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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.

  • What to Expect at HITEC Houston 2018: Elite Education, Exhibits, E20X and More

    HOUSTON: A booming cosmopolitan city that is home to more than 2 million Texans, NASA’s famous Johnson Space Center, and — in just two short months — the world’s largest hospitality exhibition HITEC®.

  • 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.

The Integrated Revenue Generation Team - Coming Soon to Your Hotel!

EHL · 4 June 2018
One of these trends is related to net room revenue - that is, revenue that remains with the hotel after accounting for distribution costs (online and traditional agency commissions and other expenses).Net room revenue has been declining steadily over the past several years. For instance, US hotels earned roughly $155.2 billion in guest-paid revenue in 2017 but paid an estimated $25.2 billion to acquire guests in the form of OTA commissions and other distribution costs, retaining significantly lower net room revenue of $130 billion (Kalibri Labs).The overall growth in occupancy and revenue per available room (RevPAR) that many hoteliers have been enjoying for some time now cannot possibly compensate for 'the loss of wealth' through steadily increasing OTA distribution costs. Obviously, hoteliers need to increase direct bookings, which come at a much lower cost, and improve the overall direct vs OTA distribution ratio.Integrated strategy: The missing piece of the puzzleOne of the main reasons for the troubling trend of decreased revenue capture and profitability, despite stellar economic performance is the lack of integration, coordination, and singular focus and purpose among the core revenue generation teams at the property or hotel management company: namely, the revenue management (RM), sales and marketing (S&M), marketing, and customer relationship management (CRM) teams.Quite often these teams function in a rather disjointed fashion, leading to missed revenue opportunities, over-dependency on the OTAs, alienated loyalty members, and lower profitability.Often the RM, S&M and CRM teams in a property operate in isolation from one another, without close coordination. In some cases, they even compete with one another to sell the same rooms. In other words, the left hand - one team - does not know what the right hand - the other teams - is doing, to the detriment of marketing efficiency and price integrity, and ultimately overall revenue generation, profitability, and the owner's return on investment (ROI).The reality: highly fragmented hospitalityTraditionally, RM, S&M and CRM operate as separate teams with their own goals, technology tools, databases, vendors, and more.One glaring example of this highly fragmented approach is keeping past guest engagement efforts (CRM) in a silo from new customer acquisition and marketing efforts.For example, looking at independent hotels, less than a third of hotel guests on any given night are repeat guests, while two-thirds are first-time guests.This means that the reality general managers and directors of sales and marketing (DOSMs) face every day is having to fill about 70 percent of their rooms on any given night with brand new guests that they know very little about, while trying to ensure they have a pleasant and meaningful stay.Furthermore, once the property has acquired these new guests, when they walk out the door, if they're not engaged with marketing automation and guest retention initiatives, there is no guarantee they will ever stay at the property again. This results in a vicious cycle that affects the bottom line.Dr. Cindy Heo, an associate professor of revenue management at Ecole hoteliere de Lausanne (EHL), describes the current siloed approach in revenue management and the existing fragmented customer data situation in the industry:Revenue management used to focus primarily on setting room prices and optimizing room inventory. Revenue managers should not just crunch RMS numbers but need to understand guests' selection behavior, consumer psychology, and their competitors' strategies by analyzing various pieces of information. RMS cannot, therefore, be the only toolkit for a revenue manager, because customer data reside in different hotel systems.Tying RM, S&M and CRM together with a 360-degree approach that engages, retains, and acquires guests throughout the customer journey is not only more efficient and more effective at driving direct bookings, but it is critical in growing the bond with your customers and their lifetime value.Obviously there is a need to break down silosToday's travel consumer's hotel planning and booking journey has become increasingly complex in this multi-device, multi-channel, and multi-touch point digital landscape.As consumers remain digitally-connected throughout these micro-moments before making a booking, each touchpoint presents an opportunity for a hotel to build a brand connection, influence intent, win the booking, and be there for every step of the journey.In light of this complex digital landscape, hotel marketers should engage online travel consumers throughout their complex digital journey and can no longer afford to have a fragmented customer engagement and acquisition approach.To summarize, here are the main reasons prompting the convergence of RM, SM and CRM into one cohesive team:The overwhelming shift to online distribution and online customer engagementsExploding mobile channels and the need for lightning-fast pricing and marketing decisionsThe ever-increasing complexity of the customer lifecycle and the emergence of the digitally-savvy travel consumer.The need to lessen overdependence on the OTAs.The solution: The integrated revenue generation teamThere should be a single-minded team at the property: the revenue generation team, consisting of RM, S&M and CRM specialists working together to acquire, engage, and retain guests; optimize performance; and increase revenues, especially direct bookings.What then should hoteliers do to accelerate the switch to an integrated revenue generation team? Here are just a few of the changes and action steps needed:#1 - Hotel management and franchise contracts:Management and franchise contracts should use total gross operating profit (after OTA commissions, traditional agency commissions, and other distribution expenses) and not gross room revenues to calculate management and franchise fees.In this way, every revenue-generating employee and team at the property would be evaluated based on net room revenues collected by the property (gross room revenue minus agency/OTA commissions).#2 - Organizational changes:A new role is needed at the property or hotel management company: that of revenue officer or revenue optimization officer, overseeing the integrated revenue generation department at the property, small or midsize chain, or hotel management company. The revenue optimization officer is not an accounting or finance major position, but a role for a cross-functional leader, versed in all three disciplines: RM, S&M and CRM.#3 - Education and professional development:The whole hospitality educational and professional development system needs to be re-thought and adjusted to create cross-functional experts who are intimately familiar with all three disciplines: RM, S&M and CRM. Existing RM, S&M and CRM employees should be incentivized to get certifications and attend professional development courses in the other disciplines as a prerequisite for their career advancement.#4 - Technology investments:Hotels need to invest in technology that allows alignment of, and cooperation among, the RM, S&M and CRM specialists from the revenue generation team. This is a call to action for the hotel tech community: new technology tools and platforms, especially platforms utilizing AI to crunch big data, are urgently needed to enable the cross-functional, cross-data alignment among RM, S&M and CRM.The independent property, small or mid-size hotel brand can start small by working with existing vendors on cross-functional connectivity, or when considering new technology solutions, to evaluate the cross-functional capabilities of the vendors. Hoteliers should ask themselves, "How can we incorporate our digital marketing and CRM data into our pricing decisions? How can we use revenue management analytics to sharpen the focus and ROI of our digital marketing campaigns? How can we utilize our knowledge from our RFM data into our new guest acquisition efforts?"#5 - Revenue optimization ideationThe revenue generation team and its RM, SM and CRM specialists, under the guidance of the revenue officer, should map out an annual revenue strategy, outlining major markets that need focus or improvement, sales, and marketing (seasonal, multichannel, ad hoc) campaigns needed to achieve the revenue goals, etc.Each quarter, the team should brainstorm and come up with an updated action plan for the next three quarters. Every week the team should meet to discuss current property performance - including occupancy, ADR (average daily rate), RevPAR, and revenue needs - and set out concrete tactics to optimize revenue.#6 - Optimization of the marketing mix:An integrated revenue generation team can finally achieve the elusive optimization of the property's marketing mix of price, product, promotion, and place. Only by working together can the team devise the optimum pricing, product offering, and distribution channel strategy that can bring the best results.There should be collaboration when answering questions such as: should we offer the spring multi-channel marketing promotion to the OTAs? How do we tackle next month's occupancy needs due to group cancelation? How do we improve weekend occupancy? Through this collaboration, action plans can be implemented across all revenue-generating channels.#7 - Personalization:Personalization is not only proven to increase bookings and other key performance indicators, consumers now expect hotel offerings, pricing, and content (textual and visual) to be personalized to their needs and preferences. A recent survey by eMarketer showed that 85 percent of internet users expect personalization, and 75 percent of consumers get frustrated when it's clear that companies are not personalizing content (Janrain).The revenue generation team can devise a robust personalization strategy that includes all aspects of the guest journey: from marketing and website engagements, pricing and channel management, personalized offering and pricing based on RFM and customer lifetime or LTV values, to product offerings and CRM retention and loyalty marketing initiatives.#8 - Multi-channel marketingThe revenue generation team should coordinate marketing efforts using a multi-channel marketing approach. With one cohesive marketing campaign, and the same cohesive marketing message (read: promotion) pushed across all potential touch points with online travel consumers (hotel website, SEO, SEM, GDN and online media, social media, PR and email marketing), hoteliers can build stickiness and traction across channels and devices and dramatically increase revenue.Today's complex multi-touch consumer behavior is what makes multi-channel marketing campaigns the most effective way to address concrete business needs, increase reach, and boost bookings and revenue for the slow season or need period.These campaigns can be structured around the property's seasonality as well as specific business-needs (i.e., need to fill weekdays vs. weekends, occupancy needs, group cancelations, seasonal slowdowns, etc.), and also target specific high-value segments.ConclusionThere is no doubt that today's complex travel customer journey requires an integrated strategy to engage, acquire, service, and retain travel consumers across multiple digital touch points and across all digital channels and devices. This necessitates a single-minded team at the property: the revenue generation team, consisting of the RM, S&M and CRM specialists, working together to acquire, engage, and retain guests; optimize performance; and increase revenue, especially direct bookings.There are no perfect solutions in existence today, therefore hoteliers should start with contractual and organizational changes, with close collaboration and alignment of business objectives and marketing plans across revenue generation teams, as well as make use of cross-functional technology solutions available today and invest in new and emerging solutions as they become available.

STR: For Hotels, China's Best Year in Recent History

EHL · 1 June 2018
Looking at supply development, China's second-tier cities are seeing higher rates of growth than the first-tier cities. This has brought both opportunities and challenges for markets like Xi'an, Hangzhou, Tianjin, Wuhan and Dalian, which have seen rate declines over the past few years. Thanks to a boom in leisure domestic travel, these markets saw growth in both occupancy and rates.Hangzhou's year-on-year performance levels were impacted slightly following the G20 summit in September 2016, but recovery was quite quick thanks to the Chinese New Year and summer holidays. Leisure and corporate demand levels are on a steady track throughout most of the country. After struggling from substantial supply growth in recent years, some markets in western China, such as Xi'an and Chengdu, posted strong occupancy levels in 2017 - with Xi'an coming in the top five major Chinese markets in terms of occupancy growth.Among the top-tier cities, Shenzhen recorded the highest actual occupancy level (85 percent), followed by Shanghai. ADR growth was also strong in these markets, with a number of new notable attractions in Shanghai, such as the Disneyland resort that opened in the summer of 2016 and the new National Exhibition and Convention Center at Hongqiao International Airport. Although Beijing is falling slightly behind, the capital's hotels recorded their best summer since 2009, the year after hosting the Summer Olympics.Looking ahead, hotel operators will likely focus on driving ADR to bring up their gross operating profits or GOPs.This article was originally published in STR's Global Hotel Study, a comprehensive overview of the hospitality industry covering over 100 markets worldwide.

