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  • HITEC Special: Does EU GDPR Affect U.S. Hospitality Companies?

    By Alvaro Hidalgo. The EU General Data Protection Regulation has set a path towards protecting personal data which many other countries will follow. In a global industry such as hospitality, it should be a primary objective to take the steps towards compliance.

  • HFTP Report: Hospitality Data Security — Strategy for Data Protection and Regulation Compliance

    This guide from Hospitality Financial and Technology Professionals (HFTP(R)) covers safeguards that can be implemented in hospitality businesses today, tips on how to continuously improve security and data regulation compliance.

  • HFTP GDPR Guidelines: Privacy Policies for Hotels

    This document offers points to consider in the development of a hotel’s privacy policy. In view of the multiple organisational and legal structures under which hotels operate, as well as the complexity of the third party landscape that may be part of the complete guest experience, this document serves as a guideline only.

  • HFTP GDPR Guidelines: Hospitality Guest Registration Cards

    This document offers recommendations for guest information collection on the guest registration card along with consent for use. It can be used as a guideline for loyalty cards, health data, export of data outside of the EU, privacy policies and direct marketing.

125 Years of Excellence and a Bright Future

EHL ·9h
LAUSANNE, October 16th, 2018 - in the company of high officials of the Swiss Confederation and the Canton of Vaud, Ecole hoteliere de Lausanne celebrated its 125th anniversary on the night of October 15th.Amid big developments and numerous large-scale projects, EHL has celebrated its birthday, 125 years after its founder Jacques Tschumi opened the doors of the institution and set the new standards of modern hospitality.In the presence of the Federal Councilor Johann Schneider-Amman, the State Councilor Philippe Leuba, municipal officers of the City of Lausanne Natacha Litzistorf and Oscar Tosato, CEOs of prestigious companies and friends of EHL, this event honored the school's unique legacyand celebrated the pioneer and groundbreaking spirit which, to this day, still guidesEHL.Official speeches were followed by the show "Un reve pour demain" ("A dream for tomorrow"), conceived and created exclusively for this occasion by actresses Anne Richard and Viviane Bonelli, with an original musical composition by Herve Klopfenstein and a visual creation by Romain Rossel.On October 15th 1893, Jacque Tschumi, member of the Swiss Hoteliers Association, gathered 27 students in the premises of the Hotel d'Angleterre with a vision of professionalizing hotel management. This ambitious project that soon turned out to be a necessity, lives on today on all five continents and inspires many professions beyond hospitality."As is customary, EHL is a step ahead of its time. From this first small class, EHL has become an international Group which offers a large and complete range of learning solutions on its two campuses in Switzerland and a third one underway in Asia. The Group is supported by a worldwide alumni network, produces research projects and partnerships which in turn, generate an important innovation pipeline, and all of this while integrating cutting-edge digital evolutions and partnerships in its roadmap.EHL is a state of mind, a way of being that is passed on from generation to generation. Explore the school's hallways, talk to our students, see how their eyes sparkle, their enthusiasm will elate you. We pride ourselves on pursuing Jacques Tschumi's project, especially during such a rejoicing period for EHL Group" stated Michel Rochat, CEO.The campus in Passugg in the canton of Grisons is flourishing, the first hospitality innovation center in Europe is on its way, and the future campus in Lausanne is already an example for many other schools. More than celebrating the past, this birthday marks the start for an important period of growth for EHL Group.Partners and sponsors: Laurent Perrier | Breitling | Andros | Arena Paris la Defense | La Vaudoise | Implenia | Le Gruyere | OVV | TGV Lyria

The Future of Work: Look on the Bright Side?

EHL · 8 October 2018
In the view of futurist and 'recovering journalist,' Gary A. Bolles however, we shouldn't just focus on the negatives. We should look at these developments as an opportunity.Problem solving"Robots and software don't take jobs, they take tasks," he told Hospitality Insights following a keynote address to EHL's international advisory board. For humans, work means three things: solving problems, performing tasks, and using our skills.If we think differently about our skills and the kinds of problems we like to solve, we can continually look for the kinds of problems that robots and software can't perform. We actually can do more creative tasks that require more collaboration between people.As we transition to a digital work economy, educational institutes should be looking to provide lifelong learning rather than a chunk of education early in our lives. It will involve the 'unbundling' of work to provide dynamism and flexibility.Educational institutionsEducation "isn't this massive investment upfront and then very little as time goes along. It has to be a set of continual processes.""Some educational institutions see that as a threat because their model is so focused on early education. But instead I would encourage people to think of it as an opportunity. In the United States we always say: 'What business treats you for four years as a customer and for the rest of your life as a cash register, constantly donating back to your alma mater?'""Instead, if you're continually providing value to your customers, helping them with their lifelong working processes, that's a tremendous business opportunity for many educational institutions.""We're transitioning to what I call a digital work economy and it's happening in a blindlingly short period of time. But if we see this as a market transition, not just disruption, and the whole world of work is going to change, every school is going to change.""One of the biggest challenges of this transition to a digital work economy is that many of the analyses of what's happening to the world of work essentially look at the negative side of the ledger."As there's still a great deal of uncertainty as to the future which is somewhat murky, such analyses are speculative, Bolles says. (In his keynote address he refers to the 'fog on the highway' which is "so heavy we can't see 20 years down the road" and know exactly what skill sets are going to be needed.)People or Robots?On the positive side of the ledger, if we can use technology to make us better, "we can solver greater and greater problems" and that might lead to "an abundance of work". Otherwise, many will be left behind as they won't be able to acquire the new skills that are needed "and then it's going to be a rational act for many employers to say 'we can't find the people, so we'll have to automate those new tasks.'"With lifetime employment less and less likely, young people entering the workforce will need to be problem solvers who are able to adapt and are creative "because that's what will keep us ahead of robots and software." Plus they will need to be entrepreneurial in their mindset. "They need to go towards problems, solve new problems, as opposed to waiting for those problems to come to them."Gary A. Bolles is the Chair for the Future of Work for a think tank called Singularity University.Want to know more about the future of work? Check these additional resources out:Unbundling Work: Learning to Thrive in Disruptive Times - Gary A. BollesTechnology, jobs, and the future of work - McKinsey5 things to know about the future of jobs - World Economic Forum

