My top takeaways from the NYU Hospitality Investment Conference
In some ways, it felt like déjà vu - but there are significant opportunities ahead
This week was the NYU International Hospitality Industry Investment Conference in New York City. In some ways, it felt like déjà vu from last year (“we’re cautiously optimistic”) but a number of things caught my attention that are relevant to anyone working in or around the hospitality industry.
Hospitality is the place to be - both in the short and long-term
Panelists spoke to both factors that make this industry attractive in the short term (supply constraints, consumer willingness to splurge on travel, group business returning) and the long term (the rise of the global middle class).
“Ask yourself: Do you believe in the long-term potential of travel? We do,” said Mit Shah, CEO of Noble Investment Group. “The long-term opportunity is the tailwind of demand coming in the decades ahead.”
Mit Shah, CEO, Noble Investment Group / Credit: Josiah Mackenzie, Hospitality Daily
While the media has been obsessed with speculating on a recession for what seems like forever, “It doesn’t really matter to us if there’s a recession or not,” said Eric Resnick, CEO of KSL Capital Partners.
Eric Resnick, CEO, KSL Capital Partners / Credit: Josiah Mackenzie, Hospitality Daily
Sloan Dean, CEO of Remington Hospitality, made the case for the change in consumer spending patterns being permanent. “The Great Depression changed our grandparent’s psyche. In the same way, Covid will drive lasting change for millennials in what they value.”
Sloan Dean, CEO, Remington Hospitality / Credit: Josiah Mackenzie, Hospitality Daily
For me, it’s important for everyone to hear about the potential in hospitality - not just the executives and investors at this conference. We all need to understand the reasons to be optimistic about a bright future for the industry if we’re going to invest our careers here, build cool stuff, and recruit people to join us.
A need to focus on providing value
“I want to be treated very well since I’m paying more,” is a common sentiment Unifocus CEO Moneesh Arora is hearing from travelers today.
Moneesh Arora, CEO, Unifocus / Credit: Josiah Mackenzie, Hospitality Daily
This is why designing and delivering an experience that guests feel is valuable is more important than ever.
“I’ve never heard someone complaining about price when they’re feeling they’re getting value back,” said Hilton SVP of Finance Clint Woodlock.
As Samantha Hardcastle has shown us, this is why designing experiences matters - but there are also investments to be made in buildings and properties themselves.
Now is the time to invest in product
“We need to keep our assets up to meet guest expectations,” said Marriott CFO Lonny Oberg. According to her, investments in product are paying off for investors already. “They are providing as strong an ROI as we’ve seen in years.”
Lonny Oberg, CFO, Marriott / Credit: Josiah Mackenzie, Hospitality Daily
Deutsche Hospitality CEO Oliver Bonke urged people to think about how we’ll look back on these boom times for hospitality and what we did to build enduring advantages.
Optimize before restaffing
Over 80% of hotels are experiencing staffing shortages today, according to new data from AHLA this week, but hospitality leaders should use this moment to be strategic.
“There’s a tendency to add staff without looking at optimizing current workflows,” said Moneesh Arora. Panelists said that needs to change.
“There are fundamental changes in operations that are serving durable and enduring purposes. Staffing can and should look different moving forward,” said Hyatt CEO Mark Hoplamazian.
Mark Hoplamazian, CEO, Hyatt / Credit: Josiah Mackenzie, Hospitality Daily
AI dominated tech talk
Panelists were eager to talk about how they are and have been using AI for years now. “We're using AI in pricing and revenue. We're using it in sustainability,” said IHG CEO Keith Barr - something echoed by many others.
What’s newer of course is generative AI, and Outrigger CEO Jeff Wagoner shared an opportunity I’m not hearing many others talk about. “There’s a seeding of AI technology that needs to happen. It can be a lot of work but can also be an opportunity to provide your guests with differentiated content.”
Jeff Wagoner, CEO, Outrigger Hospitality Group / Credit: Josiah Mackenzie, Hospitality Daily
Travelsify CEO Bruno Chauvat said something on this I’ve been thinking about a lot since:
In a world powered by AI, trust is the new currency.
Revenue and operations software are top tech focus areas.
Listening between the lines across panels on “jobs to be done” for technology showed the opportunity for smart revenue management and operations technology. PwC research confirmed this:
“The top technology investment opportunities from brands are in revenue management, property management, and reservations.”
Rajeet Mohan, Principal, PwC / Credit: Josiah Mackenzie, Hospitality Daily
Guest-facing technology opportunities in the booking and post-stay experience
"A robot will never welcome anyone to an Accor hotel,” said Accor CEO Sebastien said. “Anything before the stay or after the stay should be tech-driven. Anything during the stay should not be led by tech.”
Sébastien Bazin, CEO, Accor / Credit: Josiah Mackenzie, Hospitality Daily
ROI of tech seems less important than before
I’ve spent most of my career working in hotel technology and noticed a change in sentiment from owners and operators in this area.
“The ROI of technology isn’t always obvious but if you don’t invest, it will cost you a bucketload to solve the problems that come up,” said Crestline Hotels CFO Ed Hogansen. “If you’re a brand and don’t invest you’ll be behind and at a competitive disadvantage.”
Panelists paid lip service to the importance of people in hospitality, but few shared meaningful things they are doing to show that their people matter. I was disappointed by people too often framed adversarially as “labor” instead of the assets they are.
Omni Hotels & Resorts Chairman Peter Strebel is one of the people leading change here, addressing issues like affordable housing for staff. “We’re now in the associate housing business,” he said - developing 3 new buildings around their resorts and buying motels and other buildings to house staff.
Peter Strebel, Chairman, Omni Hotels & Resorts / Credit: Josiah Mackenzie, Hospitality Daily
Brand matters for recruiting
The solution for the labor challenge is having a strong employer brand reputation, James Bermingham said. “Richard Branson has been doing that for 50 years, and it’s continued to work for us.”
James Bermingham, CEO, Virgin Hotels / Credit: Josiah Mackenzie, Hospitality Daily
An opportunity to stand out in a sea of similarity
Overall, one of my biggest takeaways was how similar most people sounded. It’s why people like Richard Garcia at Remington Hospitality innovating beverage and food or Craig Poole taking a radically different approach to people stand out so much to me.
It’s what motivates me to stay on the hunt for the most interesting people building the most interesting things and sharing them with you here on Hospitality Daily and on the podcast.
The opportunity for you to stand out from everyone else seems higher than it’s ever been.
Hats off to everyone who is building interesting things and inspiring us all. We are working in an incredible industry and it’s time to take advantage of the opportunities ahead of us.