How Halal Tourism is Reshaping the Global Tourism Industry

EHL · 1 June 2018
Spending by Muslim travelers is expected to rise to US$220 billion by 2020, with the number of Muslim tourists growing to 156 million from 121 million in 2016. That's according to the Global Muslim Travel Index (GTMI) 2017, which was produced by Mastercard and CrescentRating, a 'halal-friendly' travel consultancy.'Halal' tourism is clearly a growing market segment, with Muslim tourists seeking destinations which meet their needs, in terms of diet, dress or rituals. Translated from Arabic, 'halal' means permissible in accordance with Islamic teaching. Alcohol, pork, nudity and gambling are off limits.With a burgeoning middle class and increasing disposable income, many countries - whether Muslim or not - are looking to attract these travelers. Malaysia, the United Arab Emirates, Indonesia and Turkey are among the leading Muslim destinations. Singapore, Thailand and the United Kingdom are among the top non-Islamic or OIC (Organization of the Islamic Conference) destinations.Despite being a predominantly Buddhist country, albeit with a sizeable Muslim population in the south, Thailand has proved to be a popular destination for Muslims, mainly from Indonesia looking for affordable vacations and Thai food. As for the UK, Muslim spending is expected to rise to US$4.1 billion by 2020 even though there has been a spike in Islamophobic assaults following recent terror attacks in London and Manchester.Adapting to the needs of Muslim travelersGiven the potential of this sector, it's important for the hospitality industry to adapt to changing halal requirements to meet the needs of Muslim tourists. According to CrescentRating, hotels and restaurants should offer halal food at the very least. A destination is then seen as increasingly attractive for Muslim travelers - as assessed in the GTMI ranking - based on the availability of prayer facilities, Muslim-friendly washrooms and Ramadan-related offerings. While many airports are now offering halal food and prayer rooms, some still lack wash or ablution facilities.Shaping the future with technologyIn addition to more traditional online travel agencies or OTAs such as booking.com or TripAdvisor, Muslim-friendly platforms are springing up. Take for instance Halalbooking.com, a London-based market place for halal tourist accommodation that is expecting to achieve revenues of at least one billion pounds by the end of 2021.Peer-to-peer platforms are also emerging. Bookhalalhomes.com has become the world's leading portal for halal accommodation rentals. It differentiates itself from Airbnb by guaranteeing halal-certified services such as halal food and designated prayer rooms.Smartphone apps are also being developed. The Tourism Authority of Thailand has launched an app that helps Muslim travelers find halal products and services. It provides information about prayer times, food options and sightseeing tours. Another app, HalalTrip, offers information related to more than 65 destinations worldwide. It generates revenue by selling suitable tour packages, whether it's experiencing Great White Sharks in South Africa, culture and history in Spain, or shopping in Dubai.Compared to more established western OTAs though, halal tourism e-commerce is still in its infancy. As we've outlined, however, it's a growing market that needs to be served. Technology will continue to shape the growth of the sector by allowing hoteliers, restaurateurs and others to demonstrate that they are sensitive to halal requirements.How innovation affects demandWith spending by Muslim travelers on course to reach US$220 billion by 2020, and Islam the fastest-growing religion in the world, Muslim tourists are definitely some of the most important customers in the travel market.Pull factors such as family-friendly and Muslim-friendly services are important, as is halal awareness. Where safety concerns and basic halal requirements are met, Muslim tourism will continue to grow.As for technology, halal tech firms appear to have established a first-mover advantage. But it's only a matter of time before major western OTAs enter and seek to dominate this promising market.

GDPR: Why Hoteliers Should Take the new EU Regulations Very Seriously

EHL ·31 May 2018
New EU rules on data protection - or GDPR - , seven years in the making, come/came into effect on May 25. The advice from IT experts to hoteliers is: take the new rules very seriously or risk heavy fines of up to 20 million euros or four percent of the company's global turnover, whichever is higher.At the recent Young Hoteliers Summit, staged at Ecole hoteliere de Lausanne, Nick Price, CEO of NetSys Technology and CIO of citizenM Hotels, touched on the challenges posed in a keynote address.He said the new General Data Protection Regulation or GDPR was significant as the hospitality industry holds a lot of data which are spread over many different operational systems.In a panel discussion on the future of technology in hospitality after the keynote, he cautioned young hoteliers that their careers in the hospitality industry could end abruptly if they were responsible for a breach.It's criminal law. You can be fined significantly. Understand that the brand will be impacted, not you, the hotel. If your hotel loses some data, you've most likely given access to all your company's data, given how things are interconnected today. Be aware, this is very real.Another panelist, entrepreneur Uli Pillau, founder of tech firm Apaleo, said GDPR wasn't taken seriously enough, as had happened with Payment Card Industry (PCI) compliance. "This is a new topic for the industry and very few people understand what it means. There are big risks with that, but the earlier people take it seriously, the better. And I don't see too many hotel groups and hotels which are really taking it very seriously at this point""Europe has a very different perspective on individual citizens' data than the United States, for example, and these laws are a response to that," Price said during the panel discussion. "You can expect some fairly significant case law established from May when this law becomes enacted Europe-wide and some companies lose this information. With GDPR, European laws will apply and they will fine these companies serious, big money."And his advice to the young hoteliers: "Just sit back and think where customer information is actually held, in which systems in the hotel and how many systems duplicate that information. Imagine how you would collate that knowledge and protect that information in those operational systems, some of which are decades old."Pillau pointed out that legacy systems represent a 'high risk factor'. "The safest way to go is to use token technology which encrypts it entirely, (so that) at the PMS (property management system) or at the hotel level no data is kept which could get outside the systems. I think there are intelligent ways of doing that today."Suzanne Ward, Director of Digital Solutions at Movenpick Hotels & Resorts, noted that not only the data of customers should be protected, but also employee data such as payroll or HR information. "We need to be extremely careful with that sort of data too."Price told Hospitality Insights on the sidelines of the YHS forum that the new rules were 'serious' but would also be beneficial. "This is a good thing as it protects fundamental information about human beings from misuse. We have customers who stay with us and because of the nature of our business as hoteliers, we have to capture information."We have a trusted relationship with these people. They trust us with their safety when they're in our hotels. In order to have that trusted relationship, we have to be able to demonstrate we can protect the information they voluntarily give us and that's quite challenging. But frankly speaking, (the GDPR) should be welcomed by the hotel industry and it's here for a good reason.European governments have recognized, he said, that many companies nowadays are "deriving a lot of value" from the use of customer information."We, as hoteliers, also need to derive value from that information. We need to be part of that same business model," noting that Google and Amazon make money out of personal information and their valuations are 'significant.'Hotel companies should also be able to make money out of the information but in order to do that, they have to be trusted with the information in the first place and they have to give a net beneficial return to the customer that stays with them, which they can do. They're uniquely positioned to do that."But it begins with trust and you can't be trusted as a hotelier by your customer base, if you don't protect really what is in many senses the most valuable data you have, which is the information (you hold) about that customer. So yes, it's a good thing."

4 Reputation Management Challenges Every Hotel Manager Faces

EHL ·30 May 2018
But what exactly is the impact of guest evaluations on a hotel's performance? How do hotel managers cope with negative online reviews? And what are the main challenges they face in improving their results?Our latest research examines these questions based on a survey of international hotel managers to understand their perspectives on online reputation and manipulation.Key Highlights :Guests are increasingly aware of the importance of reviews and their power over reputation.Ratings, ranking positions and new market entries increase pressure on managers.Strategies employed to improve online reputation are often outside the control of platforms.The extent of manipulation appears to vary between individual businesses and countries.Interviewed managers confirm growing competition as a result of ratings and rankings, and they report that guests are increasingly aware of the importance of reviews. To avert negative online feedback impacts, managers intervene strategically. They report - irrespective of hotel standard - to pay close attention to online reputation, and to engage in various strategies to maintain or improve their ratings or ranking position. Specifically, our research reveals four core challenges directly related to online reviews and ratings of accommodations.Challenge #1: Consumer judgement culture not only encourages, it demands opinion.The results have a persuasive power in influencing customer perceptions and choices, and on business behavior. In particular, negative reviews appear to be considered useful by consumers. The emergent consumer judgement culture and consumer citizenship increase pressure on management.Moreover, while prospective hotel guests will be aware of the importance of credibility, also having learned to interpret reviews, there is nevertheless evidence of reputation 'thresholds'; this is, minimum ratings or ranking positions that are specifically attractive or no longer attractive to customers. These behaviors stand irrespective of whether review content is credible and if service quality of an accommodation business may change over time (for instance, when owners change, after renovations, or because of new service offers).Challenge #2: Market dominance of selected platforms, including Orbitz, Travelocity or Booking.com, can be problematic where a business' reputation depends on one or a few platforms.For example, by September 2017, Travelocity reported having stored 535 million reviews covering over four million accommodations, restaurants, attractions, resorts and destinations.These figures mirror the considerable importance of platforms for information collection, usually before reservations are made.Concentration also means that the online reputation of millions of small- and medium-sized enterprises, larger hotels and entire destinations throughout the world is now controlled by global corporate stakeholders.The emergence of a near market-monopoly of a few selected platforms for reservations (Booking) and recommendations (TripAdvisor) has initiated processes that pose a significant problem for the hospitality industry. These problems are poised to become more prevalent, as market concentration continues and guest awareness increases.Challenge #3: New market pressures force managers not only to improve customer relations and brand relationships; but also to deal with online reputation and manipulation, i.e. activities designed to control opinion to one's own advantage.Manipulation can be complex, comprising strategies to involve staff, friends, bloggers or other parties.Many of these strategies must be considered problematic from legal or ethical viewpoints, as they involve the soliciting of reviews from guests, friends and acquaintances or staff; the invitation of bloggers; or the use of commercial raters, a strategy used by about a third of managers.Challenge #4: Addressing legal disparities is complex as laws with respect to defamation vary according to jurisdiction not just in relation to what constitutes defamation but also whether publishers and/or persons are liable.Rating culture, most widely observed in the form of Facebook 'likes', has profoundly changed the character of customer-hotel interactions.To be able to rate, judge and evaluate is a form of empowerment that affects reflection and empathy: Few guests will consider the implications of a negative review posted in a situation of momentary discontent, for example.As critical guests are simultaneously treated with respect, deference and privilege, opportunities to evaluate generate a sense of entitlement and self-importance.A set of specific responses are derived from the study and include, the emerging importance of reputation management strategy.Online reputation management has become a key asset for most hotels. Guests appear to become increasingly aware of their influence over reputation, and the importance of positive reviews. This is a process fostered by managers anxious over reputation, who may pamper in particular already critical guests. Guest expectations and additional service offers stimulate each other, ultimately working to the disadvantage of businesses.Meantime, hotels still need to offset critical reviews. The use of strategies to reduce negative content posted on platforms is thus an important aspect of reputation management.Specific practices, including linguistic cues, can be used to distinguish manipulated/authentic reviews, though it is generally difficult for individual hotels to control who posted online content or to demand the removal of specific comments, even if these are evidently false.More generally, there are opportunities for legal redress. Negative online reviews can potentially become a point of legal action for a hotel if it is regarded as defamatory and/or comments are not taken down when requested. Nevertheless, this creates further legal cases and costs for accommodation providers, one to obtain evidence of the identity of the person who posted the review and the other by way of defamation. Any legal action is likely to be expensive suggesting that such measures will usually fall outside of the capacities of many hotel SMEs.To conclude, two projected scenarios concerning the future of online reviews are depicted.One is that market concentration continues, and that platforms will implement protocols and algorithms to make it more difficult to post 'false' or manipulated opinion. This, however, already proves to be difficult, and there is little pressure on platforms to remove false content given limited options for SMEs to seek legal redress.Another scenario is that hotels start to realize they are potentially better off without globally managed platforms. It is not unthinkable for entire countries to shun specific platforms; for businesses to find their own, decentralized marketing channels or for new relationship marketing strategies to be developed, particular with established customer bases.About the ResearchOur research presents the results of a survey including 270 hotel managers in five countries - Germany, Israel, Norway, Sweden and Switzerland. This is the first quantitative academic study of manager perspectives on hotel online reputation and manipulation.Our study is the result of a multidisciplinary research team, comprising:Stefan Gossling (Linnaeus University and Lund University in SwedenHarald Zeiss (Harz University of Applied Sciences in Germany),Michael Hall (University of Canterbury in New Zealand),Carlos Martin-Rios (Ecole hoteliere de Lausanne),Yael Ram (Ashkelon Academic College, Israel)Ivar-Petter Grotte (Western Norway Research Institute).

