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In response to the many geopolitical, sociological, and technological changes that took place in 2017, five-star hotels are making changes—some small, some large.
Here’s what to expect, based on predictions from a panel of leading industry insiders: Tina Edmundson, global brand officer at Marriott International Inc.; Bjorn Hanson, clinical professor at NYU’s Tisch Center for Hospitality and Tourism; John Vanderslice, global head of luxury and lifestyle brands at Hilton Worldwide Holdings Inc.; and Guy Langford and Marcello Gasdia, of Deloitte LLP’s travel, hospitality, and services group.
New Fees Will Hit Major Markets
Hotels in major U.S. markets will become more expensive next year as the practice of adding resort fees, once reserved for getaways in exotic locales, becomes more and more common at urban properties—often with a nightly price tag of $25. NYU’s Hanson has noticed them most in New York, where high occupancy rates leave picky travelers with few alternatives. (They’re also rumored to be popping up in Chicago and Los Angeles.) Budget for the fee on business trips, as transparency is not yet what it should be. There is one slight silver lining: “This is better than hotels raising their room rates,” says Hanson, “since the fees aren’t subject to occupancy taxes.”
Turn-Down Service Will Disappear
Pay your respects to those chocolates on your pillow, while you still can. “More and more hotels are making turndown service optional for two reasons. One is cost,” says NYU’s Hanson. The second, he says, is privacy. “We go through cycles when people are more private and more open, and right now — for reasons I can only speculate about — people are feeling more private about their personal space. Some people don’t like their toiletries straightened up.”
“It’s a fair comment,” says Deloitte’s Langford. “My personal view is that there are things you value and things you don’t, and I don’t need anyone to turn down my bed. With certain companies, it may be part of a brand promise. But if it’s not, it’s a cost—and it doesn’t need to be provided.”
Your Room Will Get Connected
“Technology is top of mind for everyone right now,” says Marriott’s Edmundson—who oversees eight luxury brands, including Ritz-Carlton, Edition, Luxury Collection, and St. Regis—specifically investment in the so-called “Internet of Things” (IoT) tech such as Nest temperature control units or Amazon.com Inc.’s Alexa.
Marriott’s experimental “Internet of Things room,” created in conjunction with Samsung and Legrand SA, includes showers that remember a guest’s preferred temperature, digital wall art that can be swapped for family photos, and mirrors with embedded displays—for on-demand yoga videos. The rooms will soft-launch in 2018; W hotels will likely be first to offer them.
Vanderslice may get there sooner. Hilton just announced a similarly teched-out room with mobile app controls for television, lighting, thermostat, and digital art. It will debut in major cities in the coming weeks, with a rapid rollout across all Hilton brands in 2018 and 2019.
“2018 is going to be the year that the rubber hits the road with IoT technology,” says Deloitte’s Gasdia. “It took a while for this technology to mature, but now personalization can happen in real time. It’s a win-win for everybody.”
The Front Desk Will Get a Makeover
While lifestyle brands, such as Ace and 1 Hotels, have upended the old-fashioned lobby and turned it into a cool, collective workspace, luxury brands have largely stayed true to tradition. That will be challenged in 2018, says Hanson, who predicts that the check-in desk will slowly fade into oblivion, reflecting travelers’ shifting preferences for intimacy rather than formality.
“Fifty years ago, people didn’t have credit cards, and bad guys would come jump the desk and steal the cash,” he begins. “But that’s not the case anymore, and hotels no longer need that type of tall, wide barrier. Now they’re thinking: ‘Why can’t we have a little seating area that’s very comfortable and intimate?’”
Living room-like check-in areas are indeed popping up at some of the world’s finest properties. Take the Hôtel de Crillon in Paris, recently reopened after a four-year makeover by Rosewood. Its reception space is an elegant sitting room, with antique desks and a plush loveseat. The shift allows travelers to relax after a long journey—something Deloitte pinpointed as a key need, especially for business travelers, in its recent “Hotel of the Future” study.
