NEW YORK — Travelers during peak pandemic months were mostly accepting of necessary changes in hotels, such as reductions to food-and-beverage offerings, housekeeping services and other amenities. But now hoteliers must deal with guests who expect a return to normal, even if it’s not yet economically viable.
With average daily rates approaching or surpassing 2019 levels in many U.S. markets, guests have renewed expectations that hotel services and amenities are back in full, said speakers at the NYU International Hospitality Industry Investment Conference.
“It’s a really complex minefield for us to walk,” said Tony Capuano, CEO of Marriott International. “Guests are willing to pay [high rates], but their expectations are for the services and amenities they had prior to the pandemic. But our owners and franchisees have lost a lot in enterprise and asset values. We have to navigate this disconnect between customer expectations and the economic realities our owners are still facing.”
Demand and rate may have come back faster than operations can handle in some cases, speakers said.
“What guests expect now is radically different than what it was six months ago,” said Carlos Flores, president and CEO of Sonesta International Hotels Corp. “We had looked at our service offerings and operating standards and done things intentionally, like limit housekeeping. But now it’s a point of friction, with guests asking, ‘Why haven’t you come in and turned down the bed?’”
Jeff Wagoner, president and CEO of Outrigger Hospitality Group, said his company like others likely underestimated this return of guest expectations. Outrigger manages resort properties across Hawaii.
“We budgeted housekeeping at 70% [this year] because we thought consumers didn’t want it, then there was a 90% take rate,” he said. “Consumers are back, and they want those services, especially in a resort environment.”
Sloan Dean, CEO and president of third-party management company Remington Hotels, said fully opening back up helped head off the potential for negative feedback. Remington manages hotels for all major brand companies across the country.
“The pass we got last year with limited housekeeping and limited [food and beverage] is over,” he said. “If you’re not back to normal, you’re going to have very bad customer experiences.”
Meeting Expectations
Dean said amenities and food-and-beverage outlets at Remington’s hotels are open because “when someone is paying those prices, they expect a certain outcome.”
But some efficiencies, including mobile key, mobile food-and-beverage ordering and payment and switching some housekeeping services from full to “tidy” services instead can offset labor and operating cost pains.
Getting on top of what guests actually expect will be even more important as international travelers return to the U.S., speakers said.
“International travelers want a great bar experience in particular,” Dean said. “Often they stay and dine in the hotel, whereas domestic travelers often don’t. So we need our food-and-beverage really dialed in.”
Flores said communication around what services and amenities are offering will be especially important for those international travelers, who often stay longer and will need to know about dining options, laundry and more.
“More guests are doing their research on hotels than ever before, at your brand sites or other distribution chains, and you have to make sure you’re using those vehicles to talk about what people can expect on-property,” he said. “And finally, the check-in process is a wonderful opportunity to set expectations of what people’s stay will be like.”
New Opportunities
As hoteliers navigate the return of more typical leisure and business guests, they also may have new opportunities to cater to guests looking for different types of hotel experiences.
Executives touched on the fact that more mobile white-collar workers may have new abilities to work remotely, which can open up opportunities for hotels.
“Many companies are letting people work from wherever they want for a month, for example,” said Marriott International President Stephanie Linnartz. “That will open up new segments and new consumer behavior that will stick.”
Sébastien Bazin, president and CEO of Accor, reminded the audience that hotels can and should open up opportunities for people staying closer to home to socialize as the world opens back up.
“People have more ability to work at home or closer to home, yet they want to meet colleagues, have coffee or socialize,” he said. “We have hotel space! We’ve never catered to the local community successfully, and that’s wrong. We have so many people right next door. These people don’t need to book on Expedia. They know our properties and can be there. The hotel is a trendy and fun place to be for guests [and] for locals, and personnel will come back because they also want to be in a trendy place.”