Is an Entrepreneurial Ecosystem Beneficial for Startups?

EHL ·29 May 2018
Innovation and entrepreneurship are clearly flourishing in Switzerland if the from Seedstars, a concept born in Switzerland bringing together investors, educators and innovators for emerging markets; Edouard Treccani from MassChallenge, a worldwide start-up friendly accelerator with emphasis on early entrepreneurs; and Karim-Paul Chibb, an EHL alumnus and the founder of Campus, a vibrant co-working space and start-up coach.Lausanne's ecosystem is something of a hidden gem as it offers entrepreneurs a range of services, network partners, and a state-of-the-art support-system. However, does mere availability of such resources mean entrepreneurs are able to benefit effectively from the ecosystem?According to an article on 'How to Start an Entrepreneurial Revolution', published in the Harvard Business Review several years ago, entrepreneurs are most successful when they have access to the human, financial and professional resources they need.More crucial though are government policies aimed at encouraging and safeguarding entrepreneurs, as well as support networks of entrepreneurs and experienced business leaders who may be able to provide advice on tackling some of the challenges they're facing - particularly if they themselves have experienced similar obstacles in the past.Such networking opportunities clearly bring benefits. Through events and activities, the ecosystem enhances the chances of meeting like-minded entrepreneurs, potential investors, as well as suppliers and partners. For young entrepreneurs starting out in hospitality-related industries, an ecosystem can provide access to customized financial, legal or IT solutions.However, it's easy to misjudge the value of an entrepreneurial ecosystem if we just focus on the number of start-ups in an area or the amount of available funding as indicators of the chances of ventures not only surviving but thriving.Unfortunately, research shows that simply creating opportunities to raise funds or meet other entrepreneurs and business leaders is not enough. What then makes an ecosystem strong and sustainable?Collaboration with other start-ups, the ability to share the experiences of successful companies in the industry, training, and transparent access to resources are among the elements that will produce an effective ecosystem.According to Seedstars, the challenges facing entrepreneurs are more apparent in emerging markets. Along with financial resources and professional mentorship, entrepreneurs seeking to make a difference in their societies also require basic facilities such as co-working spaces.For instance, Seedstars recently built a number of co-working and co-living spaces for Latin American entrepreneurs.Laure de Peretti told the panel session that, having got seed capital, some of these entrepreneurs also needed an adequate place to develop their ideas, which - without Seedstars - they could not easily afford. She also highlighted that leapfrogging is a common practice in emerging markets, making access to the resources available in the ecosystem difficult for entrepreneurs.The way we see it is that you have the culture in an ecosystem, the environment, and the opportunity. These are the three big pillars. It's not only the people in it, or the structure, it's also the culture. - Laure de Peretti, Seedstars."In emerging markets you have leapfrogging, which is huge in the culture of emerging markets. It's jumping from one industry to another one super quickly." For example, she said, some villages in Africa had moved to solar kits from using gas or fire as an energy source, instead of switching to electricity.And the verdict? The panelists all agreed that the ecosystem is a necessary, but insufficient condition for success.It's up to the founders of start-ups to take the initiative and branch out and activate the networks they are part of. That's because they often spend more time and money, and hire more employees than necessary, mainly because they are unaware of what is available elsewhere. While the lean start-up movement is now about a decade old, we still find today that many founding teams don't take the time to seek the support they need to reduce costs, provide seed funding, or access to crucial knowledge.Interestingly, according to Laure de Peretti, the more difficult the environment - as experienced by some of the founders in her portfolio - the more successful they are in making use of the ecosystem. That said, entrepreneurs in places like Lausanne and Switzerland should take full advantage of all the available infrastructure on offer to access training, nurture their networks, and collaborate with other founders - who are, more often than not, facing similar issues.
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GDPR: Why Hoteliers Should Take the new EU Regulations Very Seriously

Ecole hoteliere de Lausanne (EHL)·29 May 2018
New EU rules on data protection - or GDPR - , seven years in the making, come/came into effect on May 25. The advice from IT experts to hoteliers is: take the new rules very seriously or risk heavy fines of up to 20 million euros or four percent of the company’s global turnover, whichever is higher. At the recent Young Hoteliers Summit, staged at Ecole hôteliere de Lausanne, Nick Price, CEO of NetSys Technology and CIO of citizenM Hotels, touched on the challenges posed in a keynote address.

2018 Compilation: Best Hotel Management School Rankings

EHL ·23 May 2018
When you are deciding which undergraduate or graduate hospitality degree program to attend, rankings can help you compare different programs that have caught your eye. We compiled the best hotel management school rankings out there.So, what are best universities for hospitality and tourism management in the world? The ranking methodologies vary, but EHL is the only university present in the top 5 across all rankings.Eduniversal Best Masters Ranking 2017Eduniversal classifies and highlights Masters programs which prepare and graduate the most competent students into the global workforce based on the following criteria:The reputation of the program based on the opinions of recruiters and the level of "Palme of Excellence" of the schoolThe salary of the 1st employment weighted by country and by the average annual salary of its executivesThe students satisfactionThe different nationalities registered in its programsThe possibility for graduates to do an internship or to work abroadThe students work experienceThe availability of distance learningWhat are the best hospitality management masters?Cornell UniversityEcole hoteliere de Lausanne / Hong Kong Polytechnic University / University of HoustonESSECErasmus UniversityEM Lyon / Paul BocuseCEO World Magazine, 2017The CEOWORLD magazine's hotranking is unique among international higher education institution surveys as it evaluates schools in terms of the full scope of their missions, including:Global reputation and influenceRecruiter feedbackJob placement rateAdmission eligibilitySpecializationAcademic reputationPeer ranking from senior scholars in over 52 countriesWhat are the best hospitality and hotel management schools in the world?Cornell UniversityUniversity of Central Florida (UCF)University of Nevada - Las Vegas (UNLV)Ecole hoteliere de LausanneMichigan State UniversityHospitalitymanagementdegrees.net 2017The Hospitality Management Degrees ranking considers hospitality schools and departments that stand out as leaders in the field, that influence the international hospitality industry through their graduates and research, and that will continue to shape the hospitality industry moving forward.This ranking's results focuses on several major criteria:Academic ReputationEmployer ReputationInternational Student ScorePercentage of International StudentsWhat are the most prestigious hospitality management departments in the world?Hong Kong Polytechnic UniversityEcole hoteliere de LausanneLes RochesUniversity of QueenslandUniversity of SurreyEducations.com 2017Major educational website Educations.com ranks universities based on a variety of qualitative factors:The percentage of international students enrolled in the universityThe services provided to students before, during, and after their studies (internship availability and extra-curricular)The global and national rankings of the universityThe popularity of the study abroad destinationThe openness of the host-country to international students (ease of application to student visas)The student reviews as well as private evaluations emailed to educations.comThe percentage of employment of international students after graduationThe importance placed on programs to prepare students for an increasingly changing worldWhat are the top 5 universities to study hotel management?Cornell UniversityEcole hoteliere de LausanneUniversity of Nevada - Las Vegas (UNLV)University of Central Florida (UCF)Oxford BrookesQS world university rankings 2018QS Top Universities, the higher education data specialist evaluates yearly hospitality and leisure management schools in the world according to the following six metrics:Academic ReputationEmployer ReputationFaculty/Student RatioCitations per facultyInternational Faculty RatioInternational Student RatioWhat are the top hospitality and leisure management schools in the world?University of Nevada - Las Vegas (UNLV)Ecole hoteliere de LausanneHong Kong Polytechnic UniversityUniversity of SurreyGlion Institute of Higher EducationWhy is EHL among the top hospitality schools in the world?Here are some of the reasons why all the major ranking systems giving EHL top honors:EHL's strong academic curriculum coupled with real-life practical education creates versatile hospitality professionals - the secret sauce to a long-lasting career in hospitalityEHL's reputation for excellence means graduates receive fast placement in top-tier positionsEHL combines a truly international outlook (over 100 nationalities on campus), with the strong traditions of Swiss hospitalityEHL collaborates with its extensive industry network to invent the future of hospitality

Corporate Governance: Why Independent Audit Committees Matter

EHL ·15 May 2018
Since 2000, the audit committee has been put forward as an effective mechanism to limit fraudulent financial reporting. Following financial scandals such as Enron and WorldCom, the US Congress issued the Sarbanes-Oxley Act (SOX) in 2002 to protect investors by improving the accuracy and reliability of corporate disclosures.Sarbanes-Oxley requires publicly traded companies to have:the CEO and CFO certifying the financial statements;an effective internal control system put in place and maintained;an audit committee in charge of the oversight of the financial reporting process and of the engagement of the external auditor. The audit committee must be wholly composed of independent members sitting on the board of directors.In Europe, the audit committee's composition rule is different. The European Commission (EC) mandated in 2006 that each 'public-interest entity' should have an audit committee with at least one independent member. In 2014, the EC amended this regulation by mandating companies should be at least 50 percent comprised of independent members.In a recent article in the Journal of Accounting Literature, we examine whether the percentage of independent members sitting on audit committees, in different institutional settings, has an impact on the credibility of earnings.For this study, we examined a large sample of 7,656 earnings announcements by 1,420 listed companies in 15 European countries during the period 2006-2014.To measure the strength of the institutional setting, we used an index developed by Brown et al. (2014), which - in our view - is able to explain differences in earnings management across countries.We also used the World Bank's Governance Indicators to control for potential limitations of the index.Our key findings were as follows:Stock market reaction to earnings announcements is greater when firms have more independent members sitting on the audit committee;The percentage of independent members sitting on the audit committee very significantly affects investors' reaction in countries with weaker legal protection of shareholders' interests (i.e. weak institutional setting), but not in the case of stronger legal protection.Thus, our results suggest that the institutional setting does have an impact on the effectiveness of the audit committee. In weak institutional contexts, managers have more incentives to distort financial information to acquire private benefits, and investors may therefore rely on the independence of the audit committee to assess the credibility of earnings.Overall, by highlighting the impact of the institutional context on the independence of the audit committee, our results are particularly interesting for European regulators. They should also be interesting for boards of directors, which are in charge of the oversight of the financial reporting.As for the hospitality industry in Europe, we would encourage boards of listed hotel firms to opt for fully independent audit committees.Access the full study:Audit committees' independence and the information content of earnings announcements in Western Europe. Journal of Accounting Literature. Poretti, C., Schatt, A., & Bruynseels, L. (2018).

What's the Value of Hotel Loyalty Programs?