Brands Will Appeal to Travelers’ Values
When the Eaton Workshop opens in Washington early next year, it will be the world’s first hotel for liberals. The company may be onto something. “Luxury customers are drawn to brands that communicate a sense of purpose—beyond just existing to sell something,” says Marriott’s Edmundson, pointing to “sky-high” engagement at two W hotel speaker series, “What She Said” and “Queer Me Out,” showcasing powerful women and lesbian, gay, bisexual, and transgender (LGBTQ) thought leaders, respectively.
But it’s not in every brand’s DNA to plant such politically charged flags, so in 2018, top-tier brands will find softer ways to appeal to consumers’ values—being careful not to alienate any potential guests.
“Forty percent of guests will fall on one political extreme, and 40 will fall on the other,” says NYU’s Hanson. “Few are in the middle. But there are causes that nobody could disagree with, like human trafficking, 40 percent of which occurs in hotels,” he adds. “Nobody would be offended by a company taking a stand on that.”
Wellness Will Be More Important Than Ever
“Wellness is going to be the next trillion-dollar industry,” predicts Deloitte’s Langford. “Everyone wants to capitalize on the huge swell, but every brand is making a different play. Nobody has figured it out yet.”
Already, Hyatt has bought legendary wellness brand Miraval for $375 million, while JW Marriott has partnered with the Joffrey Ballet for on-demand barre classes. Meanwhile, Four Seasons has developed wellness rooms with de-chlorinating showers and Deepak Chopra meditation videos.
“At the bleeding edge, wellness resorts are changing their talent strategies, hiring more doctors, more NPs, more nutritionists—and that’s really expensive,” says Delotte’s Gasdia. “But they’re doing really well with revenue and gross bookings.” Hanson agrees: “With even select-service brands upgrading their fitness centers, this is a place where luxury brands have the physical space to stay ahead of the curve.”
Based on a recent survey of 5,000 Marriott guests, Edmundson says that “about 80 percent of respondents agreed that improving their physical and emotional well-being is more of a focus for them today than it was three years ago—sleep improvement, new diets, and meditation all scored high in terms of what travelers had participated in over the past 12 months.” Not coincidentally, her eight brands will “lean into this space” in 2018, with JW Marriott taking the leading role.
Hotels Will Sell Far More Than Rooms
The business of running a hotel company can no longer be boxed into four walls. “These days, we think of ourselves as being more in the travel business than the hotel business,” says Marriott’s Edmundson, who is overseeing the launch of Ritz-Carlton’s cruise product in the next two years.
“In every single sector, including travel, it’s all about ecosystems,” says Deloitte’s Gasdia. “Think about Amazon buying Whole Foods. It’s all about leveraging the power of adjacent spaces.” So what does that mean for travelers? Most notably, hotels will now attempt to fill up their itineraries with experiences and activities.
“The tours-and-activities space is going through a huge coming of digital age,” explains Gasdia—and hotels want to cash in. (Airbnb caught on early.) Take Marriott’s strategic investment in PlacePass, which unlocks 100,000 walking tours, biking excursions, and culinary classes in 800 destinations around the world. Or the new “Live Unforgettable” campaign for Waldorf Astoria; Hilton’s Vanderslice says it will link hotel guests with such celebrities as Gabrielle Union at high-profile dinner events.
NYU’s Hanson argues that selling activities is crucial for luxury hotels. It helps them control the end-to-end shopping experience, offers data that can feed guest personalization, and distinguishes high-end properties from mid-tier ones.
“Luxury hotels need to do more. We get ironing boards and bathrobes everywhere, don’t need business centers, and even the concierge has become irrelevant,” he explains. Experiences, though, are a winnable space. “Local walking tours, comped theater tickets, exhibits in the hotels, manager receptions for frequent guests—these are the types of things that only luxury hotels can do.”
©2017 Bloomberg L.P.