Content Marketing Strategy in Hospitality: Choice Hotels Europe

EHL · 4 October 2018
In this article on the brand as publisher, we focus on Choice Hotels which has launched a travel portal to drive traffic to its booking site and collect customer data. Tess Mattisson, director of marketing for the European division of Choice Hotels International, spoke recently to EHL students about why she decided to launch the site and the benefits it has brought.When Tess Mattisson joined Choice Hotels in January 2016, the European division was languishing. With some 7,000 hotels globally, the US is the group's biggest market and that was the main focus of its marketing spend. Mattisson's goal was to put 'heads in beds' around Europe and figure out how to do that without additional budget.Transforming people for the digital ageHer approach was to question everything (she refers to herself as the 'why woman'). Her main objective was to turn the business into a more digital company, although she prefers to say she's in the business of transforming people "because it's the people at the core that will transform the business to survive the digital age."Why did they need to change the way they had done marketing in Europe? The international division had been second in line when it came to investments. However, it had growth potential, whereas the US already had a market share of some 25 percent in the US.Three main challenges were identified:Revenue (Choice, as a franchisor, gets a percentage of the gross operating revenues of its franchisees but the latter felt Choice was not providing 'strong enough value');A lack of brand awareness in Europe ("we needed to get our brand out there, we needed to get people's attention");And retention, bringing the guest closer to the brand by providing tangible value.The biggest reason why we needed to change was that brands are becoming publishers. Absolut Vodka is not a vodka producer anymore. They're a media company.Content Marketing Strategy at Choice Hotels - VideoInvestments in media and contentBrands are becoming publishers, she said, not because they have large piles of money to throw around, but "because they've realized they need to invest in media and content and become publishers if they're going to successfully sell their products further down the road."Consumers today expect us, as a brand, to actually be a publisher and add value through content and other types of services that are not directly connected to our products.So Choice Hotels Europe created its own 'vehicle', a site called TravelTop6 (yes, it's trademarked) to drive traffic to its booking platform, while gathering data on customer behavior. The site carries travel recommendations and tips for destinations which are near Choice Hotels. (So don't bother looking for information about countries such as Greece or the Netherlands where Choice doesn't have franchisees.)Micro-moments of travelBased on data from a 2015 Google study on micro-moments of travel, which stated that 87 percent of such moments take place on mobile, it made sense to take a 'mobile first' approach. The Google study was also seen as important for mapping out the various phases of the customer journey.We were strong in the booking phase of the journey but we needed to expand that to where the consumer is actually engaged - in the dreaming, planning, booking and experiencing micro-moments of travel.Mattisson outlined to Hospitality Insights in an interview how they had used Google's modeling: "We pretty much looked at where we were today, what the gap was between where we were and where customers were. And then we tried to fill that void. And the key component for us that we identified was the lack of high quality content."Content marketing is like dating. You need to add value, you don't talk about yourself on the first date for 40 minutes. People would be so bored, right? You listen, you ask questions, and you focus on the person in front of you.But, as Choice Hotels is a franchisor, it has to consider a range of stakeholders - not just the customers. Mattisson said she had to get 19 stakeholders on board, including the franchisees, some 500 of them. Previously they had argued that Choice should spend big on TV commercials but, given the budget constraints, that avenue was not an option unless they were going to get the occasional commercial spot in the afternoons when their target audience would not be watching anyway.Instead, Mattisson believes the TravelTop6 site has proved its worth. It has involved developing a research calendar to pinpoint areas of interest and outsourcing writing to freelancers, plus getting some help from influencers such as Kaptain Kenny.We don't produce any content that is not supported by research - insights, data mining, scraping a lot of sites, seeing what are people interested in and (finding out) what they talk about. And where is the gray space, where no one is present. We're not going to compete with TripAdvisor or Lonely Planet.As for the return on the (undisclosed) investment, she points to some 2.5 million new users viewing the content over a 12-month period, with 126,000 visits to the guides and more 3,400 visits to the Choice Hotels booking site. In terms of the bottom line, there has been a 35 percent increase in direct, organic online bookings year-on-year. "So yes, it's had an impact on the bottom line, on traffic to the website, and adding value to the guest."If you're wondering about the ethics of leveraging an apparently independent third-party site or 'Trojan horse' to drive traffic to one hotel group's booking site, the TravelTop6 site does state that the site is powered by Choice Hotels Europe and Choice Hotels Canada. (That said you do have to scroll down the page to the bottom).Mattisson's Top 6 recommendations on content marketingIf you want to become truly digital, take out the word digital. ("Marketing today isn't digital. It's just marketing.")Evolve. People don't mind change. Invest in building the strategy and involve the stakeholders in every single step.Base your marketing strategy on your consumers' needs, behavior and device usage.Identify the platforms where your customers are spending their time and tap into those.(Blend in, don't disrupt).Prioritize. "You can't be a rock star in everything you do. Be really good at something than mediocre at everything."Always remember the reason - the why - you're doing this. "Go back to where it all began."

The Need for Big Data and Quantitative Skills Training In Hospitality

EHL · 2 October 2018
This is why, as economists, we believe hospitality business schools that teach subjects such as finance, need to develop their students' skills in these areas.Technology nowadays allows firms to collect and analyze huge amounts of so-called big data, but in order to leverage these opportunities, hotels will need technical abilities and know-how.However, the biggest challenge faced by teachers of maths and other quantitative skills is how to get the message across to undergraduate students how important such skills will be in their future careers.Overcoming 'math anxiety'"I've survived up to this point without solving equations, so why should I start now?" is the typical reaction of many students. Indeed, researcher and academic Mark H. Ashcraft has highlighted the phenomenon of 'math anxiety' which he defines as "a feeling of tension, apprehension, or fear that interferes with math performance". Students may be tempted to try to math-based subjects but how can they overcome this in practice?Based on our experience as economics professors we have developed a survival kit for beginners.First, at your very first meeting with students, we recommend that teachers highlight the fact that this topic will be somewhat technical and that, without a rigorous approach, they will not be able to have a deep understanding of the subject.Second, when explaining something technical, start from the solution. Clarify what the final point is that you are aiming for and then explain why and how you plan to get there.A common mistake we make is to try to create some suspense and then surprise the student with a final revelation. What may be 'suspense' for you, however, is likely to spell confusion for the student and what you consider to be a final revelation, probably means panic for the student.We recommend that teachers use plenty of examples from the onset as business school students need practical applications first.Indeed, they love to be active. They do not want to listen to you passively as you move from one abstract theory to the next. Instead, they need to feel challenged in class.This can range from doing exercises to case studies and other activities, but the main point is to allow them to play an active rather than passive role. The old fashioned idea that the professor outlines theory in class and that the student is there to absorb it like a sponge and follow up with exercises at home, may be valid only in our wildest dreams.We also recommend that teachers embrace technology. Give students a virtual portfolio to manage, with apps, surveys, online quizzes and other tools that may appeal to millennials.To concludeQuantitative subjects such as maths and statistics will be increasingly crucial for hoteliers, but when you're teaching these subjects, they may need to be sugar-coated - more so than other courses - in order to make them more palatable.
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Restaurant Expansion Recipe: Creativity, Integrity and Trust

EHL · 1 October 2018
Maintaining standards during restaurant expansionAccording to EHL associate professor Marc Stierand and senior lecturer Frank Schutzendorf, it's all about hiring the right personnel and then building trust."You have to consider your creative team," says Stierand, the director of EHL's new Institute of Business Creativity (IBC). "You have to surround yourself with people who are capable and talented enough to understand what your ideas are all about."It also involves developing systems - whether for training or an organizational structure where the next generation of talent can watch and shadow a 'famous chef' like the late Joel Robuchon and learn all about their creative signature dishes. At the same time, there needs to be an organizational environment "so these creative chefs themselves don't get bored. They also want to (develop) their own signature."So it's a balancing act between the famous figure - the reason why customers go there (to a specific restaurant) and at the same time you have to foster a creative and inspiring work climate within the organization and of course that's tricky. It's not something where you can follow ten points and say, 'Okay, this is what we do.' It involves building trust, Stierand adds.In terms of organization, Schutzendorf says, four key people may be sent to operate a restaurant overseas: an executive chef, a sous chef, a sommelier and maitre d'. A restaurant expansion strategy clearly needs to develop talent but that talent can be poached as investors internationally seek to hire up-and-coming chefs. So loyalty is an important ingredient, says Schutzendorf, along with the competency and training they've acquired. "It's a quick win for any other restaurateur, taking somebody who has been flown in by a star chef - hire them and pay them more money."However, even though the offer may be interesting, young chefs should be cautious. "The facility and resources may not be there to execute the job correctly" and it may lead to an ambitious chef becoming demotivated. "Once you're out, it's very difficult to go back because by then trust has been blemished. So you have to tread carefully," Schutzendorf says.Sustaining creativity when restaurants operate overseasStierand's research has focused on creativity as he has interviewed top chefs such as Ferran Adria. Adria, while he still had elBulli on the Costa Brava in Spain, told him he worked with three or four chefs who could all be Ferran Adrias. 'They're as talented creatively as I am,' Adria had said. But the chefs knew they were in a creative 'hotspot' and didn't want to leave, because they knew that once they did, they wouldn't be able to return."Once you can establish something like this - and this does not necessarily have to do with money, it's simply that spirit you've created can't be much better than that (elsewhere)," Stierand says.When operating overseas, it may be difficult to source the right food ingredients, although certain hubs like Hong Kong and Macau can fly in food directly from Paris. So a restaurant in Doha may have to become creative and use local ingredients such as camel meat. Schutzendorf says this can reduce the risk of spending money on ingredients that local customers may not know or want. "So you have to adapt to the local environment, except again for these hubs like Macau and Hong Kong where the priority is not about profit. It's about standing out, (being) unique. And even if you don't fill the restaurant, you have a unique positioning which will potentially draw in customers.""Just look at the world of art and paintings," says Stierand. "When famous painters traveled to the Mediterranean, suddenly the colors, the lights changed. And I think this is where true creativity can happen." As for haute cuisine, "maybe you'll find it difficult to get the usual products, (so you have) to use local ingredients and do something extraordinary from those. That's true creativity.""You still need to see the creative signature, regardless of whether you use camel meat or poulet de Bresse," he adds.Overseas investors may, from time to time, approach 'star' chefs to open restaurants in their hotel or mall but it's not always a recipe that's successful. As Schutzendorf points out, the chefs will likely want to maintain control and say 'trust us because we don't operate any other way. It's either take it or leave it.'"Sometimes these Michelin-starred chefs get too stuck on their philosophy and don't adapt to the local culture. Nobody ever wants to close a restaurant ... but nevertheless a lot of restaurants fail."He cites the example of a Ducasse restaurant at the W Hotel in St Petersburg. Ducasse refused to make changes to the decor and cuisine. "At one point, Ducasse said 'no, this is my cuisine. This is how we do it.'" The restaurant eventually closed down. "It was far too early for St Petersburg. The concept was so revolutionary. There were no other hotels then. Now you have a lot of competition coming up and there is a nice food scene happening right there although the product is very scarce. But at that point in time it was too early.""Nobody ever wants to close a restaurant."Stierand believes it's better for leading chefs to be very selective and to say 'no' more often than 'yes' to proposals from investors. The chefs should think carefully whether the restaurant expansion plan fits with their creative identity and consider whether they will remain 'authentic.'At some point, the star chefs may be tempted to cash in and use their personal branding to sell supermarket products but, says Schutzendorf, integrity is an issue. "They're selling their soul. They're really selling their soul sometimes."Summing up, Stierand says the chefs have to be "absolutely in control", even if that means tensions with investors. A sustainable restaurant expansion strategy "(...) need(s) to (make) absolutely sure that (standards are maintained) even if you are not there physically." Customers, he adds, want and expect authentic cuisine.The chefs may want control of the cuisine, the team members, and even the glassware and silverware, says Schutzendorf, "because it's their reputation." However, that may lead to conflict with the investors. "The only criticism I have is that all these points are not laid out from the get-go, to say 'this is our philosophy, this is how we operate and this is our experience based on what we've done in the past and the scenarios we've lived through, because people did not meet our expectations and at one point they wanted returns on investment that were too fast. And so it gets very ugly sometimes."

