FEW WORDS FROM THE GM OF MOVENPICK
Good day to you all and I hope that the new academic year is going well for you. So, at the year progresses, I’m guessing you thought that you could just sit down, lay back and see what else is coming your way!Well get ready for quite a number of changes that will rock the hotel and service industry over the next couple of years.
Starting with the current hotel room supply in Dubai of over 120,000 guest rooms with 50,000 more in the pipeline by 2022 – crazy right! Or not? What is the government’s strategy behind this extensive growth? A hotel supply larger than Paris or London. Perhaps the mindset is versus Las Vegas to attract world congresses to Dubai? I can hear your sharp intake of breath; see your raised eyebrows and that “rabbit caught in the headlights” surprise in your eyes.
Imagine how worried Hoteliers (and owners) feel about the ‘glut’ of new hotel rooms that will no doubt spoil their earnings of the assets, which they have often given to reputable management companies.
Or have they!
It is rather concerning that a portfolio of several hotels so quickly change management companies and their branded neon sign on the roof. This is a thing of the present and very much the foreseeable future.
Management contracts used to be long term for 15 years or more, but this seems to be changing rapidly. Only recently we have seen this happen with renowned properties here in Dubai on The Palm and Sheik Zayed Road. Management companies cannot take their contract for granted anymore and need to ensure that they outperform their competitors in all areas of the market dynamics.
Smith Travel Research (STR) is often used as a measurement tool – like it or not! Similar scenario with regard to the comments left on TripAdvisor; these forums certainly influences the booking patterns of guests and can make or break a hotel’s or individual professional’s reputation with the tap of a track pad or the click of a mouse.
What this means, is that you, as upcoming hotel professionals will be exposed! Exposed to immediate guest feedback; monitored by guest feedback applications for your professional performance; and you may even be in danger of job redundancy with the upcoming growth of the ‘blockchain’ implications. Or with the consequences of the ‘glut’ of alternative accommodations such as hotel apartments (not necessarily branded) and Airbnb with their pros and cons impact on the hospitality industry.
In these millennial times we are living in, hotels are changing – so too is hotel ownership, as with the recent acquisition of Movenpick Hotels & Resorts by the French group Accor. Reputable brands launch new and modern concepts such as Rove hotels; Indigo by IHG; Citizen M, QBIC hotels, Vipp hotels; Centro by Rotana to name but few, who cater to a much younger and not less demanding hotel crowd. Hotel concepts geared towards a specific generation such as Millennial hotels as JO & JOE by Accor. They are full of non-traditional amenities that are more practical and less costly than certain services in top 5 star rated hotels.
This may appeal to family requirements for more economical stays when a family does not necessarily want to pay for that second room for the kids as the hotel has no family rooms as part of their initial design; or business travelers not willing to pay top dollar anymore for Sheik Zayed Road top hotels. There are those guests who like a more local experience, in the case of ‘Airbnb.’
Once Airbnb have figured out how to make direct contact to the customer through ‘blockchain’, the impact will be huge; see already the Uber effect on taxis or private car hire – whilst often more expensive, their limousine services are still a serious contender in the market. In short, all database platforms, encrypted by avoiding the middleman for payment makes bookings a simple convenience for the customer. Operational structures within larger organizations will evidently change. Imagine what this means to bank transfers, credit card companies, Online Agents (OTA’s)!
All this being said, no doubt you will be excited and up for the change. For many this new era should be a very exciting – if challenging time; you have selected to enter the hotel and service industry with all these changes coming along. I wish you good luck and much success in your future careers.
Maurice De Rooij