EHL ·14 May 2018
At the recent Young Hoteliers Summit staged at EHL, loyalty programs came under the spotlight during a panel session focusing on the luxury sector.Dorchester Collection is one of a number of upmarket brands which do not offer loyalty programs to guests. Instead, they offer loyalty programs to travel agents.I don't believe too much in loyalty, to be honest," said Chief Operating Officer Francois Delahaye. A guest might go to a certain hotel in one city with his wife, go somewhere else with his mother, and then take his children to another destination. Very rich people ... want to say, what's new in London? They need to have experiences. So the loyalty isn't there anymore. Giving them points to make sure they'll come back, is a way of insulting them."I don't want to insult my guests," Delahaye said. "I want to make sure we do everything (in terms of) the experience in our restaurants and bars, to make sure that, when they go to another place, they'll remember how good it was at Dorchester Collection."A student delegate queried his view, saying Delahaye had shaken her world as she had previously worked for the Marriott group.Delahaye didn't pull any punches. Guests may be loyal to your brand when traveling on business, he said, but when they go on vacation "they abuse the system.""They want to be in a suite but don't want to pay for it and they abuse the system because your investors (put their money) into those beautiful junior suites and they need to have a return. We're in a commercial business, we need to give to our owners the returns they deserve."Jurgen Amerstorfer, the GM of the Edition London, which is one of the Marriott's 30 brands, came to the defence of loyalty programs.He said he could understand Delahaye's position, agreeing that investors are seeking returns. However, he said, hotels do get reimbursed if points are used by guests.Because the hotel is charged for any points you accumulate, there's a fund - a 'pot', if you wish - and the hotel where the guest stays and uses the points, gets reimbursed. Real freebies, unfortunately, even in the world of hospitality, are not happening. So that's the bad news maybe.In separate interviews with Hospitality Insights on the sidelines of the Young Hoteliers Summit, the two senior executives elaborated further."All the airlines went on the (loyalty) route and it cost them a fortune," said Delahaye. "I don't see how we can be so arrogant to think our guests will be purchased, attracted by points. What they're looking for is recognition, some present they need, but not points.""That's good for the corporate market, it's perfect for them, but for us, I don't think so ... For our clients, we have so much respect for them that we don't want to have the arrogance of treating them like corporate people."Ammerstorfer also feels strongly about the issue: "It's an opportunity for us, as a hotel chain, to say thank you." Hotels, he pointed out, can also gain from loyalty programs through data mining. "The more data we have about you, the more we can really talk to you in a relevant way. And any company that doesn't do this and utilize the information they have, is losing out."So should your hotel offer a loyalty program or not?We asked Michael Levie, Chief Operations Officer at citizenM Hotels, for his views on whether loyalty programs are worth having. "They're a necessity for the brands because they're the only people they know and those are the only people they communicate with. That's their only lifeline left. All the other table silver(ware) has gone."Younger generations are more interested in recognition than points, Levie said. "I don't believe in frequent stay programs because basically it's legalized bribing. The real point hunters are out there but they're a dying breed."The 9th edition of the Young Hoteliers Summit was held at Ecole hoteliere de Lausanne March 12-14, 2018. Francois Delahaye of Dorchester Collection and Jurgen Amerstorfer of Edition took part in a panel discussion on 'Redefining Luxury in the age of the Millennial'. Michael Levie of citizenM gave a keynote speech at the conference.

How Much of a Threat to Hotels is Airbnb?

EHL ·11 May 2018
In our recent publication in the International Journal of Hospitality Management, we examined how Airbnb supply, price, and perceived quality affect the sales performance of incumbent hotels in the San Francisco market. In particular, we explored the impact of the development of Airbnb supply and users' satisfaction on hotel sales patterns, and whether different hotel segments have been affected by Airbnb's entry.Our methodologyIn conducting this research, we estimated a series of mixed models on data collected from 101 hotels in San Francisco neighborhoods. Our sample totaled 1,111 observations. In this analysis, we measured the trend of change in hotel sales performance as Airbnb developed its supply in the city.Our EHL partner, STR, anonymized data for the 101 hotels for the period December 2013 to February 2016. Hotels in the sample ranged from economy to luxury. We included in our study hotels' total revenues, total supply, number of rooms, years since opening, and renovation, as well as brand information. We also analyzed the impact of rates and customer satisfaction (a proxy for perceived benefits) on the pattern of RevPAR (revenue per available room).Our findingsOur analyses revealed that:Total Airbnb volume does not impact RevPar. Total Airbnb listings (i.e., total inventory) do not impact the growth trajectory of hotel RevPAR, which confirms the argument that Airbnb's offering a supplementary service. These results are also consistent with a 2017 report on the Airbnb effect in Boston, and with an STR 2017 study of 13 global markets.However,The average price of an Airbnb offer can have an impact on RevPAR. And that impact varies across different segments of the industry. Airbnb property prices had a positive effect on hotel RevPAR: the higher the price of the rentals posted on the platform, the higher the RevPAR of the hotels.Also,The increase in the quality of the Airbnb service has a direct adverse impact on hotel performance. The higher the average satisfaction score of an Airbnb property, the lower the RevPAR for the hotels in the sample. More specifically, every increase in the review score of an Airbnb property had a negative impact of -$25.54 on hotel RevPAR for hotels in the sample. Finally,This last effect varies across segments. Airbnb rental prices had an effect on hotels' RevPAR in the luxury segment, with an increase in RevPAR of $0.651 for every dollar increase in the average rental price of the Airbnb units.In conclusion:Not just a supplement: The study reveals that Airbnb's listings/offers do not merely supplement the lodging market, but rather show substitute characteristics in their long-term effects on hotel sales' patterns.Customers make comparisons : The effect of Airbnb on hotels sales is intricate, and appears to be based on customers' dynamic comparison of the price and value offered by the two products. The research results imply that guests do consider both products when booking rooms and compare the benefits of each through user reviews.Signs of disruption : The results provide empirical evidence that Airbnb will disrupt the hotel business, and that the more Airbnb users are satisfied with their experience, the more likely it is that demand for hotel rooms will decrease. Hotel managers therefore need to be aware of the level of service and price offered by Airbnb and other sharing platforms in their market. Airbnb offers in their locality can no longer be ignored and should be considered when developing revenue management strategies.Airbnb is slowly disrupting the lodging industry, going beyond the supplemental role claimed by its founders. The impact of the sharing economy is not related so much to the volume of the offers on the platform but rather on the pricing and price-to-value proposition as perceived by guests.Access the full study:Airbnb's effect on hotel sales growth, International Journal of Hospitality Management. Blal, I., Singal, M., & Tempal, J. (2018)

Accor Challenges EHL to Create F&B Concepts for New Luxury Hotels

EHL ·10 May 2018
In February 2018, Mr. Amir Nahai, CEO Food and Beverage for AccorHotels, put down a challenge for Ecole hoteliere de Lausanne (EHL) students: create an innovative future food and beverage experience for two of Accor's new luxury properties.As part of Dr. Marc Stierand's Creating the Food Service of the Future course at EHL, five teams of students competed to develop creative food and beverage concepts for Accor properties that will be opening in Paris and London. Mr. Nahai set the stage with Accor's Food and Beverage strategy and challenged the teams to create highly memorable F&B experience in the properties.Two teams focused on the Paris property, which will be the SO! Hotel located on the Champs-Elysees.One team developed a concept around the avant-garde, as Paris was at the forefront of the French movement. The team recommended a more experimental experience including a food lab, a bubble waffles restaurant and a 'No' bar concept - a space where drinks are available but it's not a real bar.The second team introduced a solution based on contrasts, for example, a black and white visual theme, or several sensory experiences in which the guests become part of the contrast and experience.The other three teams generated concepts for the London property, which will be a Raffles hotel in the former Old War Office building.One team's theme centered on the Thames River - with all its deep history and connection to London - by weaving the river theme throughout the hotel's food and beverage experience.A second team created a concept based on United People, United Cultures, which played on the rich, positive, multicultural traditions in the United Kingdom.The third, and winning team's theme was based on Timelessness: think classics like Chanel couture, a vintage Aston Martin car, or a fine Armani suit. They also played off the idea of Timelessness in terms of losing sense of time, or being so engrossed in your experience at the hotel that you forget about time altogether.Throughout the course, students worked to debate, develop and refine their concepts. An interim presentation to a team of judges served as a midway checkpoint on progress and methodology. Final Hollywood-style, multimedia presentations were delivered at the end of March for final judging, including with Mr. Nahai.Mr. Nahai was very impressed with the thought, energy and dedication the EHL teams exhibited while working on the challenge. He remarked:I was very interested in watching their thought processes to see how the students think critically to develop concepts and solve real business challenges. The multicultural makeup of the teams also led to richer and more dynamic solutions.EHL was excited to take on this creative project in close collaboration with AccorHotels, which includes among others the Raffles, Fairmont, Banyan Tree, Sofitel brands.

The Impact of Terror on Europe's Hotels

EHL ·10 May 2018
How have hotel markets in Europe reacted to terror attacks over the past three years? Tragically, Europe has endured multiple terrorist attacks in recent years. In the past 12 months alone, we've seen a shift in the way terror affects hotel performance, and this article will delve into how several markets reacted following attacks. (All figures are 12-month moving averages, indexed to the month prior to the terror attack unless otherwise stated.)We'll start by looking at France, which has endured several attacks over the past three years, most notably in Paris and Nice.The attacks at the Bataclan and across Paris on that horrific night in November 2015 had an immediate impact on hotel performance. This further exacerbated the declines that hotels had already been experiencing following the Charlie Hebdo attacks in January of the same year. Last November, RevPAR in Paris remained a full 11 percent lower than it was in October 2015.The Bastille Day attack in Nice in July 2016, which claimed 86 innocent lives, again caused RevPAR declines, although to a lesser extent than in Paris. Hotels in Nice took 14 months to recover from the attack and are now achieving a RevPAR higher than the month prior to the attack.In March 2016, Brussels hotels were already suffering due to the aforementioned atrocities in France. Then terror struck at Brussels Airport and Maalbeek metro station.Eleven months after these attacks, RevPAR had fallen 19 percent to 62.37 euros.Last November, RevPAR was still 7 percent lower than it was before the attacks.There were five separate terror attacks in Istanbul in 2016, along with the nightclub shooting on the first day of 2017. The city was also the center of a coup d'etat attempt in July 2016 and, for the purpose of analysis, performance has been indexed from that point.Istanbul has suffered the steepest RevPAR declines in Europe due to terrorism.By February 2017, RevPAR was down 27 percent at TRY144.87. Recovery has been rapid from this point, however, and RevPAR has since increased to TRY183.55.Attacks in 2017Since December 2016, when one of Berlin's Christmas markets was attacked, London (on two occasions), Manchester, and Barcelona have suffered terrorist atrocities. The impact on hotel performance, however, has been markedly different from those previously seen in Paris, Brussels, Nice and Istanbul.Only Manchester has seen a decline in RevPAR - by 1 percent - and this was driven solely by supply growth, up 4.8 per cent January-November 2017.Meanwhile, RevPAR increased in Berlin (+3%), London (+1%) and Barcelona (+3%) since each of their attacks.This is particularly impressive in London, as supply increased by 1.5 percent in the six months since the March attack.In Barcelona, however, the Catalan independence declaration sparked significant declines, with RevPAR down 12.5 percent in October.While it can be argued that the sophistication, or lack thereof, of a terror attack can have a bearing on visits to a city, there does appear to be a shift in traveler attitudes to cities that have been affected by terror. Travelers appear to have become more stoic in the face of terror and have accepted that, sadly, this is a danger that we face in our day-to-day lives, both now and for the foreseeable future.This article was originally published in STR's Global Hotel Study, a comprehensive overview of the hospitality industry covering over 100 markets worldwide.Global Hotel Study: 2017STR's Global Hotel Study gives an unprecedented, worldwide view of the hospitality industry. With detailed insights for more than 100 global markets, the report explores the highs, the lows, and the factors tipping the scale in each direction. Beyond the numbers, the greatest value of this report is that it ties together on-the-ground industry knowledge from STR experts located across 15 countries.For more information, click here.