Why all the Appellations, Bordeaux?

Ecole hoteliere de Lausanne (EHL)· 1 October 2018
Jean-Marie Cardebat, wine economics professor at the Universite de Bordeaux, director of its finance and economics research center (Larefi), and affiliate professor at INSEEC Business School, spoke to Hospitality Insights recently on the sidelines of a wine and hospitality management forum at EHL about issues currently affecting Bordeaux wine producers.

Content Marketing Strategy in Hospitality: Choice Hotels Europe

Ecole hoteliere de Lausanne (EHL)· 1 October 2018
In this article on the brand as publisher, we focus on Choice Hotels which has launched a travel portal to drive traffic to its booking site and collect customer data. Tess Mattisson, director of marketing for the European division of Choice Hotels International, spoke recently to EHL students about why she decided to launch the site and the benefits it has brought.

The Future of Work: Look on the Bright Side?

Ecole hoteliere de Lausanne (EHL)· 1 October 2018
Whenever you hear a news item about artificial intelligence and robots, which are now gaining a foothold in the hospitality industry and other sectors, the message is usually this: jobs are going to disappear, with perhaps millions of people facing long-term unemployment.

Online Customer Reviews: Their Impact on Restaurants

Ecole hoteliere de Lausanne (EHL)· 1 October 2018
Dining out, going for a movie, or enjoying a bottle of fine wine are all 'experience goods', that is, they have to be consumed or experienced in order for them to be assessed and evaluated. Online customer reviews are valuable as they allow potential consumers to get in-depth information from others for a relatively low cost and little effort. With one click, they can solve an information asymmetry problem in which service providers are better informed than customers. The internet allows customers to share their views and feedback cheaply and efficiently with a large audience.

The Need for Big Data and Quantitative Skills Training In Hospitality

Ecole hoteliere de Lausanne (EHL)· 1 October 2018
The hospitality industry is becoming increasingly complex, with financial engineering, corporate governance, and strategic interactions with other sectors now part and parcel of daily life. In addition, publicly-traded major hotel chains manage a portfolio of brands and deal with a range of other industries at the same time. Hotels can no longer rely on experience and 'savoir-faire' to get by, but need to hire staff who are comfortable with quantitative skills such as mathematics and statistics.

The (In)famous Article 404 of the Swiss Code of Obligations

Ecole hoteliere de Lausanne (EHL)· 1 October 2018
Contracts, whether for providing specific labor-related services or so-called ‘agency’ agreements, form the cornerstone of most industries ranging from hospitality to banking and are especially critical when they involve two or more parties from different countries. But what if there’s a dispute?

Single-Use Plastics: Hotels and Airlines are Cutting Down

EHL ·25 September 2018
From plastic straws to the complete elimination of single-use plastics, more and more in the hospitality industry are opting to create a sustainable travel experience.The world is now producing roughly 300 million tons of plastic each yearPlastic is one of the defining inventions of our time, yet there's no denying its negative impact on our environment. The low production cost and versatile range of applications make plastic a convenient comfort in the modern day. At the same time, the throwaway nature of these single-use products adds up to being one of the top sources of pollution throughout our oceans.In fact, about 8.8 million tons is then dumped directly into our oceans, a startling rate considering plastic will never fully decompose.From Starbucks to IKEA, many major corporations and businesses are opting to ditch single-use plastics from their day-to-day operations-and the hospitality space is no different. Hotels and airlines finds themselves with a unique opportunity to really impact the effects of global plastic consumption as they often provide disposable products at mass scales.Many major players in the hospitality industry have already eliminated plastic straws, while others have opted to phase out single-use plastic products entirely.Which major hotels and airlines specifically are leading the charge in sustainability?Continue to read this article here

Single-Use Plastics: Hotels and Airlines are Cutting Down

Ecole hoteliere de Lausanne (EHL)·24 September 2018
From plastic straws to the complete elimination of single-use plastics, more and more in the hospitality industry are opting to create a sustainable travel experience.

Hospitality education of the future

EHL ·17 September 2018
Have you noticed that currently many CEOs of the most important hotel chains are not hoteliers? Will this mean that in the future hospitality education will not be worthwhile?On one hand, we have the current CEOs coming from the world of business, law, finance and marketing. On the other hand, majority of today's graduates of top hotels schools in the world do not go into hotel operations. Instead, they aspire for more attractive positions in sectors such as banking, luxury, healthcare, consulting, retail and lately, start-ups.Therefore the question, why will hospitality education still be needed in the future? Why young graduates, the millennial's, do not wish do work in hotel operations anymore? Is it because the hotel industry is not attractive anymore and does not reflect the expectations their hospitality education created? However, we can also question why other industries hire students who have hospitality educational background. Could we then glimpse into the future for hospitality education?
Article by Stuart Pallister

