Hotel Data Conference ’22: Burning Questions Answered
This year’s Hotel Data Conference in Nashville was really something special. Maybe it was the novelty of meeting with our peers in the Country Music Hall of Fame, or maybe it was the fact that our industry is keenly aware of how lucky we are to be able to get together like this again… or maybe it was Adam Sacks taking the stage with his guitar and singing a “love letter to STR.”
Warm fuzzy feelings aside, HDC attendees had some burning questions asked and answered, including how technology – like the right RMS – can help alleviate economic pressures. (Book your demo of N2Pricing RMS today if you missed your chance at HDC.)
Read on to learn more about labor shortages, inflation, group, customer needs, and more.
What Makes You Queasy? Labor Shortages Are Taking a Toll
- Hoteliers continue to be short-staffed and stressed out: When asked “What makes you the most queasy?”, the #1 answer (34%) was industry labor shortages. Concerns over staffing challenges came in higher than both the heightened risk of a recession and group and business demand still falling short of pre-pandemic levels.
- Hospitality hit the hardest: While the hospitality industry isn’t the only one feeling the effects of the labor shortage, it has been especially slow to recover. Though the macroeconomic picture of the jobs market looks positive – overall unemployment rates have dropped to just 3.5% – our industry is still significantly below pre-pandemic staffing levels. Why? Because higher wages in other industries makes finding workers extremely challenging.
- Customer concerns are coming to a head: The labor shortage continues to have a major impact on the guest experience. During a great session, Erica Lipscomb of Crescent Hotels made the point that hotel guests have “given us a lot of grace” over the last two years. Labor shortages and supply chain issues have caused major disruptions in the guest experience. There was a willingness to accept that, for a time – but that time is coming to an end. If you are a full-service hotel charging full-service prices, guests are going to have full-service expectations. If those expectations can’t be met with reduced staffing levels, then you’re going to have a major problem.
- What can you do? Staffing up requires offering higher wages to compete with other industries, but simply absorbing higher labor costs is not an option for most hoteliers. One secret weapon? Technology that accounts for cost, measures price sensitivity and has profit optimization at its core. Learn more about how N2Pricing™ RMS can help prevent rising labor costs from crushing your bottom line.
How Scary is Inflation? What Are You Doing About It?
- Inflation continues to worry hoteliers: 11% of attendees said that inflation was the #1 thing making them queasy. While it’s clearly not the scariest monster in the closet – that’s labor – inflation continues to cause most hoteliers some real worry.
- Most are passing some costs to customers: When asked how much they are taking inflation into account when setting room rates, 79% of respondents said inflation is influencing their pricing, with 15% reporting inflation making a big impact on rate decisions.
- ADR is a little less shiny: While there has been considerable excitement about improved ADR, we can’t get ahead of ourselves; the increased ADR performance hasn’t kept up with inflation. There is a still a lot of work to be done to get back to pre-pandemic rates.
- Some positive signs on the horizon: We are seeing some encouraging signs when it comes to economic recovery. First, supply chain issues are showing signs of resolving. The cost of shipping is finally coming down, the unfilled goods numbers are starting to fall, and there isn’t the same backlog of container ships trying to unload that we’ve seen over the last 2 years. Wage growth also seems to have peaked. As a result, we expect CPI inflation to come down as well.
What Brings You the Most Peace? Several Positives to Focus On
While trends vary by market and hotel, there was wide agreement on several positive, interconnected trends.
- COVID eases, recovery strengthens: As COVID restrictions ease and normality returns, the hotel industry recovery continues to be positive.
- Group travel is coming back. Though it varies widely by market and some are seeing this increase more than others, there has been a general uptick in group and business travel. When HDC attendees were polled about what is bringing them the most peace right now, 28% of respondents said that the slow but steady increase of group and business travel is the #1 thing helping to ease their minds. (If group travel is part of your business mix, you need an RMS that produces group rate recs that optimize profit AND are quick and easy to understand – which is exactly what N2Pricing RMS does. Book a demo today to see the Group feature in action.)
- Leisure travel and pricing power remain strong: The leisure traveler has made a huge comeback. And hoteliers are feeling positive about their pricing power.
Are You Adapting to Meet the Moment?
Demand is picking up, but it looks very different than it did before the pandemic. Success in this new normal comes down to taking a hard look at your customer, and what the data reveals about their behavior patterns and needs, now. And then finding how you can uniquely deliver value with your current resources.
- Guest needs have shifted, and so have profit centers. Amenities that used to generate revenue, such as meeting spaces and catering, may no longer be profitable for some. Adaptability is the name of the game here – hoteliers must respond to these changes in customer behavior and identify other revenue streams to be successful.
- Seasonal demand patterns are changing. General seasonality has flattened a bit due to the new “work from anywhere” lifestyle. Hybrid work flexibility allows for travel at any time, and days that have historically seen low demand (Sundays and Thursdays) aren’t so bad anymore.
- Data is everything. In order to truly understand your customer, you have to dig into the data. And not just general industry data – your data, about your customer. What are the numbers telling you? What levers can you pull to meet guests where they are and capture more demand?
Looking Forward & Taking Action
Overall, the feeling at HDC was one of positivity and hope. There was a definite sense that the time for change is now, and an exploration of ways our industry can adapt and continue to recover. Rethinking our strategies and adopting the right technology will be critical to finding success in today’s environment.
Book a demo of N2Pricing RMS today to learn more about how maximizing profit and reclaiming your valuable time could be the unlock you’ve been looking for.