Much Ado About Millennials and Hospitality

EHL ·10 May 2018
Go to a hospitality conference or forum these days and the topic of millennials is likely to crop up, and more so at the Young Hoteliers Summit staged recently at Ecole hoteliere de Lausanne. At the heart of the issue is a fundamental question for hoteliers.Should you be thinking of changing your offering substantially to cater for this digitally-savvy generation in their early 20s to mid-30s, and, if so, what are they looking for? Are luxury hotels too stuffy and will they need to have a major re-think?In retail, leading designer labels such as Gucci are going all-out to woo these customers, even though they risk losing some of their well-heeled, more mature consumers in the process.At the YHS, senior executives from Four Seasons, Dorchester Collection, Belmond and Edition discussed the issue at length in a panel session entitled Redefining Luxury in the age of the Millennial.At the start of the session, David Samson (AEHL, 2011), an Associate Director at Deloitte and an industry specialist in its Travel, Hospitality and Leisure (THL) advisory practice in London, set the scene.It's a hugely attractive market, two billion millennials globally, 60 percent of them living in Asia, with more than 400 million in India alone."They now have the highest spending power," Samson said, adding they are now the largest group of corporate travelers in absolute terms.But he cautioned: "They are notoriously disloyal and like to try new things," booking last-minute via online travel agents or OTAs. "They prioritize experiences over the hotel component of a trip and deeply care about meaningfulness and shared values of the companies they engage with."Although none of the panelists could be called a millennial, several did feel they shared at least some of their traits."People make the millennials sound like they come from a different planet, that they're not human beings," said Rami Sayess, Regional Vice President and General Manager with Four Seasons Hotels and Resorts."I really think it's about the mindset they represent and how they influence other generations. There are a lot of millennial wannabes.""From a behavioral perspective I think I'm a millennial myself," said Jurgen Ammerstorfer, General Manager of Edition London, as he feels he's 'super-curious.'Ammerstorfer told Hospitality Insights on the sidelines of the event that hotels "can't be, and shouldn't be, something for everybody. You should be everything for a small group and really cater to the needs of this particular group." Traditional, luxury hotels are 'more predictable' in their offerings, he said, whereas Edition's "focus is to tap into the experiential part of their stay."Edition is one of the Marriott's stable of 30 brands but its designer differentiation stems from Ian Schrager, the 'godfather' of nightclubs, discos and boutique hotels. "When the guests walk in (to the hotel), it's like "wow, this is awesome, fantastic. The music, the smell, the food. They interact with people and see people around them that they can relate to," Ammerstorfer said.Francois Delahaye, Chief Operating Officer of Dorchester Collection, which boasts hotels such as the Plaza Athenee and Le Meurice in Paris, says the group is focusing on creating trendy bars and introducing the latest technology."It's not a challenge for us," Delahaye told Hospitality Insights. "We have iconic hotels in iconic cities but we want to (attract) all the generations."The Dochester Collection is aiming to win over the hearts of the sons and daughters of the existing clientele. Delahaye muses that perhaps the 10-year old girl using the Athenee's ice-skating rink will come back to the hotel one day for her honeymoon. Innovation "will become tradition afterwards and then we will need again to reinvent ourselves. So modernity within the tradition is part of life."The Belmond group is also aiming to win over the hearts of the sons and daughters of their well-heeled clientele.Klaus Kabelitz, who will effectively have 'a white sheet of paper' when he opens the Belmond Cadogan Hotel in London as General Manager later this year, cites the example of the Belmond El Encanto in Santa Barbara, California.Everyone in Los Angeles thought that's for my grandparents," he recalls. But through highlighting a glitzy wedding on social media, they were able to change perceptions. So it's just changing the tone of your marketing, branding to say 'you know, you should come and try (the hotel).Le Meurice in Paris is also trying to change perceptions.It hired a young pastry chef, Cedric Grolet, who has become something of a celebrity with some 880,000 followers on Instagram.We're hiring millennials to help bring us innovation and 'seduce' the new generation, said Delahaye of the Dorchester Collection. So we're surrounding ourselves with, and welcoming, millennials in order to evolve.The Four Seasons group, which set up a design studio a few years ago to explore how its guestrooms should evolve, has engaged a consultancy to map out its strategy to attract millennials.It has formed a partnership with CGK, the Center for Generational Kinetics in the US, to find out what millennials are looking for and how the hotel chain can best cater for them.CGK had already been involved in auditing their social media channels and online presence "and they understood the Four Seasons culture which was critical for us," said Sayess.Each of its hotels will have internal and external review teams, "because then millennials of New York may be looking for something different from a millennial in the Maldives. The objective is to eventually come up with a playbook for every single hotel and resort," Sayess said.And there's the rub. There may be some two billion millennials around the globe, but as a group they are very diverse.Millennials in the emerging markets will have different behavioral and spending patterns to those in more affluent cities such as New York and London."We need to totally re-think how we approach this generation, how we facilitate their journey with us," Edition's Ammerstorfer said. Patience is no longer a virtue as speed and convenience have become all important. "I suppose we need to find a way of working around this. Some companies have done this very well already, while some others need to learn."

Wine in a keg? There's more to it than meets the eye

EHL · 9 May 2018
LAUSANNE, Switzerland -- In a collaboration between CG Industry, the IFV (The French Wine and Vine Institute), the School of Oenology and Viticulture of Changins, Bibarium, the Cantons of Vaud, Geneva and Neuchatel, and the Ecole hoteliere de Lausanne (EHL), the Ecofass-Vin wine in a keg solution is being studied and tested for the European market.Ecofass-Vin is wine on tap, thanks to a keg. The keg preserves the taste and quality of the wine while also providing a more ecological approach. One barrel of 20 liters replaces 30 glass bottles of wine, requires less space to store, and saves on recycling of corks, labels and wine boxes - which translates to a lower carbon footprint overall.Several famous winemakers (for example, Stephane Gros) and producer cooperatives (such as the Cave de Geneve) already trust the wine in a keg solution. Clients confirm they are saving money, with fewer partially consumed bottles and less corked wine. Using the kegs also saves on storage space and requires less handling by servers.For consumers, the wine in a keg solution offers the ability to sample wines and learn about different varieties without having to order an entire bottle of wine. They also value the less expensive alternative to bottles, the opportunity for better food and wine pairings, and the eco-friendly approach.In France, EHL research has noted that many consumers have already expressed a preference for wine by the glass. EHL will conduct further research among consumers who might resist the absence of service and presentation rituals of bottled wine to better understand any barriers.The market potential for the kegged wine product is substantial. In the US, the system has been adopted by more than 4,700 establishments, and conditions in Russia and Italy are favorable for wine in a keg and draught consumption. Closer to home, in the Romandie region, 14 establishments have adopted wine in a keg, and about half of the restaurants and beverage providers of the Romandie favor the solution, according to research from EHL.

Exploring Niche Markets in Hospitality: Seizing Untapped Opportunities

EHL · 9 May 2018
Yet, some interesting players have taken a different approach by going after niche markets.For example, , the General Manager of Intercontinental Davos, believes that "going after niche markets is not only a trend, it is the future itself." Fuglister encourages hoteliers to be on the lookout constantly for fast-changing patterns and to differentiate trends from fads. "Determining a niche market strategy will be fundamental for the success for any profit-oriented company", he said.In November 2017, Airbnb bought travel business start-up Accomable, which targets disabled travellers. As a result, Airbnb now offers 21 filters for guests seeking accessible travel accommodation. That's another example of reaching out to a niche market.'It's the future itself'Daniel Fuglister, the General Manager of Intercontinental Davos, believes that "going after niche markets is not only a trend, it is the future itself." Fuglister encourages hoteliers to be on the lookout constantly for fast-changing patterns and to differentiate trends from fads. "Determining a niche market strategy will be fundamental for the success for any profit-oriented company", he said.Fuglister was taking part in a panel session on untapped opportunities in niche markets at the Young Hoteliers Summit staged in mid-March at Ecole hoteliere de Lausanne.Mathew Nixon, who handles business and operations transformation at Dorchester Collection, told the panel session about the hotel group's approach to 'lean' niche markets.We categorize niche markets in the sense they could be royalty, they could be fashion, art, entertainment. They could be anyone of those items and we've actually been operating our business based on that for a long time.For instance, 45 Park Lane, a boutique London hotel, had "put a stake in (the ground) and said we're going to be the hotel that's going to be all around art. And when you walk into that hotel it's almost like an art gallery. So it's very boutique, very specialized and really targeting (niche markets) in saying we have sophisticated tastes, if you're a traveler who wants to come here, we will show what sophistication looks like." The hotel changes the art work on a quarterly basis "to keep it fresh and engaging," and is currently showcasing young, emerging talent from London."We think that's a perfect example of a niche market that we've gone after. Our challenge is to defend that because if we talk about competition today and about the speed of change, we've got to be leading. Guests come to us because they want to validate their status or place in the world and so they come through our doors expecting to be taken somewhere. And we've got to be very focused and very committed on where we do that."He gave the example of the Dorchester Collection's Plaza Athenee in Paris which is 'all about haute couture'. "You get that feeling when you walk through the door - the way you're greeted by a lovely lady in a fabulous red dress on avenue Montaigne which is the best shopping in Paris. They've put a stake in the ground that says we're about this, this is a niche business - fashion - but we're going to be for a certain crowd which appreciates fashion."Can a niche market ever enjoy the business volume of a mass market?Disneyland Resort Hotels, together with Disneyland Parks, aim to provide magical experiences for Disney fans, their target market. Yves Wencker, Director of Lodging at Disneyland Paris, stated that in the past 23 years, his theme park has attracted some 320 million visitors - hardly a 'niche' as such - especially as the park has seven hotels with 6,000 bedrooms.You're choosing the destination first. It's all about the storytelling. You want to have either a very premium location so you would decide to stay in a five star property or you want to enjoy the richness of a different franchise ... This is the DNA of Disney. We are into storytelling, we're into the magic.Disneyland Paris then serves as an example of how you can target a specific market but actually achieve mass market volumes. Certainly, this success is due in large part to the huge numbers of Disney fans around the world, with only seven Disneyland Parks around the world serving this fan base.Furthermore, not only is Disney celebrating Mickey Mouse's 90th birthday this year ("everybody has been touched by that magic"), but Disney is also growing several other movie-related franchises such as Pixar, Star Wars, and Marvel."All these franchises allow us to pursue new niches, new market segmentations where you will be able to experience what you're looking for, regardless of your age, throughout the year. And I think that's where the future lies. What will be your storytelling? Regardless of the hotel brand, it's about defining the segment, the storytelling, and the experience."Can an independent hotel create its own niche market?Adam Rowledge, the General Manager of Georgian House Hotel in central London outlined his hotel's experience in attracting and serving a niche market.Georgian House Hotel offers seven wizard chambers, with the majority of its guests travelling from nearby Victoria Coach Station to go on the Warner Bros. studio tour - the Making of Harry Potter. Video credits Business Insider UK Georgian House Hotel serves 'wizard breakfasts' for guests staying in the wizard chambers, and offers wizard cocktail-making experiences. Nor is Georgian House Hotel limiting itself to wizard fans, as it is also attempting to reach other niche markets through F&B experiences such as a 'pop-up' cheese afternoon tea, upcycled meal experiences, etc.Christopher Cox, the Regional Director for Central & Eastern Europe at Preferred Hotels & Resorts, highlighted the hotel owner's perspective in terms of niche markets. Guests can search for different travel 'experiences', he said, whether it skiing, beach holidays, family vacations, or heritage hotels, and each of these experiences can represent a niche market.Preferred Hotels & Resorts has four 'collections': Legend, Lux, Lifestyle, and Connect. Individual properties within those collections, Cox said, reflect the right experience and help hoteliers reach the right niche markets.We are a soft brand and we would never position ourselves as a niche company. However if you look at our hotels, obviously we have a lot of niche properties and destinations. And owners (choose) Preferred because they ... want to keep independent and keep control of their hotels.Fans. An untapped opportunity?Legions of Disney fans are the main target market of its seven theme parks. Georgian House Hotel attracts wizard fans. Dorchester Collection connects with lovers of art, fashion, and entertainment. Similarly, nhow Hotels targets professional and amateur musicians. Established hotel brands such as Intercontinental and Preferred Hotels & Resorts offer an array of properties aimed at different niche markets.By targeting a niche market, hotels can adapt their services and products to better serve customers and maybe face less competition, while achieving greater profitability.How can a hotel start tapping niche markets? A recent example is Airbnb staging a competition to win a night's stay at Lego House. By working with the toy company, Airbnb has been able to reach Lego's fan base. Hoteliers can start by hosting hobby fans, whether it be fans of Lego, sports, food, movies, or music. Over time, the hotel will identify specific groups of fans most aligned to its DNA and, in time, turn them into its own fans.