The Future of Food: Transparency and Traceability Are Key

EHL ·14 September 2018
What are the main trends facing restaurateurs and the food industry currently, and where is gastronomy heading? Those are some of the questions posed during a panel session at the recent Window 2 the Future conference staged by Lausanne Hospitality Consulting at Ecole hoteliere de Lausanne.The quality of produce remains ever-important but transparency - and traceability - is critical for consumers."People want to know what they eat, where it comes from, how it was made. And with what ethics it was made," said panelist Peter Rebeiz, Chairman and CEO of Caviar House & Prunier.I think today we're more into ethics than taste. So in other words, ethics comes first, taste comes second, which is a vast difference to what it was 20 years ago.He pointed out that in major cities such as London and Paris, some 40 million meals are consumed every day. "How can that be quality?" However, he added, people tend to trust brands. "As soon as there's not a brand around they start to ask all sorts of questions about how was it made, why, where, so on and so forth.""Transparency is probably the name of the game. I also do believe that whether we're retailers or restaurateurs, I think we have quite a responsibility towards consumers today, more so than 20 years ago.""Consumers are in the driving seat.""That's a big, big change. I really do believe that the food critic, such as we've known it in the last 20-30 years, is a dying species. I think that will disappear. They will be replaced by consumer (reviews)."Last year, he said, his company provided some three million meals in total, of which 72,000 were shrimp cocktails. How do you source so many shrimps? "It's not that easy. It's very important that we, as providers, come up with the right products, with the right values."However, he said, food labeling remains a 'difficult issue', adding that consumers don't understand terms such as 'bio' or 'organic' as they tend to be "overused or misused. That's why it's important to educate consumers."Food producers are largely responsible for labeling their products, but Philipp Mosimann, Managing Director of Mosimann's London, wondered whether a 'neutral entity' would be able to "define what's good and what's not."As for the future of food, prices "will just start rocketing, especially in proteins." Consumers may have to pay 100 pounds for a steak, he said, with the result that "they'll have to change their diets.""We create the concepts, we educate the consumer. I think we've a vital part to play in that," Mosimann said, highlighting a recent Commonwealth event, where meals were prepared for 900 guests with some 140 dietary requirements. "That tells you a bit about the consumer essentially and which way it's heading."Food controls are getting stricter"I see less molecular, I see (greater efforts) to understand traceability, almost classifying farms. Through a royal warrant, we have very strict controls on all the products, allergens, traceability. We're quite blessed in the UK, a rich country with regard to produce, land, air, seasonality. For us it will continue to be more and more local."Michelin-restaurateur and Managing Director of Innovative Restaurant Concepts, Patrick Willis ,highlighted the role of local farmers in France have - and will continue to have - in providing 'incredible' produce. "You spend more money as there's a cost when you want to eat quality. There's a cost when you want good products. So you have to spend a bit more. And you have to do your research. You have to know where (to buy the produce). It does cost you more to be healthy."Some supermarkets in the US such as Whole Foods are already selling 'unbelievable products with taste," he noted.With prices of fish and meat set to soar, "there's a big push from chefs for vegetarian choices.""Running restaurants is an expensive proposal. If you play the Michelin game, you find out how expensive it is, (especially for two-star and three-star restaurants). Don't expect to be a rich man. But what I see emerging are smaller restaurants that change their menus more often and do a good job.""It's all about making it affordable, making it also so that the owners can survive. When I go to the market in southern France and I see what they want to charge for turbot or langoustines, and what you'd have to charge for that in a restaurant, you don't see these items on a lot of menus. What you see is duck, chicken and cote de boeuf, so there are a lot of changes."Willis cited the example of a large restaurant in Paris which uses a central kitchen to produce 'processed' food which had resulted in the restaurant losing its local clientele, although tourists still flock there. "They did this so they could save money on kitchen staff and food, but it's an inferior product. But it's still very busy and very successful."In response, Catalin Cighi, Managing Partner of Cain Hospitality Innovation, wondered what the point was of a superior product if the consumer couldn't tell the difference anyway."That's a subject I constantly struggle with," replied Willis. "When I was growing up, everybody knew what good food was about. All of that is changing. To have to educate people about what good food is going to be a lot of (hard) work. Because everything they think of as good is all processed.""I'm not going to eat fake meat. I'm not going to eat something that tastes like meat. I'm going to eat meat. (And I want) traceability."In the next 30 years there will another three billion people on the planet, he said. Water scarcity will be an issue, as will food shortages. Processed food will be the norm.Where to invest in food?At the end of the session, the four panelists were asked what they would invest in. Willis, true to form, said he'd invest in local farmers to make sure their products go to his restaurant. "I wouldn't be looking to do a lot of covers, 50-60 people a night would make me very happy. Serving reasonable food but watching the faces of my customers happy, knowing they got value for money, knowing they had a great time and that they'll come back. And that to me is the joy; making sure that people leave happy."Cighi somewhat cheekily suggested he'd put money into synthetic biology. (Willis responded by saying he'd need to be hypnotized to eat 'fake' meat as it would be 'hard to swallow.')Rebeiz said he'd invest in the 'service element' and over-the-counter products.The most intriguing suggestion, however, perhaps came from Philipp Mosimann. He suggested that restaurant chains could produce 'healthy fast food' in the not-too-distant future: "Very soon, in the next 10-15 years, we'll see the standardization of even very high-end levels of fine-dining cuisine, which will suddenly be able to be franchised en masse, with big corporations taking that on board."The 'Window 2 the Future' event, organized by Lausanne Hospitality Consulting, was held at EHL on 30 April 2018.

EHL's new Institute of Business Creativity (IBC)

EHL ·11 September 2018
Ecole hoteliere de Lausanne launches the Institute of Business Creativity, hosting the METRO Hospitality Lab for the development of novel training solutions in the hospitality industry.Launched in June 2018, the Institute of Business Creativity aims to build bridges between the business world and academia, and to produce relevant, highly impactful, practice-based research and solutions. Under the leadership of professors Marc Stierand, Institute Director, and Ian Millar, Institute Manager, this new structure will contribute to EHL's objective; to provide innovative educational models and to drive growth in the hospitality industry."I am very excited to have the opportunity to apply the research I have conducted on creativity over the past years. The Institute will allow us to leverage the unique industry knowledge of our key partners and our combined understanding of Hospitality technology, creativity and team management will truly give us the means to explore new ideas in a pragmatic and constructive manner", said Marc Stierand The Institute offers a wide spectrum of services, including dedicated research labs in partnership with international firms from the hospitality industry and beyond, tailor-made executive workshops and case studies to support business development and innovation. The Institute also provides an environment for developing and testing new concepts with the EHL community.Prominent experts from the hospitality industry and leading academic institutions from around the world have joined the Institute to contribute their expertise and collaborate on research projects. The Institute of Business Creativity will include several dedicated research labs, sponsored by international companies who will benefit from EHL's awarded research and faculty to develop innovative, leading-edge solutions to transform their industry.The METRO Hospitality Lab, sponsored by METRO AG and initiated by the two co-founders of Hospitality Digital GmbH (a Metro company) Kay Schwabedal (CEO) and Frederic Schumacher (Director Innovations), is the first research project within the Institute of Business Creativity. This lab will focus on the HoReCa industry (Hotels, Restaurants, Catering) and will be dedicated to the exploration and design of new HoReCa education and training solutions."This is a new and fascinating step in the growing relationship between EHL and METRO. We are all extremely enthusiastic to bring our respective strengths to the table and work towards a common goal", said Ian Millar about the new collaboration.The research will focus on the relationship between the digitalization of operational training and human interactions. The Master-Apprentice approach will be examined to determine how and where human interaction, such as mentor coaching or expert training, is combined most effectively with technological solutions."Our objective is nothing less than to make a significant contribution to the digitalisation of the HoReCa industry. We are convinced that this way there are considerable opportunities for small and mediumsized companies in particular to become even more successful", said Olaf Koch, Chairman of the Management Board of METRO AG. "EHL and METRO, we both share the same passion: Through our collaboration, we are combining our industry and technology knowledge to support together the digital transformation of our HoReCa customers. I am convinced that our customers will benefit even more from our strategic alliance in the future."METRO's goal is to help their clients -small and medium-sized businesses in the hospitality and food retail industries - succeed in their ventures. Based on previous studies by EHL, this success is closely correlated to enhanced training methods. Results from the research will be presented in 2019, allowing all industry professionals to benefit from the findings.

