TLDR: To Long Didn’t Read
This week's hospitality news includes hotel CEOs being happy with record ADRs and occupancies despite the new financial crisis, EU hoteliers being cautiously optimistic, and Latin America's overall recovery. Externalities impacting the hospitality sector include Brazil's deforestation project and Erdogan's new finance minister. The OECD has raised its forecast for global economic growth, and business leaders are revisiting China. Tips and tricks include travel marketing and making hotels stand out.
1. Main Hospitality News
Core news related to the industry
Travel CEOs are optimistic
The new financial crisis is stopping hotel openings, but it isn’t stopping hotel guests. With an average 2.5% growth in inventory down to 0.4% CEOs of various hotel companies are “happy” with record ADRs and occupancies and record low competition. Exciting if you believe that the financial crisis won’t show its ugly side. This positive sentiment is supported by Sebastien Bazin’s statements unravelled in a Skift podcast summarized here.
Hoteliers thinking about their future
Economics aside what do hoteliers think of their future? Specifically regular private hotel owners were asked that very set of questions and the results aren’t that surprising. EU hoteliers are “cautiously optimistic”. The main challenges are high energy costs, recruitment, retention and of course tricky economic conditions. Social media was the way to grow according to 31% of hoteliers (article on how to in “tips & tricks” & minimizing costs was the main goal across the board.
Latin America's performance in travel
EU & US are doing great, but what about the rest of the world? As seen in the last week’s post, 3rd world is recovering slower than 1st. Nonetheless, what about Latin America? Each country is doing overall well. Recovery is happening across the board, however, the reason why 3rd world is 3rd world is unfortunately still there. Political uncertainty in countries like Peru. Chile was impacted the most, apparently also due to a presidential election which decreased hotel demand. Nonetheless, all things end well and recovery is seen across the board. Life continues.
2. Externalities
Econimics, finance, geopolitics. All have an impact on the hospitality sector.
Brazil wants to cut forests to build roads
Brazil has decided to organize a major deforestation project to build a road through the whole of Amazon down to their neighbours Bolivia & Peru. This is causing a slight backlash amongst the Western media and locals as well. Indigenous people are even calling for genocide. This is similar to the project we saw in Peru, where a new railway was supposed to be built, which in turn caused outrage. Easy to sit on a high horse in the developed world and complain every time a poor country tries to build a road crucial for its future growth.
Erdogan is playing a new SimCity save
Erdogan has been elected and if you followed last week’s news, that meant according to our sources the end of hope for Turkey to join the developed world of democracies. Yet the current appointment of the finance minister shows that even authoritarian states can change (as long as the leader decides to do so). Basically, a new, more sustainable economic strategy will likely be taken by the new office, where endless borrowing won’t be an option anymore and a more sustainable spending strategy will be implemented. As always time will show, how that would turn out for the rest of the country.
OECD forecast growth
Another week, another forecast. This time OECD. The Organization for Economic Co-operation and Development (OECD) has provided a slightly more optimistic outlook for global economic growth, raising its forecast to 2.7% from 2.6%. The recovery is attributed to factors such as lower energy prices, improved supply chain conditions, and China's earlier reopening. However, challenges persist with higher interest rates and ongoing inflation, which may require further rate hikes by central banks. The OECD warns of remaining risks, including uncertainty surrounding Russia's aggression against Ukraine and potential changes in energy demand. Factors impacting the forecast all are an effect of whatever is going on in the world, not the cause.
Elon Musk and road trip to China
World business leaders are revisiting China. Elon Musk as well apparently. Why is this interesting? Well, they are doing it in “secret”. No PR announcements, campaigns or tweets from the CEO of Twitter. Why are they visiting? Business is booming again in China, money is flowing. Overall, western business wants to understand what are the rules of the game now and what to expect, hence the meeting with exclusive government officials.
3. Academia
Scientific papers related to the topics above. For those who want to know for sure ;)
Big Data in Hospitality (A Meta-study)
Imagine analysing 295 scientific articles on big data in the hospitality industry & then summarizing the findings. Well, you do not have to, since it has been recently done here. Unfortunately, the paper is behind a paywall, nonetheless, the abstract goes into proposals of what can be done in hospitality and how to train those who can do it.
4. Readables
Books, podcasts & the big stuff.
What to start a small business in the hospitality sector? Try out “The E Myth”. A book that goes into the basics of running a business at its core, including automating processes and extracting learnings from your team to avoid micromanagement.
5. Tips & Tricks Tools & SaaS
Any new software you can use? Industry tricks you missed?
What is the next big thing in travel marketing? The fight between advertisers & influencers of course. To find out more on how to get the attention of your potential guests, check out this article here.
How to make your hotel stand out? A recent article by hotel speak examines 5 examples of hotels in Romania here. In a nutshell, niche experience offerings like rural luxury tourism or an aristocrat-like stay.
Skift pulled a marketing stunt by offering short-term rental operators 5 things that they definitely need in their business. Turn out it's 2 summits organized by Skift, 2 reports & regular newsletter. Fair enough. Feel free to proceed here.
#10 - Hotel CEO's are optimistic about travel, the rest not so much!