Restaurant Revenue Management Practices: Altering Customer Perceptions

EHL · 8 May 2018
Based on our research, we found that the majority of revenue management practices in the restaurant business are perceived as unfair (see Table 1). Customers though seem to accept price variations between lunch and dinner, as well as cancellations due to late arrivals.The practice which is perceived to be most unfair is the policy based on time spent at the table. Customers seem to completely reject this practice and most of the other practices.Table 1Our findings also showed that the perceived fairness of practices related to lunch/dinner, weekend/weekday and time of day price variations does influence whether customers intend to return to the restaurant in the future.The booking policy of a restaurant also has an impact on customer patronage intention. However, table management and control duration policies do not impact customer patronage intention, even if these practices are perceived unfair.Figure 1As it has taken some time for revenue management practices to become acceptable in the hotel industry, it might take more time for such policies to become acceptable to customers in the restaurant industry. At present it seems they are not yet ready for these practices.Restaurant managers, who want to apply revenue management practices, should be aware of the above findings and seek to 'educate' their clients about the advantages of such practices for themselves. This must be the priority for the company before applying these practices.Restaurateurs should communicate to clients the benefits of these practices via their employees. Indeed, when we talk about service companies, employees who are dealing with customers face-to-face are effectively our best channel of communication. So what are the specific benefits for customers? For example, price variations based on the date of booking can be very useful for clients.Nevertheless, it is the responsibility of the restaurant to make sure that this kind of practice is well understood by clients to create positive word-of-mouth.Another important issue is the profile of restaurant customers.Indeed, we discovered that young people accept better practices related to booking policy and table management than older people. The reason for that stems from the fact that they are more aware of such practices and try to keep a rein on their spending. So, they can see financial benefits for themselves from these practices.Restaurants wanting to adopt revenue management practices should also take into account the profiles of their clients.The bottom line is: applying these practices can only work if they create value for your customers, even before creating value for your restaurant.Access the full study:Are customers ready to accept revenue management practices in the restaurant industry. International Journal of Quality & Reliability Management. Reza Etemad-Sajadi (2018)
Article by Stuart Pallister

How Critical are Millennials for Hotel Brands? [VIDEO]

EHL · 8 May 2018
The topic of millennials and hospitality was featured in a panel session during the 9th Young Hoteliers Summit at Ecole hoteliere de Lausanne.How critical are the millennials for hotel brands? Andreas Scriven - Head of Hospitality & Leisure, Deloitte.When it comes to millennials, it's about the way of doing things which may be linked to service but they're just faster. Things happen faster. Brands keep on coming again and again, so saying that millennials are different is completely wrong.However, they're born with a smartphone in their hands, so they don't have time for bullsh*t.What hotels need to realise is about speed and convenience, more so than putting yellow floors in the lobby and having house music. You see so many of those new concepts that look good in 3D rendering but the fundamental behind it, the skeleton, is still the old hospitality. So I think as long as hotels view the service flow and process the same way and they just change the make-up, they won't get millennials.Youri Sawerschel - Founder and brand strategist, Creative Supply.We are currently transitioning, introducing online check-in and check-out. This frees up capacity for other services. We've just introduced a Whatsapp service so you can contact the concierge or guest relations manager and say, hey I need another towel or I'm in the city.By doing these, you can add more services that are appreciated, more personal services that will again create more positive memories.Jessica Emde - Brand manager, nhow Hotels.It's connecting with local experiences. It's about connectivity, creating connectivity (through messages shared on a screen in the lobby, etc.)And I don't think it's a young thing because even I enjoyed it and I'm not a millennial. But I'm a millennial at heart.Navneet Bali - Chairman, Meininger Hotels.If you look at lifestyle hotels like Ace or Hoxton in London, you walk into the lobby and there are people that look like a community but they're all on their computers, on their headphones and they're not talking to each other on a human level at all. So is that actually connecting?Andreas Scriven - Head of Hospitality & Leisure, Deloitte.At Meininger you'll find everybody is texting or Facebooking or whatever. But at the same time they want to connect. They want to really meet people as well. So it's a question of balancing both.Navneet Bali - Chairman, Meininger Hotels.We shouldn't focus on one generation. Millennials are important but so too are the baby boomers. Of course, it's important that you focus more on who you want to give your products to and then build on them.The millennials want things now and not only in terms of services. There will be other generations, so we shouldn't focus on one. It's never good to have one shot. Never.Alessandro Redaelli - VP, operations, Paramount Hotels and Resorts.
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2018 Hospitality Industry Outlook - Let the Good Times Roll... for Now

EHL · 1 May 2018
The International Hotel Investment Forum held in March (IHIF2018) presents an opportunity to sit back and take stock of where the industry is heading. As Hospitality Insights reported a year ago, the economic outlook at the time was cautious, but the pace of structural change in the industry was accelerating. This year, there was plenty of optimism despite some 'clouds on the horizon' in terms of the economy.There is an absolute wall of money looking at the hotel sector at the moment,said Keith Lindsay, Managing Director EMEA with CBRE Hotels, at the start of a panel discussion on investor's intentions in 2018 and beyond."2017 was a bit of a frenzy and with all the capital formation that's happening at the moment, it's quite likely there'll be a repeat of that (in 2018)." CBRE's Hotels Investor Sentiment survey sees 37 percent of investors looking for capital growth this year, compared to 24 percent a year ago.According to Alexi Khajavi, Managing Director EMEA and Chair of Hospitality and Travel at Questex, which stages the IHIF, there's plenty of positivity right now in the marketplace. "We've been in the longest cycle in the history of the industry," he told Hospitality Insights. So since roughly 2009 it's been quite a good cycle. I think everyone was looking over their shoulder, wondering when the party would end but the fundamentals are good."Russell Kett, Chairman of HVS London, said in an interview with Hospitality Insights on the sidelines of the Young Hoteliers Summit at EHL a week later that there is a 'greater understanding' of the asset class now and hotel investors are seeking 'good deals' in the sector."What they're looking for in the hotel industry is the opportunity to make good money and use that investment to get a stronger foothold in the sector. No longer is it the poor relation of real estate but an asset class in its own right.""I think there are a few more years left in (the industry cycle) and I look for signs and can't see any. Yes, there will always be shocks ... but for the most part, the industry is on a firm footing. I don't feel any declines coming our way."Kett moderated a panel discussion at the Young Hoteliers Summit on 'The Changing Dynamics of Hotel Ownership.' At the start of the session, he stated that in Berlin last year, everyone was thinking the industry wasn't doing 'too well' but the year finished strongly after 'a bit of a sluggish start', helped by the return of North American investors.During the YHS panel session, Marc Socker, Managing Director of investment management firm Invesco, said he'd never seen so much interest in the sector. "Importantly, hotels have a yield premium."So why are institutional investors interested now?"First and foremost, hotels is a growth sector," Socker said. "You can look at supply-demand fundamentals in Europe; demand is growing quicker than supply in most markets. Some of the biggest challenges European economies have are how do we cope with the influx of tourists coming into the market?"Socker pointed out only four percent of Chinese nationals currently have passports and five percent of Indians. "Every increase of one percent (in those populations with passports) leads to tens of millions of new travelers coming into the European market."Kett also regards this as a major opportunity. He told Hospitality Insights: "You only have to move the needle a little bit and anybody who's worried about demand growth need have no worries at all. And that's only two countries in the world. One of the staggering facts is that 90 percent of Americans also don't have passports. They have a lot on their own doorstep they can enjoy, but it's still a fraction of the total population that has traveled outside their shores.""There is a myth out there that hotels are this volatile asset class with very fluctuating income," Socker said, adding that, according to benchmark data, hotels outperform the all property index. In addition, the sector shows 'very little volatility' and was the only commercial asset class that "didn't go negative in terms of total return during the crisis.""So there are lots of reasons why hotels are interesting out there. They just have to be understood. It's a specialist class after all."Private equity, asset management and financial services firm Blackstone is also investing in the hotel sector, particularly resorts.Abhishek Agarwal, Managing Director of Real Estate, told the Berlin forum that Blackstone's investments were "underpinned by our belief in the fundamentals in the sector, especially if you look at the demand-supply side. There seems to be an imbalance."Spain is a major focus. Last year it saw a nine percent increase year on year in international visitors to 82 million, making it the second most visited country after France. "That's huge and good for the leisure business," Agarwal said.Given this backdrop of positivity, what's then the view of hoteliers?Michael Levie, Chief Operations Officer of citizenM Hotels, told the YHS in a keynote speech that the industry is at an all-time high.People are really looking to us. There's a lot of money available. For the first time, we're getting a seat at the table. So we're awfully excited. There's always been money, it was just never interested in our industry."What can we do with it? It will, for a short period, shows us quite a (number) of transactions. In the long run it will filter out a lot, because the minute the industry starts to shift a little in an economic downturn - and let's say the best of breed survives and others have a more difficult time - you will see a big shake-down again. So I think it will be a short-lived cycle."The boom days may be here - for now. However, further consolidation may be on the cards."It's not about optimism, it's about realism," Levie said. "As an industry, we don't offer great differentiated products. As an industry, we're not consistent in our products. As an industry, we don't produce brands." You can see 'incredible returns,' in other investment classes, he said.We've just never done that as an industry. So we're a cork afloat on the ocean and just because we're on top of the wave ... we shouldn't get too excited because it's a (long) way down again.

HITEC Amsterdam 2018: Why I Will Definitely Be Back

EHL ·27 April 2018
While I prepared for the conference, I read up on the latest technological innovations, and on startups trying to overthrow OTAs. I read about revenue management and machine learning. Stepping off the plane in Amsterdam, I was confident I had done my homework and was ready to keep up with all the technical conversations I was going to have.Things didn't exactly go as I had planned.After attending the E20X pitch competition, going to dinner with a dozen CIOs and CFOs, and covering a panel discussion on AI and voice recognition, I realized I was not at a geeky tech conference. I was at an international gathering of highly skilled professionals, versed in a myriad of disciplines that directly or indirectly add value to the hospitality industry. This was a place where the common denominators were passion for service, love for human interactions and a genuine openness to the world.It wasn't about tech. It never has been. It was about people.Hospitality is the ultimate people business. This statement is not only valid because hotels have to satisfy their guests. Many of the exhibitors of HITEC Amsterdam expressed concern for the well-being of hotel staff, the environment and the economic welfare of the populations at the destinations. No one was competing. Burgeoning entrepreneurs, young graduates and seasoned businessmen all coalesced with a single wish: to raise the bar of how technology can better serve the hospitality industry.Although I feel women are somewhat underrepresented in the industry, I am hopeful as I see this trend decreasing when we look at the new generation of hospitality managers. For instance, Ecole hoteliere de Lausanne's student base has a slight female majority, and we will definitely see more and more of them taking leading roles in the many exciting changes to come. This was perfectly illustrated by KITRO -- the food waste company that uses AI, created by two female EHL graduates, and ultimately won the Judge's Choice Award at the E20X pitch competition.I will be looking back at the three days I've spent quite fondly. I have met so many interesting people, each with their own past, interests and aspirations and each one has helped me gain insight into the future of hospitality.As long as this spirit lives on, I will be coming back to HITEC in Europe.Sherif Mamdouh is the external communications manager at Ecole hoteliere de Lausanne (EHL) and an official guest blogger for HITEC Amsterdam 2018, which took place 11-13 April 2018 at the RAI Amsterdam Convention Centre in Amsterdam, The Netherlands.