Frugal Innovation in Hospitality: Insights From Navi Radjou

EHL ·11 September 2018
Frugal Innovation - or Jugaad: how to do more with lessIn a recent keynote address to Ecole hoteliere de Lausanne's prestigious international advisory board, innovation advocate and author Navi Radjou outlined the principles of frugal business models. These go beyond creating a new product for emerging markets - be it a fridge that doesn't use electricity or an affordable portable infant warmer designed like a mini sleeping bag that has saved the lives of hundreds of thousands of premature babies - but rather they create new product lines or business units.Radjou cited the example of Renault-Nissan which had launched a low-cost car, the Logan, in India with Mahindra. Those vehicles used traditional combustion engines. The 'next disruption', as Radjou put it, was to develop more sustainable transportation such as an $8,000 electric vehicle for the China market.Radjou argued that as consumers become more environmentally conscious, it will be important for companies to seek a competitive advantage by ensuring that products and services are sustainable.They may also need to consider frugal mental models or mindsets.Today we think about selling products and services to customers. But what if the next generation of consumers says 'I create, therefore I am' - and want to make their own products using 3D printers and industrial tools which were previously only available to high-end manufacturers?Embracing the sharing and circular economiesAs for the hospitality industry, he says, it should look to embrace two major paradigms that are emerging: the sharing and circular economies.In terms of the sharing economy, we've seen the emergence of companies like Airbnb and Uber, but Radjou believes the business-to-business (B2B) sharing economy will be "far bigger" than the business-to consumer (B2C) sharing economy which he puts at 350 billion dollars. He cites as an example of a B2B company Floow2 in the Netherlands which enables firms to share assets and resources, such as construction or hospital equipment."So that's something to think about: how can you also be the pioneer? Maybe Airbnb will be disrupting you on the B2C side. Maybe there's an opportunity for you to be a pioneer in the B2B sharing economy."Accor: 'A great case study of frugal innovation'The Accor group, which has appointed a senior vice president for entrepreneurship advocacy, is connecting with 'nimble start-ups' who may be able to help the hotel chain deliver a better guest experience or source new building materials that are sustainable."They have essentially created a whole new governance model at Accor group to practice what we call 'open innovation' which is to go outside their company and team up with agile start-ups who can help them not only innovate faster and better, but in a more sustainable way," Radjou told Hospitality Insights.As for the circular economy, there will be increasing demand for resources so recycling will be critical as companies look to re-use waste in "very creative ways," whether it be jeans made out of recycled plastic bottles or cosmetics and other products made from coffee waste.Pushing the envelope on sustainabilityIn his keynote, Radjou also highlighted the International Tourism Partnership's Hotel Global Decarbonisation Report, which calls for hotels to reduce their greenhouse gas (GHG) emissions by 66 percent by 2030 and by 90 percent by 2050. Although the study was 'fascinating', Radjou didn't think it would be enough for the hospitality industry to reduce its carbon footprint. Instead, it should focus on creating a more positive impact instead of doing less harm."What if hotels were to become self-sufficient units which are able to produce their goods and services within the hotel itself?"He points to a service sector company in Tokyo which grows its own rice and vegetables for its canteen. Hotels, he adds, are also creating urban gardens on their rooftops.Another example of "how we can push the envelope on sustainability," he says, is the factory or hotel as a forest. "What if business becomes nature?"While that may seem a little far-fetched, a mountain forest hotel is being built in Guizhou in China as a way not only to reduce pollution but also improve air quality. For Radjou, the project sends a clear message that "the hospitality sector can be a kind of global leader in setting new standards in terms of ecological innovation." However, it will require strong leadership to make it happen.As he points out in an interview with Hospitality Insights, "what is important is that the hotel industry has to adopt frugal innovation not only because it's going to help them save money and maybe create new revenues."Frugal innovation is also needed because the next generations of consumers - Gen Y millennials and Generation Z - are going to be looking for brands to be socially and environmentally responsible, and will start disrupting the hospitality sector by 'voting' with their wallets."Frugal innovation is a fantastic lever," he says, to deliver services "faster, better, cheaper. Frugal innovation also a great way for an entrepreneur to create a whole new economic model that provides an alternative to the very resource-intensive way we have built the capitalistic society so far."

Airbnb quo vadis?

EHL ·10 September 2018
While Airbnb has not reinvented the wheel its three founders have shown enough drive and foresight to organise and centralise a vast but disparate market and to present it to customers as a true alternative to hotels. They furthermore showed enough perseverance to make the company evolve from humble beginnings to a corporation today valued at around $30 billion (more than companies such as Lufthansa, Burberry or Intercontinental) and increasingly active outside the rental of private rooms to travellers.From a mattress to a major player in the lodging industryIn 2007 Brian Chesky and Joe Gebbia notice that hotel rooms in the Bay area go quickly during conferences. Both invest in air mattresses and offer some space in their San Francisco flat to three conference attendants. Sometime later in 2008, joined by Nathan Blecharczyk a former roommate of Gebbia's, they extend their idea, launch Air Bed and Breakfast and offer rooms during the Democratic National Convention in Denver. They also take the opportunity to raise $30'000 for their start-up and to generate some buzz to get it known to a broader target group. During this time Air Bed and Breakfast which was to change its name to Airbnb was not the only actor. Other companies such as VRBO or HomeAway were already offering platforms for private home rentals. Airbnb, on the other hand, took the daring step to not only list rentals for entire homes but also for rooms, effectively mixing it with the classic Bed and Breakfast concept. It also made the business available to a larger population of hosts and guests by checking availabilities and booking in real time with a simple click.Airbnb's first hosts were found via Craigslist and it quickly managed to build a broader community. One of its unique selling propositions and promise which is still one of its major strengths is to make out-of-towners feel like locals. A spirit which very much hit the Zeitgeist and continues to this day to attract guests who want a more inclusive experience they cannot get in hotels. By 2011, and with the help of the Y Combinator and its seed funding of $20'000, the company which once left the founders heavily indebted and close to giving up managed a valuation of $1 billion and started its international expansion.From lodging to experiences...Once the lodging industry conquered, Airbnb started to turn its interest to other business fields in the travel industry. In 2016, in line with the "out-of-towner being a local" idea, guests started to be able to book tours (or "experiences" as they are called on Airbnb) with locals instead of official tour guides. For the moment, this hand-picked field proposes 25'000 experiences in 1'000 cities but is meant to be a future cornerstone of the new Airbnb. At the same time, it created Trips which added places such as city guides or restaurant reservations to home-sharing and experiences. One year later it started to build an apartment block in Florida which guests can rent up to 180 days a year and which is meant to compete with extended-stays facilities in a more personal and contemporaneous way. In this novel move Airbnb also tried to find an effective way of circumventing ever stricter laws put out by several city councils and regulators.... to the starsEarlier this year Airbnb announced its roadmap for the upcoming years which concentrates around four dimensions:Revamping of its core business by adding new property types such as B&B, Boutiques, Unique and Vacation Home in addition to existing Entire Home, Private Room and Shared Space types. This should allow guests to better tailor their experience and make it easier to find the dream home/location on a platform that today remains difficult to navigate at times. It should also allow hosts to better differentiate their offering and increase their occupancy and profit.Launch and development of Airbnb Plus which takes Airbnb's best listings and upgrades them by offering multiple amenities and inspections to ensure guests can enjoy a hotel-like service while keeping the local atmosphere of a place. This service started out in 2'000 homes in 13 cities worldwide. This is complemented by Airbnb Beyond which offers unique trips to customers.Launch of Airbnb Collections which allows guests to find a home for every occasion such as weddings, honeymoons, business meetings and not simply as a substitute for a hotel room during vacationing.Giving back to the community by revamping its Superhost programme and launching a new guest membership programme which should both offer benefits to the best and most active users of the platform.All of these evolutions are part of the founders ultimate goal to become the Amazon of the travel industry by offering a one-stop shop where one can book a flight, a place to stay, and tours through Airbnb, not to mention be a host in their home town. According to Brian Chesky the future of Airbnb goes beyond accommodation. In a recent interview he stated "I want to make sure--and we're certainly on that path--that we are not just a home sharing company. That we can take big bets and be an end-to-end travel company". The foray into the experience market therefore only constitutes a first step for Airbnb away from the home-sharing market. This, however, does not seem to be the end of the journey. One of Chesky's goals is for guests to use Airbnb to inspire travel. In this new model travellers do not chose where to stay, how to get there and then what to do but will get influenced where to go and what to do and then book what is necessary to achieve this desired experience. If possible all through Airbnb.Bumps on the roadAirbnb has also felt some backlash over its negative side effects in recent years. With the popularity of home sharing, via Airbnb and other platforms, local residents in strata properties get annoyed by the comings and goings in the buildings. As a consequence, many now forbid or restrict the short term renting of flats or rooms to their owners. The same is true for owners not wanting their renters to sublet their flats.City councils have also started to get actively involved due to two major reasons. First, they want a part of the pie by collecting taxes from hosts and/or guests which is not easily feasible due to a lack of information on the identity of hosts and the occupancy of the home. Second, a lack of living space, and as a consequence strong increases in rents and property prices, plague citizens in many big cities. Airbnb has been made a culprit which is responsible for this problem as it is seen to be more profitable to rent rooms on Airbnb than to rent one's entire flat in a classic fashion. Airbnb's future therefore will depend on how it can manage these regulatory hurdles it is facing in many of its key markets. Talks with city councils and the introduction of some solutions to alleviate these problems as well as the diversification into different business segments show that the company is aware of the danger and is taking appropriate action to remain successful in the future.Another problem is situated at the core of Airbnb's business model and is related to trust. Initially, Airbnb was met with scepticism as it was argued that guests and hosts would feel unease at sharing a home with an unknown person. Airbnb has proven everyone wrong thus far but the question remains how many people are willing to share their home or to stay at an unknown's place. Is it a niche or is it a more large scale phenomenon which is equally applicable to different regions and cultures? This may have a non-negligible effect on Airbnb's growth and profitability in the future. Airbnb has also recognised this problem by incorporating checks and controls for their "Experience" business and is also getting stricter on the accommodation business as for example through the Airbnb Plus service.Finally, the traditional lodging industry, and to a lesser extent OTAs, have also started to react to Airbnb's threat to their business model by either offering services or experiences which go in Airbnb's direction (e.g. Tripadvisor), by badmouthing Airbnb with customers or by lobbying with regulators.ConclusionAirbnb has undeniably been a huge success story in the lodging industry and has managed to disrupt the way we travel and interact with lodging companies. The broader scope it is embarking on constitutes a natural evolution in the life-cycle of a company and appears today to be a wise move in times in which regulators, politicians and competitors are making the life of sharing economy companies more complicated. Travellers can only hope for an equivalent boost in the areas Airbnb is targeting to make traveling experiences more easily available and more inclusive.

