Even before the onset of the COVID-19 pandemic, travelers were demanding more unique, memorable experiences, and hotel industry leaders believe that's a hard thing to maintain as more companies cut back on the hotel operating model.
Speaking during the "Boardroom Outlook: The 'Experience' Factor Means Business" panel at the 2021 Americas Lodging Investment Summit, Kimpton Hotels CEO Mike DeFrino said as leisure demand spikes, driving up rates in some markets, customers are expecting the same, or better, service.
He noted there will be a "learning curve" for customers on what to expect during a hotel stay.
"The customer is not there yet is what I've found by talking to my general managers, especially if you're paying $500 or $600 in Key West and you don't have clean towels," he said. "You're miffed. And we've seen that reflected in our guest satisfaction scores, our TripAdvisor ratings and other things where people speak out. So there's an uphill battle ahead."
John Cohlan, CEO of Margaritaville Holdings, said there is simply too much demand to keep up with in certain markets, and it seems like guests can't be priced out of destinations to compensate.
"With there being so much leisure demand, we were actually trying to depress occupancy by raising rates," he said. "But because of what's going on in the market, that hasn't really worked very well. It's compounded the problem because you're now paying more and the services are not as responsive. That becomes a problem."
But as the traditional hotel operating model becomes more challenged, part of the solution is to move to more nontraditional models, panelists said.
Rafael Museri, CEO and co-founder of Selina, said guests at his properties in international resort destinations don't want to feel like tourists but want more of a connection to the destination and the people who live there.
"They really want to hang out and go out with the local cool people, so we're focusing on making that local community happy," he said.
Part of that effort is measuring the success of a stay at the property by the number of friendships formed.
"That's huge because we can see the immediate relationship with revenue," he said.
Ken Cruse, CEO and co-founder of Soul Community Planet, said that sometimes with unique initiatives like that, hotels have to be willing to take short-term losses or to swing and miss.
He said when his company decided to start offering rooms to disconnect from technology that didn't have a television or other electronics, it was poorly communicated to the guests in the early stages.
"Ultimately, guests will pay more for that experience as they value that time to be a little bit more mindful and a little bit more zen," he said. "But initially that idea wasn't marketed the right way. We didn't convey the idea correctly, so we'd have situations where guests would show up and say "Hey, where's my TV?'"
Jeff Wagoner, president and CEO of Hawaii-based Outrigger Hospitality Group, said programming correctly is becoming more important at resort properties.
"In our experience, for example, in Hawaii, live music is part of the culture," he said. "So developing that and curating that within each property is critically important to be able to develop the kind of experience you want."