Ecole hoteliere de Lausanne (EHL) Wins Best Employer Ranking

EHL ·26 April 2018
LAUSANNE, Switzerland -- Ecole hoteliere de Lausanne (EHL) wins the title of Best Employer in French-speaking Switzerland in the category of medium-sized companies in the annual ranking of the magazine Bilan published this week.Offering a dynamic and pleasant work environment on the campus north of Lausanne, the 464 employees of 33 nationalities benefit, among other things, from home-office opportunities, seven weeks of vacation, access to sport facilities and up to three free meals a day.Reacting to the announcement, CEO of the EHL Group, Mr Rochat said "the quality of the work environment is one of the priorities set for the EHL management. It is important for us to be able to attract and retain the best talent to continue to provide the best training to our students, and maintain our leadership position in teaching Hospitality Management. We work on a number of fronts, whether in process transparency, gender equity, or the recognition of successes achieved within the institution, for example, sabbatical leave or the research award handed out each year within the faculty."Chief HR Officer, Pascal Gauthier adds: "As a university of applied sciences, the training and individual development of our employees is obviously important to us. We invest in continuing education at all levels of the organization. This is a very attractive benefit for our employees in an increasingly competitive job market.""We also strive to increase opportunities for our staff to communicate with management, through employee committees, expanded communication channels, satisfaction surveys and dedicated project groups. This principle of openness makes it possible to raise messages and new proposals in order to apply continuous improvement internally." Mr Rochat continues: "It's a great joy for us to receive this distinction on the occasion of our 125th anniversary, it shows us that we are on the right track."Ecole hoteliere de Lausanne (EHL) is an ambassador for traditional Swiss hospitality and has been a pioneer in hospitality education since 1893. It has created and inspired a unique professional community of over 25,000 hospitality managers, united by the values and the legacy of EHL.EHL is a leading university that provides learning solutions for enthusiastic, talented and ambitious students from 119 different countries. With undergraduate, graduate and certificate programs, EHL offers its students a range of on-campus and online education opportunities at different stages of their professional journey.EHL is regularly recognized as the best hotel management school in the world with the highest graduate employment rates in the industry. EHL is a member of EHL Holding SA, a Group dedicated to hospitality management education.

AI and Voice Recognition Explored at HITEC Amsterdam

EHL ·24 April 2018
I have had the pleasure of a front row seat at a very special panel discussion. The hospitality industry's top tech executives got together at HITEC Amsterdam today to discuss artificial intelligence (AI) and voice recognition. The challenge: to make sense of all of the changes happening in information technology and articulate value-adding solutions for the hospitality industry. How do we turn a land of confusion into a land of opportunity? The panelists had a few secrets to share.The panelists:Jorge Carmona, co-founder, VeovoxGwendolyn Graman, global proposition lead conversational commerce, CapgeminiKees Jacobs, digital proposition lead, CapgeminiHampus Ljunggren, head of strategy, Travel AppealFrank Reeves, co-founder and CEO, AvvioThe Moderator:Ian Millar, senior lecturer, Ecole hoteliere de Lausanne (EHL)Each panelist, through his own experience and colorful storytelling, perfectly exemplified the tremendous potential for an enhanced overall customer journey through technological innovation.Exploring future usages of these promising, yet still untapped, technologies is something that entices a growing number of companies. The required investment (time, training, expenditure) remains however, a major roadblock in the quick adoption of the many tools, products and services being developed.Communication is changing, expectations are changing too, and immediacy has become expected of anyone under the age of 35. If you have a question, you want an answer NOW. If you need room service to bring a toothbrush up to your room, an unanswered call by reception will kill your customer satisfaction.From a conversational point of view, chat bots offer the possibility to cater to this (slightly capricious) expectation that everything must be delivered at the very moment we have an enquiry. Voice recognition is said to greatly enhance the in-room experience. But let's put all the technical stuff to the side for a moment...One of the most interesting ideas, on which all the panelists seemed to agree, was that you can have all the tech in the world, but if you don't reach your customer at an emotional level, you won't make a difference. This statement takes on a whole new dimension when it is made by people who make a living from interacting with emotionless machines."Rational drivers are still too predominant. Emotional drivers need to be further explored and leveraged," said panelist Kees Jacobs of Capgemini. Only then will innovations such as voice recognition make an impact. And when it happens, it will definitely be disruptive.Who cares if we can control our room with our voice, you ask? Well... humans are lazy (yes, you too). Convenience and ease of use have been the root of much of the world's innovation -- ever since that one guy got tired of pulling on raw meat with his teeth, and decided to smash a rock and use its cutting edge (see what I did there?) to cut through those annoying nerves.It's not only about using voice commands for single actions, such as "switch on TV." Yes, you could probably spend fewer calories just pressing the little red button on the remote. Where it gets interesting is when several actions can be initiated by a single voice command. Imagine the command: "computer, I will go and cook now." The oven turns on, the kitchen lights turn on and your favorite cooking music starts playing on the speaker located in the kitchen.Frank Reeves, whose company Avvio uses AI to offer a unique booking journey, agreed and explained that when it comes to booking engines, they all "serve up same experience to everyone." AI effectively allows a company to individually and proactively engage the user, personalize the experience and incorporate said emotional triggers. This is done, he says, by building up users' digital footprints.Overdependence on OTAs can be upset by using AI to directly reach customers with that missing emotional element. It often equates to basically having an online brochure that offers the same experience to a 21-year-old American spring-breaker and a 76-year-old Turkish grandmother. Why cross-sell car rental services to someone who doesn't have a driver's license, for instance? Good use of technology allows you to make the journey more relevant, more engaging. Show your customers you know them and you've thought of how to make their experience unique.Jorge Carmona's voice recognition company Veovox also recognizes the emotional implications of a seamless voice command experience. Preliminary feedback has shown a tenfold decrease in customer complaints. This is not only good for the sake of increasing customer satisfaction. Getting back to the psychology of it all, we can see that bad voice recognition increases frustration. Frustration raises anxiety, and anxiety is a big deterrent when it comes to spending. So bye-bye to cross-selling and up-selling. Gwendolyn Graman of Capgemini echoed this strong customer-centricity as well. "Focus on the customer. IoT and conversational interfaces must be used to better understand the customer's wishes and offer concrete assistance," she said.It turns out AI and machine learning isn't only good to "stalk" your customers. It's also good for "self-stalking." Hampus Ljunggren, head of strategy for Travel Appeal explained how he uses big data to help hotels adapt to risks and opportunities almost in real-time by "scrapping all available public data relevant to the hotel and its surroundings, identifying patterns and making them actionable through daily recommendations to the hotels." This can help with things such as pricing, cultural specificities of certain guests, or any other touchpoint where a potential improvement has been identified."Voice is also an interesting way to identify someone. Recognizing the speaker offers the possibility of tailoring the answers given by the voice recognition device.None of the panelists seemed too worried about data privacy issues and agreed that people have become used to sharing their personal information, especially younger generations. In fact, millennials expect to have their personal data used to improve their experience. The underlying tacit agreement is therefore, "I give you my personal info, and you make my life easier."AI could create a far better, overall human experience. As a hotelier, if you know what flight your guest is arriving on, send him a WhatsApp message asking if he would like an early check-in (we all hate those 15:00 check-ins!) or if he would rather book a massage while he waits for his room to become available.Exceeding the customer's expectation is when you really start tapping into the emotional side of things. And it's a win-win: you gain legitimacy for cross-selling or up-selling, and the customer is proactively provided with solutions to problems he didn't even know had a solution.Sherif Mamdouh is the external communications manager at Ecole hoteliere de Lausanne (EHL) and an official guest blogger for HITEC Amsterdam 2018, which took place 11-13 April 2018 at the RAI Amsterdam Convention Centre in Amsterdam, The Netherlands.

The Art of Pitching: Is it Overrated - or Essential?

EHL ·18 April 2018
Pitching... that thing we force notoriously introverted geeks to do for funding. The main idea is that an entrepreneur -- unless his name is Elon Musk or Tony Stark -- has limited resources and needs the financial support of pockets that are substantially deeper than his own.If you, as an aspiring business leader, want potential partners and investors to buy into your idea, you need to sell it in a concise, explicit and exciting way to a floor of overconfident, seen-it-all financiers who might not know much about the technical complexities of that next big idea you're certain to have found.The idea that a unilateral monologue, performed onstage by an individual who has little to no public speaking experience, would make or break a startup sounds sub-optimal at best. Being a poor public speaker or salesman doesn't necessarily mean you will be unsuccessful as a businessman, leader or creator. Is it not possible, after all, to have an absolutely incredible idea that is just too complicated to be presented in two, four or even eight minutes?Today, pitching is an integral part of the entrepreneurial ecosystem and an inevitable hurdle on the road to financial sustainability. However some people call it out for being an overrated exercise.Derek Lidow, author of "Startup Leadership" said, "The problem is that pitching is a waste of time, and teaching this as a primary skill of entrepreneurship is misleading and sets the wrong priorities for aspiring business leaders."He goes on to say that "there is no evidence that people who give the best pitches have materially better chances of business success than any other entrepreneur with the same motivations, traits and skills presenting the same idea."This pitch mania can give way to a critical analysis where form trumps substance, and becomes a distraction from the core competencies of the entrepreneur who has all but lost sight of his own priorities. Basically, pitching can be a dream killer.So why do we still pitch?Surely, there must be a better way for VCs to spot startups with potential, right?Well... not really. Pitching is a MUST, and no other process allows you to gather your thoughts, distill them into a crystal clear proposition, and give an opportunity for potential investors to size you up. So, dear entrepreneurs: Rejoice! Your efforts, your endless rehearsals and those nightmares you've been having where you realize mid-presentation that you forgot to put on pants will not have been in vain.First of all, the only way for the world to become aware of that awesome idea you have will be for you to go out there and put on your storytelling hat. And it turns out, there are people who make a living out of listening to these stories and who even give you a whole lot of money if they like what they hear. However, angel investors, VCs or PE firms are on tight schedules and have an ever-increasing amount of people to listen to -- so yes, you need to make your mark when you do get a few minutes of show-and-tell.Dr. Margarita Cruz, a strategy professor who teaches an entrepreneurship class at Ecole hoteliere de Lausanne (EHL) said it best when she explained in a recent interview that "even if entrepreneurs have really good ideas and business orientation, they need to stand out to be able to attract resources."Carson Booth, a technology startup consultant and former Starwood senior vice president of global property technology, explains the exercise of pitching as necessary because it "hones a founder's or their marketer's ability to succinctly define their product, market and approach." "It's a bit like knowing within a few seconds whether you'll like a song or not," he added."The goal should be to distill the idea down to what interests the audience and elicit a desire for more information." - Carson Booth.Booth, who says pitching is indeed an essential part of the business creation process, also makes a point about the choice of the speaker being an important indicator of the founder's leadership skills. After all, the job of a CEO is to know who within his team is most suitable for each task."Sometimes there is no one else than the founder to go on stage, and that's OK, but they need to work extra hard. However, they should remember the audience is on their side and rooting for them," he said.Openness to constructive criticism and a generally positive demeanor will go a long way to gain their favors.EHL's Dr. Cruz also points out the fact that preparing for the pitch isn't only relevant for external audiences. "Learning to pitch their business idea helps entrepreneurs highlight their value proposition and prioritize the most relevant parts of their idea." This process will efficiently work to ensure the plausibility of the project."Being able to pitch without having a sound idea, or without testing that idea in advance, does not really work. From that point of view, I think pitching complements the entrepreneurial process," she added.It also turns out, apart from the obvious reasons to attend pitch competitions, like meeting investors or networking, pitching serves many other purposes such as probing your future consumers, getting a healthy dose of motivation from the buzzing corridors of the convention center, or witnessing other great performances that can truly inspire you.Finally, if we spend our time complaining about pitching being "form over substance," we need to be reminded that this is, in many ways, how consumers react to products. This is basically the concept of brand value, and it will be a major determinant of your success in business -- so we might as well get attuned to it as early as possible, and even enjoy it while we're at it!Initially posted on HFTP Connect on April 10, 2018.HITEC Amsterdam 2018 featured its successful pitch competition E20X, where 11 innovative hospitality technology startups presented their breakthrough business concepts to an expert judges panel and a roomful of industry professional spectators. EHL Alumna Anastasia Hofmann and Naomi MacKenzie from Kitro Waste Management won the 2018 Judge's Choice Award.