Gender Diversity - a True Value Added for Companies

EHL · 7 September 2018
According to a recent white paper by the Hospitality Industry Pipeline (HIP) Coalition the workforce in the tourism and hospitality industry is comprised of 70% women. This number is remarkable and inspiring for gender diversity and parity on the job market indicating that women are a force to be reckoned with in the industry. It, however, hides a less pleasant picture once analyzing the upper echelons of companies. The white paper further finds that in the same companies only 20% of executive officers and a staggeringly low 8% of directors are female. This is surprising, as a majority of studies find a positive influence of gender diversity on firm performance. More gender diverse corporations are more likely to display high returns, while those at the bottom of the diversity scale are clearly lagging in terms of performance.Based on this evidence, a study on gender diversity and its influence on corporate performance of Swedish corporations was performed at EHL last year. Sweden constitutes an ideal setting to study these questions as it is considered a very inclusive society which is taken as exemplary in the European context. It has not only achieved relatively high gender integration in its companies without resorting to quotas, but also more generally displays an open discourse on all social matters both in its civil society and corporate world.The findings of the study paint a diverse picture of the Swedish environment over the past 10 years offering interesting insights. The proportion of women employees, women managers and women directors has doubled for the first two dimensions and tripled for the latter over the past decade. This constitutes a positive message that things are evolving towards a more inclusive corporate environment. While the overall gender division of the workforce in the country is close to equal (48% women) only 34% of the workforce of listed companies is female. This is only marginally higher than the 28% and 27% female representation on executive teams respectively boards of directors. It, thus, appears that career paths of women is rather aligned in the Swedish context. This ideal situation is in clear opposition to what has been evidenced above in the hospitality industry where there is a clear gap between workforce and managerial positions. However, when analyzing the situation in more depth it becomes apparent that companies behave very differently depending on industry and corporate characteristics. Some companies continue to have until today male only boards and executive teams while others have up to 2/3 of women on these two dimensions.Another question the study tries to answer is the implications of gender diversity on corporate performance. In a nutshell, results suggest that companies should do everything in their power to hire women and this at all hierarchical levels. In terms of corporate valuation (Tobin's Q) having more women on the work force, executive team or board leads to a strongly positive outcome. Turning to accounting performance (ROE, ROI) only women in operating positions (workforce and executive team) lead to a strongly positive increase in performance. In a last step, the study looks in more depth into the actual proportion of women along all three dimensions. It has been argued that there needs to be a critical mass of 30% women (or any other diversity-related measure for that matter) to provoke a true change in the working and mentality of a company by overcoming socially constructed barriers that often occur when a minority is being integrated into a previously homogenous (male-dominated) group. Evidence in the study goes in this direction as performance increases the most once the proportion of female and male representation tends towards parity for the operational positions.We believe this study to make a strong policy and business case for the inclusion of women in the workforce and their progression into executive and decision making roles. Diversity appears not only important on boards of directors, but even more so at the managerial and employee level. This is particularly remarkable as it questions legislative actions on the pan-European and national levels discussing female representation on board levels only, here shown to be less significant to performance. The findings suggest a focus shift amongst policy makers to prioritize the increase of women at all corporate levels and to facilitate overall career paths, in order to observe greater benefits from gender diversity. The positive economic and financial effect of women in the workforce and executive positions goes beyond the obvious societal argument of fairness and equality. This could inspire share- and stakeholders to increase pressure on corporations to engage into more gender diversity, and thus speed up the progress towards equality in the corporate setting.

Hotel Booking Sites Under Scrutiny: Implications for the Hotel Industry

EHL · 4 September 2018
At the end of June, the UK's Competition and Markets Authority (CMA) launched a crackdown on a number of hotel booking sites due to concerns they were breaking consumer protection law. Concerns included search results rankings, pressure selling, discount claims, and hidden charges. The CMA has sent warning letters to a "range of sites", demanding that these booking sites review the way they rank and display information, and comply with the law. It says "the next step is to take any necessary action - including through the courts if needed - to ensure people get a fair deal."EHL assistant professor of marketing Dr Meng-Mei Maggie Chen examines the implications, not only for the hotel booking sites, but for the travel industry as a whole.Hotels search results rankingsMajor e-commerce sites generally use algorithms to determine search result rankings. As these algorithms are effectively their trade secrets, this makes them difficult - if not almost impossible - to decode. For example, who can accurately decipher Google's search engine algorithms? Are users influenced by Google results rankings and do they trust Google? Such questions demonstrate the complexity of search results rankings.The rankings can be influenced by all sorts of factors, ranging from customer reviews to conversion rates and other factors. In other words, even if a company is willing to pay the highest commission rate in percentage terms, if its conversion rate is low or customer reviews are negative, it will not be able to buy its way to the top spot in the search results. Some hoteliers blame the commission percentage for not being able to have a prominent ranking in the sites of online travel agencies or OTAs, but ignore the opportunities they have to optimize their offerings and customer relationship management on travel booking sites.Pressure selling on travel sitesConduct a quick search on Amazon and eBay and you will find similar practices. For example, a search on Amazon shows "only one left in stock" for a printer, while another on eBay shows "almost gone" for a monitor. On the other hand, travel sites, such as those of airlines or hotels, also apply pressure selling tactics. With regard to the CMA's recommendations, do all industries need to review the way information is presented on websites?Discount claimsIn the hotel industry, hoteliers set rack rates as their highest listed prices, but hardly any charge customers these rates. Hoteliers tend to charge "discounted" rack rates, only charging rack rates during short, high demand periods.The CMA used an example of discount claims based on a higher price that was only available for a brief period. This may then impact how hotels display their discounts online and require them to identify what is being used as the basis for the room rate discount, so the CMA recommendation would not just affect travel booking sites.Hotel booking hidden chargesThe concern about unexpected extra charges is well justified. Some travel sites only show all extra charges towards the end of the booking process. When consumers do eventually see the final price with all extra charges, they have the option of abandoning the booking process to start all over again. The practice of not showing these extra charges upfront may waste customers' time. The implication is not limited to travel sites but the entire hotel industry.Trust creates the marketConsumers shop at travel sites because they want a comprehensive list of available travel products. Andrea Coscelli, Chief Executive of the CMA, stated in a news release that "booking sites can make it so much easier to choose your holiday, but only if people are able to trust them". Do consumers trust these travel sites?According to the CMA, about 70 percent of people who shop around for accommodation use hotel booking sites. This high percentage should serve as evidence of consumers' trust.Because of this level of trust, travel sites become markets full of potential travellers interested in buying travel products. To retain and grow these markets, travel sites invest heavily in advertising and technology. To gain access to these markets, hoteliers pay commissions to travel sites for business generated from these sites. Hoteliers need to leverage, not fight against, these travel sites.Although the CMA's observations focus on travel sites, its implications are industry wide. Hoteliers should review how their own website displays information and optimize that information and customer relationship management on travel sites.

