As the volume of hotel brands continues to grow, there’s more work to be done to differentiate them from competitors and truly deliver what guests today and in the future want, speakers said at a recent conference.
LONDON—In today’s increasingly competitive market, branded hotels have a lot they need to deliver.
A branded hotel has to be viewed by its target customers as distinctive; it needs to deliver an experience that exceeds the wants and needs of its target guest for any specific purpose of travel; and it needs to be better than any competition that’s similarly priced and located, according to sources.
They are also about the small details, but even that has changed of late, according to John Rogers, SVP of brands and franchise operations, Europe, Middle East and Africa at Hilton, speaking on a panel titled “Hotel brand of the future” at the recent Hotel Distribution Event.
Some panelists felt current hotel brands still have a lot to do to be relevant for the guest of today.
Those changes included both physical and distribution considerations.
“You will have a photo of your family beside your bed because you have downloaded it to the Hilton site,” Rogers said, “but the days of using guest information, willingly given or overtly gained, to bombard guests with offers and other information is, in my opinion, over.
“Guests increasingly will construct the hotel experience around their wants, and that is only going one way, (but) asking them what they want and giving it to them is 10 years out of date.”
Ultimately, though, the branded hotel of the future retains much of the past.
“Bricks and mortar, running hotels well, making them fun and treating staff well—these are still the things to deliver,” said Patrick Reardon, executive chairman of ReardonSmith Architects.
Differentiation and legitimacy are critical
Reardon said he’s counted 101 brands among the top five or six hotel chains.
“How does that work? How can you get brand differentiation with 101 brands? The brand of the future might (as) well be no brand, as they seem to multiply exponentially every week. I do not understand that?” Reardon said.
James Woudhuysen, visiting professor, forecasting and innovation at London South Bank University, said the current frenzy behind branding often overshadows important parts of the hotel experience that may be lost, such as a good night’s sleep.
Panelists debated whether there are too many brands, or if brands ultimately will drive the industry’s future growth.
Reardon said he preferred “blackout curtains, beds and baths, not brands,” while James Lemon, COO of property management company Hostmaker, said “legitimacy is what is driving the brands, as the legacy ones are no longer appealing.
“But Airbnb is tangible proof that people are willing to trust an alternative,” Lemon said.
Online-travel-agency trends are not conclusive as to whether branded hotels are winning or not, panelists said.
“Ninety-five percent of Expedia users do not book a hotel because of the brand,” Reardon said, while Rogers replied that “only 50% of our guests come via OTAs.”
“If all cars looked the same, would you pay more for one than another?” Reardon asked.
“Brands will become more suspect,” Woudhuysen said. “As with air travel, the basics increasingly are not being delivered. There is pressure for more brands from the supply side, but consumers will be less and less fooled.
“Everything is moving from the service economy to the experience economy.”
IHG’s Rogers agreed.
“Friends at dinner parties are more likely to talk about that wonderful adventure they had to India last year than they are to talk about their car, and a lot of the move into new brands is to play into these new experiences of guests,” he said. “Brands are redeploying investment from things that guests no longer care about to things they do.”
Reardon wondered if the move to providing more experiences really was a groundbreaking move, the one the industry might really need to move on in the next era.
“The last radical change, and I mean radical, was providing accommodation with one bathroom and one bed in the same room,” Reardon said.
Panelists talked about some concrete changes hotels must make to continue getting ready for the future, and part of that means dealing with aging guests.
“Another thing missing from the discussion is hygiene for an aging population. … As long as I can differentiate the small writing on the bottle of shampoo from the small writing on the conditioner, I’ll be OK, as so far you cannot make electronic shampoo,” Woudhuysen said. “We need more of what Frank Zappa called his music, that is, ‘product.’”
He added he was concerned about the urge to add more social media, iPhone connectivity and what he called “other mechanism-zapping millennial (BS).”
“The brand of the future will have to take account of things like guests with arthritis and bad eyesight from too much mobile use. We have to teach staff how to treat older people, because at the moment they are doing a pretty bad job,” Woudhuysen said.
But Woudhuysen said he saw one piece of recent news that encouraged him.
“When (Jeff) Bezos raises Amazon wages from nothing to pitiful, then something is happening. We have to incentivize staff with better wages and better training, as that is one direct route to brand legitimacy,” he added.