What do Young Hoteliers Look for in Their Career?

EHL ·28 March 2018
In the new era of asset light strategies, the acquisition and retention of young talent is becoming a strategic function for global hospitality companies. Winning companies should embrace new talent strategies to outperform their competitors in their respective markets, and better prepare for upcoming challenges from disruptive hospitality companies.For the 9th year in a row, the Young Hoteliers Summit Employer Rankings Report explores career path motivations and workplace characteristics young professionals view as the most important. This year, 1766 completed the survey from 95 nationalities across 198 schools.Key takeaways:Career Path AnalysisMore than ever, intrinsic motivation is key for motivating young graduates to work in a specific company. Development and learning opportunities, company culture and work life balanceare key factors graduate consider when choosing a job. Hotel companies should seriously consider these factors to attract and retain talent.There is also a general increase in interest for traditional hospitality in the past 3 years. This is very promising for a relatively slow changing industry. Hotel companies should benefit as much as possible from this new motivation and continue widely promoting the industry to continue this positive momentum.Hotel companies should also consider other industries with similar traits as hospitality (banking, events, and luxury and fashion) as competitors to attract talent. Highlighting the core values of hospitality (relationships, teamwork, service) would set hotel companies apart from the other industries.Communication & HR PracticesIn order to reach and attract new talent, hospitality companies should provide opportunities to have direct contact with the company environment by offering personal experiences within the company. Additionally, young graduates place greater value and trust on information or experiences provided by peers. Nowadays, brand and work environment reputations are co-constructed with your potential employees.To further enhance young graduates' interest to work for a particular company, hospitality brands could offer potential employees greater insights into their products and company culture.It is imperative to provide opportunities for young graduates to experience company's competitive advantages in terms of working environments.Hospitality companies should also aim to highlight their internal culture and job offering on company websites and presentations.RetentionAs mentioned by KPMG (2017), young millennials need to perceive the overall purpose of their work in order to truly commit themselves. Hospitality companies should focus on delivering their employee value proposition in order to reach high retention rates of new graduates. Clear career development and learning opportunities should be presented to the new graduates even during the recruitment process.When considering turnover of employees that have been working for over a year at the company, fair monetary compensation as well as an adequate work life balance, should also be taken into consideration.Brand AwarenessThe top 10 preferred brands in the Luxury & Upper Upscale segment were fairly similar to the past two years. On the other hand, the results of the top 10 brands present in the Upscale & Upper Midscale segment are more varied. This is a possible signal to greater uncertainty or lack of knowledge of these particular brands. Therefore, greater brand exposure is necessary for Upscale & Upper Midscale brands. Lower scale brands should seize this opportunity to become more visible in the job market and recruit a larger share of young graduateDownload the full report nowAbout Young Hoteliers Summit and the RankingsA student-led initiative, the Young Hoteliers Summit (YHS) gathers each year representatives from approx 40 international hotel schools at the EHL campus for 3 days of conferences and networking.The YHS Rankings are an integral component towards achieving the mission of YHS, which is to improve opportunities for young talent by putting global hotel companies in the spotlight. Since 2010, hospitality students worldwide have been asked to give their perception of hotel companies in terms of employers and recruiter

RESEARCH SUMMARY - The Swiss Tourist Satisfaction and Happiness Index

EHL ·27 March 2018
Switzerland has traditionally been one of the world's best tourist destinations largely because of its service excellence in tourism. Yet the success of the tourism industry also depends on continuously delivering high-quality travel experience to tourists.The Swiss Tourist Satisfaction and Happiness Index has been developed to provide accurate measurement of tourist satisfaction for the Swiss tourism industry.So what factors should be taken into consideration when assessing tourist satisfaction? Download the summary of the study here:

Brand Building: a More Cost-Effective Way to Raise Your Company's Profile?

EHL ·26 March 2018
When Arnaud Bertrand and Junjun Chen finished their studies at Ecole hoteliere de Lausanne in 2008 they went on to set up HouseTrip, an alternative accommodation start-up which would compete head-to-head with Airbnb and other online travel agencies.Initially the couple had just a laptop, an internet connection and an idea. They went literally from zero to annual revenues of 100 million dollars within just five years or so. Junjun takes up the story. "We were still in school, doing our second internships. We were in London and wanted to go to Scotland but we were students so didn't want to spend too much money. So we wanted to rent an apartment in a nice, traditional Scottish house. We did find one through craigslist but the logistics part was very painful because we needed to contact the owner by phone and arrange payment by bank transfer. So it was just really painful."They had - by chance - stumbled upon a gap in the market and wondered why it was that although online travel agencies like Expedia and Booking.com focused on hotel bookings, no one was providing similar services for holiday homes. "We said, 'look, no one has done it. Let's do it ourselves.'"That was easier said than done. The first major challenge they faced was how to raise funding, based on little more than an idea. "(We had) no track record and no work experience because we had just studied at EHL," says Arnaud. As it turned out, some of their EHL classmates were 'crazy enough' to invest in the new venture and helped to get the project off the ground.That initial funding helped but Arnaud and Junjun would need to go on to raise substantial funds from venture capital, some seventy million dollars over several years. Part of the problem they faced was in marketing the start-up. They would raise millions but would end up spending massive amounts too, pumping money into keyword marketing."Most of [the money] went on marketing and hiring," says Arnaud. "We had a fairly large team, north of 200 people by the time we sold the company (to TripAdvisor for an undisclosed figure in 2015)."And their biggest mistake? "I would say probably using Google or paid marketing as our main acquisition channel," says Junjun. "Basically it works and we became addicted to it. And then at one point we couldn't get rid of it.""The best marketing is free marketing," adds Arnaud, whether that's word of mouth or getting media coverage. That means engaging with journalists and trying to concentrate on public relations rather than spend huge amounts of money on digital marketing, which proved to be a losing prospect.But to get the right word of mouth, you need to make sure you have a great product. "No one is going to speak about a so-so experience."Eventually, after several years of scaling up the company, Arnaud and Junjun chose to exit their venture rather than aim for an initial public offering or IPO. (HouseTrip is now one of 20 travel media brands belonging to TripAdvisor). "I don't have any regrets", says Arnaud. "We sold at the right time.""You don't have so much strategy as you have dreams. Of course you dream of the best possible exit from your company but you have to be realistic and opportunistic as well."Now they've set up a new virtual reality dating company, LovInVR, and plan to learn from their mistakes by focusing on building the brand rather than spending millions on performance marketing.Arnaud says that, after selling the company, he wrote a 600-page book, more for himself than for possible publication, on the lessons learnt, "especially all the mistakes we made which were many.""We created an internet start-up that, 10 years down the line, is still alive, that's already success ... It's actually why being an entrepreneur is so fascinating because you get to learn so much from what you're doing."HotelTonight: An integrated approachAnother tech firm which is focusing on brand building to get its message across is HotelTonight, which has just celebrated its seventh anniversary.HotelTonight VP, Amir Segall, came to Ecole hoteliere de Lausanne recently to speak to students about the company which aims to offer clients the best deals for last-minute hotel bookings via its mobile app.Segall told Hospitality Insights that brand building is critical for the company. Brand awareness, he says, is its biggest opportunity - and challenge."We feel we have a really good product and have mastered the customer experience. So it's really about growing that brand awareness, letting more people know about this great product, this great service you can use, and the way we're dealing with that is that we have an array of marketing initiatives, starting from online marketing, focusing on mobile and trying to stand out and differentiate the way that we speak about our brand."In addition to PR activities, HotelTonight has formed strategic partnerships with the likes of Chelsea Football Club in London and Madison Square Garden (home to the Knicks and Rangers) in New York. For fans of these sports teams there's an obvious connection as they'll be looking for hotel accommodation when going to away matches, but there's also a brand relationship. "(This) is a very good way for us to associate ourselves with brands that have more awareness than we do and really create strong trust with customers."The partnerships are part and parcel of HotelTonight's branding and marketing mix, which also includes online and customer relationship management (CRM) activities. "We feel that you have to have a really integrated marketing approach so we want customers to see us in different places and this way we believe we're creating trust." The company has recently released HT Perks, which the company regards as a 'modern, innovative take on the traditional loyalty programs provided by legacy desktop OTAs (online travel agencies).'An IPO might be an option in the future but for now HotelTonight is focusing on its core business. "It's about becoming kind of the most prime way to book a hotel last minute and we like to think of ourselves as a mobile OTA. So we want people to be thinking about us, to be repeatedly using us as the mobile option. And so that's also what we focus on.""So right now we're very much focused on mobile, continuing to build the business, growing the business, expanding in the markets where we operate. And that's the thing that we're focused on right now."Learning from experienceHouseTrip co-founders Arnaud Bertrand and his wife Junjun Chen are also focusing on their new business, LovINVR, determined that they won't make the same mistakes this time around. "I'd say we're less naive about it," says Arnaud, adding that they believe virtual reality will be the next big thing in the digital sphere. "Dating in virtual reality completely makes sense for us. So we think the potential is absolutely enormous.""I think we're a tiny bit wiser after the HouseTrip experience, so we're trying not to repeat the mistakes that we made at HouseTrip. But I'm sure we'll make plenty of new ones." That means a more cautious, organic approach to growing the company and building brand awareness, rather any sort of dependence on pumping millions of marketing dollars into online advertising.In a presentation at EHL last year, Arnaud advised would-be entrepreneurs not to push for growth in revenue, but rather to focus on creating 'a great product that people love', even if it takes several years."My mistake at HouseTrip was to choose not to develop a brand but to go for so-called performance marketing, so to spend a lot of money on Google, buying keywords on Google and so on and I continued to do so because it worked. We were, at one stage, spending north of 40 or even 60 million dollars a year with Google."While the company was earning 70 to 80 million dollars, that still made sense. But once competitors with deep pockets began bidding for keywords, and potential customers began going directly to Airbnb and other companies than use Google search, the cost of keyword advertising became a major issue as traffic fell."It's a bit technical but that situation led us a stage where we were paying 60 million to Google still, but instead of getting 90 million, we were getting 50 million back. So we were losing money and that's a bad situation to be in.""So my recommendation would be, instead of (using) performance marketing where you don't grow your brand, try instead to go the harder way, grow your brand. It's harder, it's a lot more work, you need to spend all day calling journalists, involving your community, to develop positive word of mouth and so on ... but it's a great investment because those people will come for free and they will spread the word if your service is good.""So I would recommend you spend zero money on marketing and that's what I'm going to do with LovInVR."Dr Maggie Chen Meng-Mei, associate professor of marketing at EHL, writes:A strong brand focuses on providing a better solution than competitors can offer. Through the delivery of its unique value proposition, a brand grows its fan base and benefits from the word of mouth of passionate advocates. These statements remain true, even with all the emerging digital marketing tactics.The challenges of branding are never about using the newest digital tactics, but cleverly leveraging owned, paid, and earned channels to reach, convert, and retain customers. In the digital world, the traditional media and promotional mix (promotion, advertising, public relations, personal selling) still work.Instead of bidding for keywords, focus on finding customers who may need your solutions, as shown in the partnership between HotelTonight and Chelsea Football Club. Be present - or better still, top of mind - when customers discover they have a problem. An effective solution may convert a first-time user into a repeat customer or even an advocate.As for the new approach taken by LovInVR, which is relentlessly executing its value proposition, it will organically build its own fan base, and eventually become a powerful brand.

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