The Origins Of The Hospitality Industry And What Lies Ahead

EHL · 3 September 2018
Thousands of years ago, when road networks were scarce and traveling was cumbersome strangers arriving in a foreign land had to rely on either their camping skills or a local's kindness when looking for shelter. During the age of pilgrimage and the development of major trade routes throughout Europe, it was mostly inns and taverns offering primitive rooms to weary travelers. The idea of a hotel built for the sole purpose of hosting guests did not exist in Europe until the 18th century, when technological progress and the introduction of faster and more reliable modes of transport made long distance travel available to wider public. With the influx of large numbers of foreigners into major cities, the need for accommodation led to the opening of the first hotels in the modern sense. Since then, the sector has known a nearly unbroken run of growth and international expansion.Over the last two decades, international departures have more than doubled from around 600 million to more than 1.4 billion in 2016.Thanks to this immense potential a network of service providers has developed that caters to nearly every desire imaginable. Hospitality has gradually become one of the largest and most diverse industries, employing hundreds of millions spread over different sectors.Today, businesses in the industry can generally be divided into four categories:LodgingFood & BeverageRecreationTravel & TourismEvery category under the umbrella of the term "hospitality" further contains many different sub-sector and operators. The mere global scale of the industry makes it difficult to provide a conclusive overview without taking up hours of your time. Travel, for instance, encompasses all modes of transportation available to travelers, including coaches, airplanes, vessels, taxis etc. While all sectors are interconnected and reliant on each other, each one of them is facing unique challenges and opportunities in the future.The importance of innovation in hospitalityGoing forward, the key for companies looking to defend or expand their current position in the market will be to keep up with the pace of innovation.The emergence of new technologies such as artificial intelligence (AI) and the internet of things (IoT), means that providers are now faced with the challenge of moving their offer into the era of digitalization.The availability of extensive data on each individual guest will make it possible for companies to tailor their offers at a bespoke level, leading to closer and more immersive client interaction.Hotel rooms that automatically adjust the lighting and the temperature to each traveler's personal preferences can enhance guest experience and thus make it more likely for them to return. Traditional check-in and guest interaction procedures at hotels will likely see a fundamental overhaul.The introduction of voice recognition software, for instance, will enable hotels to automate tasks that would traditionally be performed by a human.This will result in more efficient processes at properties all around the world. While procedures are being streamlined, vehicles, amenities and buildings become smarter and more interactive.The challenge for providers will be to keep alive the human touch that has made hospitality establishments so successful. At the same time, adapting to and using these new technologies will be crucial in the fight for customers in one of the most competitive markets in the world.Need more resources on Hospitality Industry trends? Check these articles out:High-tech hotel wars: Sleeping in China just got more futuristic - CNN New Technologies Will Revolutionize The Hospitality Industry - Forbes

Do Fine Wines Still Have Their Place in Restaurant Wine Lists?

EHL · 3 September 2018
'Upscale' or gastronomic restaurants have seen many changes over the past 20 years as we have experienced the influence of social media, the globalization of cuisines, and the role of wine in the cellars and menus of restaurants. Several experts came together at Ecole hoteliere de Lausanne recently to discuss the latter issue in a roundtable session.Restaurant wine list management: four major trendsIn our view, there are four major trends that call into question the traditional way of managing a restaurant's cellar and wine list:The wine industry is becoming more and more complex and dynamic.While in the past, Bordeaux held the lion's share, it is now just one of many wine regions both in historically wine-producing countries and in the new world.Thus, Burgundy, but also Tuscany, Piedmont, Priorat, California, Mendoza, and even the Valais (and more generally Switzerland), now attract the interest of wine experts, amateurs and enthusiasts, collectors and increasingly also investors.Consumers, in general, are becoming more demanding and better informed.As Bordeaux University professor and wine economist Jean-Marie Cardebat stated during the roundtable session, they know where to get information and this in real time thanks to the many smartphone applications.They are also becoming more and more versatile in their preferences, resulting in sometimes abrupt changes in the demand and price of fine wines.Fine wines, especially the most famous ones, have appreciated at a rate well above inflation since 2000.Thus, the first growth wines from Bordeaux have gone from prices of between 80 and 200 CHF a bottle 15 years ago to a range of 400 to more than 1,000 CHF today.This trend has also resulted in price increases in wines that were once the preserve of amateurs and connoisseurs.In 2000, the Grange des Peres red (Languedoc-Roussillon), the cuvee of the Bourg de Clos Rougeard (Loire), or Chardonnay of Gantenbein (Grisons) all cost less than 50 CHF per bottle.Since then, their prices have risen by multiples of three to five.Financial pressure on restaurantsThe financial pressure on restaurants to improve their bottom line has greatly increased even though, paradoxically, this objective has become notoriously more difficult to achieve than in the past due to competition getting stronger.As one model disappears ...If we add stricter regulations on alcohol consumption and blood alcohol levels to this complex situation, it is clear that the business model that prevailed in the most prestigious restaurants of western Europe these last decades is dead.It is no longer possible (with rare exceptions) to maintain a large wine cellar with great wines and sell them with a margin of four, five or even six times the purchase price.In this context, it is therefore not surprising to find that more and more restaurants are working without a dedicated sommelier, with a short wine list in close collaboration with wine merchants, and a steady stream of varying references - often as part of 'wine of the month' offerings. As wine is a key element of the customer's experience in an upmarket restaurant, it is obvious that such solutions fail to deal with the issues.... A new model appears.Another solution is emerging, however. It is still in its infancy and has its share of practical difficulties. This is similar to the 'asset-light' approach which has driven the hotel sector since 1990. In the hotel industry, this approach has resulted in the disinvestment of historic hotel groups from their properties, which are now managed by independent entities specializing in hotel real estate, with a new-found focus on the management of hotels and its related services.In the world of restaurants, we are seeing the emergence of services which allow restaurants to operate with reduced cellars, while still offering wine lists likely to appeal to a range of consumer profiles.During the roundtable session, Vino e Finanza wine consultant Christian Roger outlined the development of sales depots, often managed by winemakers, which offer restaurateurs access to a vast stock of wines, or the role of investment funds that "can bring wines to their perfect maturity", thus allowing restaurant owners to avoid tying up considerable amounts of money, while letting them buy vintage premier cru or first growth wines at market prices.The benefits of these innovative asset-light approaches are obvious.First, less capital is tied up in the cellar.In addition to reducing financial risks, EHL senior lecturer Rene Roger observed that it allows restaurateurs to operate with lower margins and potentially be able to sell more bottles."For restaurateurs, the wine list is the last of their worries," he told the session. "It's very easy to select the wine and it's very easy to use a markup. Take any wine list, you'll notice that most of the sommeliers are using a markup of three." This margin can be broken down into three components: the initial cost of purchasing a bottle; overheads such as storage, insurance, service, etc.; and net profit margin. "This is wrong. We should pay attention to how much the client expects to pay in a restaurant," he added.In addition, these approaches allow restaurants to maintain a wide selection of wines so that wine lists can vary according to consumer preferences. Professor Cardebat also notes that these approaches can coexist with the traditional approach, as they can narrow the gap between more established restaurants, which have witnessed the golden years, and newcomers.Of course, these approaches also have disadvantages. Outsourcing an important task such as cellar management is not trivial. According to agency theory, this amounts to introducing an agent to whom the principal (the owner/manager of the restaurant) delegates certain tasks, which can lead to conflicts of interest and costs.The main obstacle, however, is probably the sharing of margins between restaurant owners and the companies to which the management of the winery is subcontracted.In addition, the role of the sommelier remains unresolved: Rene Roger emphasizes the importance of offering real added-value to consumers, something that French chef Bernard Loiseau understood perfectly well, as he had both very fine wines on his wine list and unique wines from unknown small producers.A new business opportunity?The advantages of outsourcing part of the cellar management then could be curtailed somewhat due to practical difficulties. Here again, the evolution of the hotel industry could point to a potential solution as the focus on the core business of hotel groups has been accompanied by the creation of a new business, the 'hotel asset manager' whose role is to align the interests of hotel owners and operators.In the context of the restaurant industry, it is possible to imagine the emergence of a 'wine cellar manager' with the triple role of adviser (especially for the creation of the wine list), educator (for the sommelier) and manager of the relationship between restaurant owners and their wine subcontractors.The roundtable discussion on Managing Restaurant Wine Lists and Cellars in 2018 was held at EHL in Switzerland on May 14th, 2018 as part of the 2nd Wine & Hospitality Management Workshop.

