HDC Day Two: Defining strategy and the best use of data
HDC Day Two: Defining strategy and the best use of data
17 AUGUST 2018 4:07 PM

Editors recap the second day of the 10th annual Hotel Data Conference with takeaways, quotables and more highlights from the event.

NASHVILLE, Tennessee—On the second day of the Hotel Data Conference, speakers gave insights into how strategies at their hotel companies are formed and the role data plays in decision-making.

The day’s sessions also included a detailed look at group business and a deeper analysis of hoteliers’ lack of pricing power, which has befuddled the industry in recent years.

More HDC coverage:

Video recap

Photo of the day

Elizabeth Parker, manager of strategic planning and insights for The Walt Disney Company, wins the Hotel News Now giveaway during Day Two of the 10th annual Hotel Day Conference. (Photo: Event Coverage Nashville)

Quotes of the day
“It’s total information overload today. Even the stuff you can call data is changing. You can call news data and data-mine the news, which is one of the big projects we’re working on.”
—Brenna Halliday, VP of strategic insight, Host Hotels & Resorts, speaking during the “An inside look at strategists’ insights” session.

“I think every company does need an overarching strategy that helps align the business with what its overarching goals are.”
—Stephanie Atiase, senior director of global corporate strategy, Hilton, speaking during the same session.

“Big Data is like sex—everyone is talking about it, but nobody really knows how to do it well.”
—Nikhil Bhalla, VP of finance, RLJ Lodging Trust, adapting a fun comparison during the “Analyzing the analytics profession” panel when asked about the challenges of harnessing a growing volume of data.

Slide of the day

In her general session presentation, “Hotel path to purchase: The complexity behind consumer choice,” Phocuswright’s SVP of Research Lorraine Sileo shared data on current hotel booking practices and where different channels overlap, depending on consumer behavior. This slide shows how travelers choosing home-rental sites like Airbnb are displaying booking behaviors that are looking more and more like traditional hotel stays.

Tweet of the day

Editors’ takeaways

On Day Two of the Hotel Data Conference, I heard at least three people describe themselves as “data geeks,” and this was before noon. So I would say Friday was a day for attendees to let their data geek flags fly. Speakers on the opening general session, “An inside look at strategists’ insights,” fielded question after question from an audience curious about learning more about how to grow as strategic leaders within their own organizations.

And the room was absolutely packed for the “Analyzing the analytics profession” breakout panel. While the conversation in that room covered everything from tools to techniques, most of the discussion centered on how to find and keep talented data and analytics scientists. “Make sure (your data analysts) are doing what they love to do,” advised Kathleen Cullen, SVP of revenue and distribution at Two Roads Hospitality. “Ensure they know how their work is being used and that there’s value in what they’re producing.”
—Stephanie Ricca, Editor-in-Chief

bounce back in group performance was one of the most prominent success stories across the publicly traded hotel companies in recent earnings calls, but a couple of panels during the final day of the Hotel Data Conference highlighted the fact that the long-term trends in that segment are still worrisome. It was specifically mentioned during the “Keeping pace with group business” panel that group roomnights sold are expected to dip in six of the next eight quarters, and group is a significantly smaller piece of the overall pie than it was a decade ago, dropping from roughly 40% of business to 30%.

There are various things playing into this, perhaps most notably that the strength in consumer confidence over the past decade was not matched by the considerably more tepid business confidence metrics. Many have pointed to corporate tax reforms and overall business confidence as the reason for the recent rebound. But, as panelists also noted, pending reductions in commissions for third-party intermediaries in the meetings space from InterContinental Hotels Group, Marriott International and Hilton have spurred many of those entities to push to book events well outside their normal booking window to lock in a higher commission rate.

If that reading of the tea leaves is correct, that means this short-term bump will be paired with a corresponding dip in the not-too-distant future, making the already dreary predictions for 2020 and beyond that much worse.
—Sean McCracken, News Editor

While hoteliers, developers and lenders await the end of the current cycle, there’s still much to be learned about how to make the most of the months and maybe years that are still left.

A constant theme of this year’s Hotel Data Conference is that the U.S. hotel industry continues to see record demand and high occupancy, but rate growth continues to lag behind. During a Data Dive presentation on Day Two, STR’s Carter Wilson and CBRE’s Jack Corgel called this “the rate paradox.”

Across chain scales, markets and hotel types, the constant is this paradox is affecting many high-occupancy hotels; few properties that are averaging more than 80% occupancy have shown an “immunity” to middling rate growth, Wilson said. It’s a puzzling paradox that seems to be endemic across all segments since 2014.

One other observation really struck me during Wilson’s and Corgel’s presentation: New-supply hotels built in this cycle have had a much harder time growing rate once they open than they did in previous cycles. Wilson noted that today’s new supply of upper-midscale and midscale hotels is similar to the property types that were built in the mid-2000s, and thus they’re having trouble dramatically growing rate right out of the gate.

Perhaps it’s statistical evidence of hotel brand proliferation, consumers shopping around on OTAs for better hotel prices, the power of reviews on TripAdvisor or the sharing economy undercutting the pricing power of hotel revenue managers. Can hotels adjust before the downturn?
—Dan Kubacki, Production Editor

One takeaway from Day 2 was from a panel of hotel company strategists, who gave their insights into how to best execute forward-thinking strategies. Most agreed it’s crucial to create an overarching plan with sub-strategies. About 63% of attendees who participated in a poll said their companies could use some help with this topic.

But let’s take a step back—what exactly does strategy encompass? Sam Makani, VP of portfolio strategy and reporting at Solid Rock Asset Management, said he views it as two components—decision-making and resource allocation.

Sue Sanders, SVP of strategic planning and chief human resources officer at Hospitality Ventures Management Group, said first and foremost a strategy plan needs to be simple enough to fit on one piece of paper. That’s a great way for hoteliers to visualize how important it is to make the plan simple, but effective. And aligning those actions on paper, day in and day out, really needs to involve everyone in an organization.
—Dana Miller, Associate Editor

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