Brands across the
hotel industry are racing to modernize their products and technology to stay
competitive. Yet, corporate travel buyers in BTN's 2016 Hotel Survey
rewarded brands that not only embraced modernity but also turned their
attention back to a bedrock principal of hospitality: service.
BTN's survey ranked brands across seven tiers. Of
last year's winners, only one brand returned to the top: Starwood Hotels &
Resorts' Westin brand, which this year shared the No. 1 spot in the
upper-upscale tier in a tie with Marriott International's flagship Marriott
brand.
For the third
consecutive year, Marriott International had the strongest performance among
multibrand hotel companies, as Ritz-Carlton, Marriott, Fairfield Inn and
Residence Inn ranked in the top three in their tiers. InterContinental Hotels
Group and Hilton Worldwide each had three brands finish in the top three of
their respective tiers, while Starwood, Hyatt Hotels Corp. and Best Western
Hotels & Resorts each had two.
Combining the
Present & the Past
High-speed Internet
has become table stakes for hoteliers, and it's showing in where the industry
is allocating its money. Bjorn Hanson, a clinical professor at the New York
University School of Professional Studies Tisch Center for Hospitality and
Tourism, said spending on Wi-Fi upgrades could prove to be one of the largest
capital expenditure costs for hotels in 2016. Top finishers Ritz-Carlton,
Crowne Plaza and Best Western mentioned Wi-Fi as a brand improvement or
emphasis during recent years.
An emerging theme
among many of the best-performing brands this year, though, was an increase in
service initiatives. Fairmont Hotels & Resorts, for instance, updated its
Service Promise training program, introduced in 2006, and required every
Fairmont colleague, from general managers to bell hops to kitchen staff, to go
through the program. Hilton's Homewood Suites, which came in second in the
upscale extended-stay segment, revamped its "I Am Sales" program,
which encourages every level of the hotel staff to feel like they're part of
the sales team and to be "outrageously pleasing our guests" or OPOG,
according to Adrian Kurre, global head for Homewood Suites and Home2Suites by
Hilton.
While these new
initiatives may seem like a return to the old way of doing business, they're
more a symptom of a world in which online reviews can make or break a brand. "When
you please a customer, you're encouraging them to talk about us on social media,
talk about us to their friends, to return to one of our hotels the next time
they have an opportunity," Kurre said.
Nikhil Nath, founder
and CEO of global hotel software management company Knowcross, said something
like a 1-point increase in a property's TripAdvisor score can lead to a
double-digit bump in revenue. That's high stakes indeed for an industry that's
on its way down from its peak in the current business cycle.
According to STR,
every chain scale segment, aside from independent hotels, saw a drop-off in
occupancy from January to July. Average daily rate is still growing between 1.8
percent and 3.6 percent, depending on the segment, but those declines in
occupancy, when taken with a supply growth rate of 1.5 percent that's outpacing
1.4 percent demand growth, indicate future weakness for hotels. For buyers,
that means more negotiating power in the seasons ahead than they've had in
recent years.
Methodology
For its annual Hotel Survey, BTN emailed
readers who are responsible for corporate hotel-buying decisions, and 316
participated in an online survey to rate the hotels with which they have
conducted business in the past year. They rated the brands on as many as 12
attributes on an ascending scale from one to six. BTN reported results
only for hotel tiers and brands with significant respondent usage. The survey
bases hotel-tier divisions on price-point data provided by STR Global and on
industry knowledge of how buyers relate with specific brands.