Celebrity Chefs: Are They Worth It?

EHL · 3 September 2018
Celebrity chefs are 'very expensive' but they can bring instant brand recognition to your hotel restaurant. That was the general consensus among panelists at the F&B breakout session at the International Hotel Investment Forum held recently in Berlin.Celebrity chefs: a recipe for success?Moderator Sophie Perret , director of HVS in London, raised the issue of celebrity chefs during the session, saying that some in the industry still feel it's a 'recipe for success'. Jon Yantin , Managing Partner - EMEA of F&B advisory firm Hospitality House, said the chef is not irrelevant but "if anyone thinks Gordon Ramsey cooked their steak, he wasn't there."It's naive to believe Gordon Ramsey is cooking your food ... but the chef has become the brand. That's the really important piece.Yantin stressed that the hotel owner or operator's vision of how to use a particular space is more important than the concept. But he said, he was agnostic as to whether a celebrity chef should be brought in or the restaurant should serve pizzas.Singling out another celebrity chef, Yantin said Jason Atherton had taken a 'portfolio approach' with his teams. "Again, most people don't expect Jason Atherton is grilling their seabream, so it has moved on correctly where it's not about the chefs themselves, it's about the concept around that chef, the vision that the chef brings."Is it right to say no celebrity chefs? I don't agree with that. There are good examples in the marketplace now, where it's not about the person, it's about the vision they've created and the style they bring.Hoteliers have the opportunity to create their own celebrity chefsAnother panelist, restaurant designer and operator Bob Puccini, CEO of The Puccini Group, spoke about how he opened Wolfgang Puck's first restaurants in Los Angeles and San Francisco in 1989. "We did about 12 million dollars a year which was a lot of money in those days - and it's not so bad even today. When that restaurant dropped to about eight or nine million, which it started to do in the mid-90s, it would almost get to the point of losing money because it's very expensive to work with celebrity chefs."He added that his group has converted many restaurants that have failed and he advocated that hoteliers should create their own celebrity chef through marketing.It takes a little bit of time but you can create your own brand around a chef with personality who cooks well. The mistake hoteliers make is thinking about the restaurant as the hub of the hotel. Think of them as the hub of the community because if they're not that, they'll never ever be successful."There's one hotel here in town that we've talked to about renovating because they were losing a million euros a year with a two-star Michelin restaurant. That's a lot of money to pay for the privilege of having somebody cook food that's just an exposition of technique. So my feeling is you're much better off doing an upper-middle class restaurant that's popular, that people will come in, and serve your community as well as the guests in your hotel."Accor is a major proponent of the hotel as a community hub and its group CEO of F&B, Amir Nahai, told the IHIF breakout session that hoteliers should think and invest like restaurateurs when thinking about the community at large.Watch the video: What Does Innovation Mean in Food and Beverage?AccorHotels' CEO of Global F&B, Amir Nahai told a recent panel discussion at Ecole hoteliere de Lausanne that, for the hotel group, innovation is all about getting closer to their customers.Creating strategic alliances with celebrity chefsA fourth panelist, Mps Puri, the chief executive of Nira Hotels and Resorts, said it's sometimes easier to bring in a celebrity chef as hotels could form "a strategic brand alliance."You're aligning yourself with somebody else that's a brand so it lends value to your brand or to what you're doing. Secondly, you don't have to worry about it because they'll bring the team and put the thing together."But when you do it yourself, you really need to have very strong food, bar, wine, and service cultures, and if you've got entertainment, a sincere entertainment culture. And oftentimes that's where things don't go perfectly but that's what needs to happen." He added that he himself is involved with an independent restaurant in London that does half a million pounds a week. "But it has a very strong culture and that's what is required in order to do it successfully."The session came in the wake of the news that celebrity TV chef Jamie Oliver had had to close down some of his Italian restaurants. "I feel for anyone that's struggling with a business," Yantin told Hospitality Insights, "but if you look at the fallout in the UK, it's not just Jamie Oliver, it's Prezzo and Byron."Italian-themed restaurant chain Prezzo and burger chain Byron are closing a third of their outlets, the Financial Times has reported, while Jamie's Italian has announced it is closing 12 of its restaurants under a company voluntary agreement or CVA."Is Jamie's Italian as relevant as it could or should be? Is the price point correct? Is the wider experience strong? You've got to be on point because there's so much competition coming through and consumers aren't stupid."The cost of working with celebrity chefsAlso on the sidelines of the IHIF, Puccini told Hospitality Insights that although it may make sense to bring in a celebrity chef initially to attract customers on the strength of their personal branding, investors pay a premium for their personal branding and the extra costs in terms of labor to maintain their reputation can be high."That's great for the start but it really can dwindle off relatively quickly because they're hardly ever there. So their visibility is low. And if the restaurant, for whatever reason, doesn't come together properly, they're going to fail just about as quickly as anybody else."His advice?Find chefs that have personality and promote them because, within a small trade area, it's relatively easy to create a reputation around a chef if he's willing to be out there in front of the public and become a personality himself.

Celebrity Chefs: Are They Worth It?

Ecole hoteliere de Lausanne (EHL)· 3 September 2018
Celebrity chefs are 'very expensive' but they can bring instant brand recognition to your hotel restaurant. That was the general consensus among panelists at the F&B breakout session at the International Hotel Investment Forum held recently in Berlin.

Frugal Innovation in Hospitality: Insights From Navi Radjou

Ecole hoteliere de Lausanne (EHL)· 3 September 2018
How can we, as an industry, do more with less? That's a challenge more and more companies are facing nowadays. It's also a conundrum posed by frugal innovation which seeks to deliver products and services that are not only affordable but also sustainable.

INTERVIEW - How can Google Help Hoteliers? with Philip Reis, Hospitality Industry Leader, Google Switzerland

Ecole hoteliere de Lausanne (EHL)· 3 September 2018
We spoke recently to Philipp Ries, Industry Leader for hospitality at Google in Switzerland, after his recent keynote speech to EHL's international advisory board. Here are edited highlights of the interview.

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