Event Recap: NYU Hospitality Investment Conference

Josiah: We just wrapped up the 2023 edition of the NYU Hospitality Industry Investment Conference and wanted to share just a couple of things that were top of mind. In case you weren't able to make the show, or if you did make it and weren't able to attend most of the sessions.

I think the first thing that struck me was it felt a little bit like deja vu from last year. There's a lot of talk about some of the tailwinds behind the industry of hospitality and travel, both in the short term people feeling like they want to get out there, coming out of COVID, and wanting to spend their money on experiences instead of hard goods. That is something that continued this year. There's a lot of optimism both for the short term and the long term. I think that's important as we think about building things in this industry, as we think about our own careers, the potential and the opportunity here is significant in the short term coming out of COVID, consumers wanting to spend more on experiences. But longer term, there's a lot of demographic trends that point to more opportunity. This was talked about again and again. I think, as we look at this year and next, inbound travel to the US from countries like China is expected to continue. Group business is expected to continue. And then longer-term demographics as millennials get older, wanting to spend more on hospitality, on experiences, seem like a court trend to watch here. So a lot of optimism in that regard. Eric Resnick, the CEO of KSL Capital Partners, said it doesn't really matter if there's a recession or not. He's very bullish, as we're almost everyone there at the event, in terms of the short and long term prospects of hospitality. Another thing that I was tracking was a focus on providing value. So just because there's demand there doesn't mean that we can be complacent. And Monish Arora, the CEO of Unifocus, which provides guests and employee satisfaction software, in talking with his clients, there's this common sentiment of as travelers, we want to be treated very well because we're paying more right, so our expectations are higher as well And we can't just use excuses of we're dealing with COVID and all of that We have higher expectations as travelers, right, so we need to provide value. Clint Woodlock, the SVP of Finance for the Americas at Hilton, talked a little bit about high prices, but he said I've never heard someone complaining about price when they feel like they're getting value back. So really important to provide value. On this podcast, we've talked about creating experiences. That's really important, but another way to do that is investing in the product itself the physical asset, the infrastructure, the design, And so another theme was now really being the time to invest in product. Oliver Bonke, the CEO of Deutsche Hospitality, spoke to this specifically and said we have an opportunity to be surgical across segments and create products and experiences that deeply resonate and create genuine value for travelers and other stakeholders. Right, and that's what's going to allow us to maintain premium pricing in this environment and moving forward. What's interesting to hear is that investments in product are already paying off, and Lani Orberg, the CFO at Marriott, said that she's seeing an impact of investment in assets and a strong ROI from that, as they seen in years. So it's really important to keep the physical assets, the product, up to a level that meets these increased guest expectations. Another theme was strategizing before restaffing A shortage of workers in the industry was brought up as a continued theme, but this could also be a moment to think about, okay, what changes need to be made before rehiring, to think about what are the right people and what would be the best roles for those people. CEO of Hyatt said we really need to think about what restaffing looks like. There have been fundamental changes in operations that are proving durable and enduring, and so staffing can and should look different. Monish Arora of Unifocus said there's a tendency to add staff without looking at current staff and workflow and think about where we can optimize that. So, as we're thinking about hiring people back into the industry, let's maybe use this moment to think about what is the best focus for them. What would be the best workflows to get the best results? Probably unsurprisingly, AI dominated Tech Talk And people like Keith Barr at IHG said that they're using AI and pricing and revenue. Of course that's been going on for some time. They're using it in sustainability more and more, so I heard that from many people. Jeff Wagener, the CEO at Outrigger Hospitality Group, had maybe one of the more interesting takes in saying that the seeding of AI providing this training data needs to happen. We've seen Skift in the hospitality media space do this with their content, and I think for hotel brands and operators, this could be an opportunity as well. Something else here Bruno Chavat, the CEO of TravelSpy, said that in a world powered by AI, trust is the new currency. So trust being a currency in this AI-dominated world, something to think about. How do you create trust with your customers, with your partners? I think, though, listening between the lines of everything that was talked about in this conference, there's really an opportunity for smart revenue management and operations technology, and Rajit Mohan of PWC confirmed this with some research that they did around, the top investment opportunities for brands being in revenue management, property management and reservations, so core areas to look at for innovation. That's where hotel operators and owners are investing. In terms of guest facing technology, there was a consensus that this should be focused on the pre-stay, the booking process and the post-stay experience. Accor's CEO talked about a robot will never welcome anyone at an Accor hotel, and he said anything before the stay and after the stay should be tech-driven. It's fair game, but anything during the stay should not be led by tech. So that's a theme that I've heard in conversations, interviews I've done for this podcast and seemed like the biggest areas for automation, for AI, back-of-house processes, making staff more efficient, but not necessarily interacting with guests. I've spent most of my career working in hotel tech and an interesting theme as well was RY on tech being a little bit less important than I've heard in the past. So I heard from people like Ed Hogan. The CFO of Cress Line Hotels said the RY on tech isn't always obvious, but if you don't invest, it's going to cost you a bucket load Hacks, security issues, it's going to be costly And you're going to be inefficient. If you don't invest in tech, you're going to be behind and you're going to be at a competitive disadvantage, and so it's an interesting change of tone. I think back in the days when I was selling technology, it always be about the RY, and it seems that owners and operators now are focusing on how do we stay competitive and provide or meet the expectations of guests and staff. A lot of talk about people. I think panelists were paying lip service to the importance of people in hospitality but, honestly, few were sharing really meaningful things that we're doing beyond offering flexible shifts And, candidly, i think a lot of the talk was framed around labor, and it almost felt like a necessary evil. There were others that were exceptions to that. In, Peter Struble at Omni Resorts was talking about affordable housing for staff. He was talking about, he said, we're in the associate housing business and was developing three new buildings around the resorts and buying other motels and other buildings to house staff. So I did see some tangible ways to support people, but honestly, it was a little bit disheartening in some cases where people almost felt like a commodity or people were something to get rid of. For those that were focused on people, though, they also recognize the importance of the employer brand, and so people like James Bermingham at Virgin Hotels talked about Richard Branson, of course, the founder and chairman of Virgin Group doing this for decades, and he said that the key to solving the labor challenge is having a really strong employer brand and employer reputation. So you got to operate in the right way, have the right culture. That's going to provide you with an enduring ability to attract and retain talent. I think overall, in summary, there's a real opportunity to stand out in what I kind of felt was just a total sea of similarity. Many people said very, very similar things, and people that we've heard from recently on this show. People like Richard Garcia at Remington Hospitality, innovating in Beverage and Food, or Craig Poole, taking a dramatically different approach to people, stand out to me, and it's this opportunity that pushes me to stay on the hunt for the most interesting people building the most interesting things and sharing them with you here on the Hospitality Daily Podcast. So I'm going to keep that up. I'm going to stay on the hunt for those stories and inspiration to help you. But I hope this recap was helpful from the conference and would love to hear your thoughts.