HB ON THE SCENE: Brand Consolidation, Technology Remain Key Issues

PHOENIX—Industry executives joined Simon Turner, managing director of Alpha Lodging Partners, on the main stage at The Lodging Conference to discuss how brand consolidation, technology and Airbnb are impacting the lodging industry.

Is There Room on the Shelf?
Not surprisingly, brand consolidation, a topic discussed yesterday at length, returned to The Lodging Conference on day three. “Don’t underestimate the value and the opportunity for organizations to get shelf space,” said Greg Mount, president and CEO of RLH Corporation. “Just because you’re the biggest out there, doesn’t guarantee you shelf space. Shelf space is where it’s going to be going forward and understanding how to use it.” The latter is what’s key to successful acquisitions, no matter the size.

“Google has 90% of the search traffic in the world,” he said. “To put that into perspective: If Google wants to put you out of business, they can, so as big as some of these acquisitions have been, it’s still about understanding how to leverage that and where those consumers are going.”

Ken Greene, president, Americas, Radisson Hotel Group, noted the importance of a business being able to scale, but also pointed out the following: Sometimes too much scale isn’t good.

“I think a brand in every shelf is important,” he said. “I think having a lot of brands on that same shelf under the same family of brands becomes problematic.”

Speaking on behalf of his members, with regard to brand consolidation, HP Patel, chairman of AAHOA, said, “For members, the main thing is the ROI.”

What’s Technology’s Role?
Without the right people in the industry, technology is ineffective; however, technology can play an important role within the industry  if properties learn to use it to generate ROI.

A concern among owners, according to Patel, is bandwidth. “Technology is the way of the future,” he said. “We have to invest in technology, especially with labor costs rising so much.” If a property is unable to sustain infrastructure costs, however, issues, of course, arise.

“The great thing about franchisees is that they’re entrepreneurs,” Greene said. “They just think so much differently from corporate people, and they take a really good idea, and they’ll make it into a fantastic idea.”

With regard to how hospitality groups are treating owners, Magnuson has its own perspective: “We will never impose costs on our franchises from a technology perspective,” said Thomas Magnuson, CEO and co-founder of Magnuson Hotels.

From an association perspective, AAHOA wants to make sure Airbnb is competing on the same level playing field as hoteliers. “As hoteliers, we’re regulated,” Patel said.