment Summit (ALIS) with money on her or his mind. But this yearâ€™s conference, held Jan. 23-25 at the JW Marriott and Microsoft Theater at L.A. LIVE, was as much about tomorrowâ€™s trends as last yearâ€™s numbers.
Several sessions touched on the evolution of data collection and its possible implications on the guest experience. Responsive robots, including a replica R2D2, roamed the ballroom corridors. Innovative and reimagined hospitality modelsâ€”from the evolution of what it means to be boutique, to flipping existing apartment buildings into pop-up luxury hotels, to new brand incubator conceptsâ€”were at the forefront of the three-day summitâ€™s hot topics. And while most speakers prefaced with â€œpolitics aside,â€ many noted they were â€œcautiously optimisticâ€ about the Trump administrationâ€™s impact on the U.S. economy and what it will mean for the travel industry.
Here a few takeaways from the conferenceâ€™s roster of panels:
Big data may have a big impact: â€œYou already have the dataâ€”your guests are giving it to youâ€”youâ€™re just not using it,â€ said James Whittaker, Microsoftâ€™s â€œdistinguished technical evangelist,â€ during a TED-style talk in the Microsoft Theater. With the World Wide Webâ€™s migration to â€œthe Cloud,â€ data that was once scattered can now be organized. This is why machines, such as self-driving cars, are smarter than ever, noted Whittaker.
What does this mean for hoteliers? Well first off, they need to leverage their social media in a new way. Whittaker said intent to travel starts on platforms like Facebook and Twitter and operators shouldnâ€™t wait for guests to download a brandâ€™s app or find the hotelâ€™s website. Instead, he suggests they use data to find out who is looking for properties like theirsâ€”as well as gauge upcoming guestsâ€™ preferences.
In an earlier session the same day, Christine Warner, Facebookâ€™s U.S. head of industry, travel, said the guest experience starts 43 days prior to arrival and that in that time, customers are spending more time on Facebook than any travel site. She suggested using digital platforms like Messenger to connect with guests before their stay. However, if that information doesnâ€™t make it from marketing to the front desk to housekeeping, itâ€™s pretty much useless, noted Alexander Shashou, president/co-founder of ALICE-App, a hotel operations platform.
But how will leveraging data impact design? Ideally, it will make it more functional. Micah Green, president and ceo of Maidbot and 2015 graduate of Cornell University, is launching a robot that he believes will revolutionize how we clean. (I think it may alter hospitality designersâ€™ approach to interiors, as well.) In addition to upping efficiency, consistency and safety for housekeeping, his companyâ€™s Rosie robot also collects data while she sweeps. She can detect where Wi-Fi is weak, areas that are at risk of mold growth and even what type of fluid was the culprit for that questionable floor stain. But this data could also be leveraged to recognize drawers that arenâ€™t being used, where different types of guests drop their bags and which bath fixtures arenâ€™t working. With time, data collection from in-room robots could be a designerâ€™s go-to when determining project layouts, furniture placements and even sourcing products. (Side note: Rosie is about the size of a Roomba and half as loud as the average vacuum.)
Seeing is believing: ALIS devoted a whole panel to the tools and applications associated with virtual reality (VR). In the age of user-generated content and guest reviews, the worst thing an hotelier can do is attempt to hide flaws.
Dorothy Dowling, chief marketing officer of Best Western Hotels & Resorts, said customers want to see professional and user-generated content together. She views VR as a natural evolution of 360 tours, and noted that Best Western has been an early adopter of the technology. Having invested $2 billion in the guest experience, the brandâ€™s need to convey its product improvement to potential guests is crucial.
Of course, the increased prevalence of VR marketing ups the ante for designers, too. Cluttered layouts, forgotten ceilings and anything else that may have been concealed with traditional photography are not only an on-site turn off, but reservation deal breakers.
Dowling added that an unexpected benefit of VR has been the B2B effect: Buyers can now see their investments and experience the product without traveling to the location. Greg Jones, director, AR/VR for Google Inc., pointed out that VR is also having a huge impact on design and architectureâ€”a trend the hospitality interior design industry has already seen with the implementation of VR models within their own firms and the rise of creative communications studios such as SONNY+ASH.
If youâ€™re not paying attention to Airbnb, you might be in denial: â€œI instinctively feel Airbnb is a real threat,â€ boutique hotel pioneer Ian Schrager, chairman and ceo of his eponymous company, said in an on-stage Q+A shortly after receiving the ISHC Pioneer Award. He likens Airbnbâ€™s impact on hospitality to Uberâ€™s effect on the cab industry.
In a session the previous day, Brenna Halliday, vice president, strategic analysis for Host Hotels & Resorts, shared a different perspective, noting that hospitality professionals once viewed teleconferences as the possible end to business travel. While she admitted the industry â€œhas been slow to respond to travelers shifting preferences,â€ she noted demand is higher than ever and that Hostâ€”whose average traveler stays two nights opposed to Airbnbâ€™s seven-night guestâ€”isnâ€™t feeling an impact from the platform.
But the expansion of the online homestay network has been significantâ€”and rapid. Last year the company generated a whopping $6.8 billion in revenue (in 2015 that number was $2.7 billion), according to the aforementioned session, which included Halliday as well as panelists from CBRE Hotels Research, Vornado Realty, Two Roads Hospitality and Airdna, an independent Airbnb data and analytics company. From 2015 to 2016, Airbnb had significant growth across the board, from a total supply of 37,344,113 to 81,037,452; demand of 17,988,315 to 39,836,147; occupancy of 48.2 percent to 49.2 percent; and RevPAR of $73.17 to $83.55 (the latter is a growth rate of 14.2 percent).
Forget old money; millennials are the new luxury traveler: Gen Y is getting a little older, and gaining a lot more spending power. â€œMillennials are now the luxury travelers,â€ stated Adam Weissenberg, partner, Deloitte, who moderated another Boardroom Broadcast. Langham Hospitality Group ceo Robert Warman added that the industry used to think of millennials as post grads, but many of them visited luxury hotels growing up.
However, those born between the early 1980s and late 90s tend to jump in and out of the luxury segment. Theyâ€™re also less loyal to brands, and crave escape from touristy settings and immersion into the local community, added Chris Cahill, ceo luxury brands for AccorHotels. Trump Hotel Group ceo Eric Danziger noted that the purpose of his employerâ€™s latest brand, Scion, is to grab the luxury traveler earlier.
Looking ahead, major hoteliers will continue their global expansion. (Well, most of them.): While there has been a deceleration of RevPAR growth since late 2015, Mike Barnello, president and ceo of LaSalle Hotel Properties, said he feels there is currently an uptick in overall sentiment. In a different session, Jim Amorsia, ceo of G6 Hospitality, said â€œthings have gone back upâ€ following the U.S. presidential election.
Many speakers throughout the conference expressed feelings of â€œcautious optimismâ€ with hopes that with increased inflation and decreases in taxes people will be spending more. Barnello noted that from a travel perspective, many want a weaker dollar.
Boutique Design also hosted a buzzing Drinks by Design cocktail party celebrating the fifth edition of the upcoming BDwest at Upstairs, the rooftop bar at Ace Hotel Downtown Los Angeles, in conjunction with ALIS. Speaking of BDwest, for more forward-thinking ideas on the future of hotel design, be sure to join us for the two-day trade fair and conference, to take place Wednesday and Thursday, April 5-6, at the Los Angeles Convention Center.