AETHOS Consulting Group Shares 2017 Predictions, Asia-Pacific
By Georgianne Fsadni, Director at AETHOS Consulting Group
With just weeks left in the 2016 calendar year, AETHOS Consulting Group in New York, Los Angeles, London and Melbourne have gathered their thoughts and will boldly share their predictions, concerns and issues for the coming year. And while AETHOS executives focus on issues relative to their respective parts of the globe, various issues naturally transcend and impact our industry worldwide.
- Although brand proliferation will continue in 2017, the pace is likely to slow down. Instead, companies are more likely to increase their focus on brand innovation and integrity – which is critical to their success.
- The branding of independent properties will continue "en force"– with so much unaffiliated product in Australia and elsewhere in Asia-Pacific as compared to North America.
- Consolidation in the hospitality industry will continue – with only a few companies in the global hospitality industry comprising less than a quarter of the industry stock, we are far behind compared to other industries. This means that there is room for economic efficiencies across the board.
- Poshtels will make a major appearance in Asia-Pacific; this next generation of "hostels meet lifestyle" has yet to make its mark.
- Brands such as YOTEL and Ascott's Lyf, with their unique value propositions and economic-efficient designs, will make a splash in Asia-Pacific.
- Student accommodations will go through a metamorphosis throughout Asia-Pacific – innovation as it relates to design, branding and technology will be pervasive.
- Labour shortages will continue to be a major issue, particularly in countries like Australia, Japan and Singapore, where Gen Y labour is more discerning and demanding.
- As such, hotel companies will need to rethink their hiring practices at the line level through the top ranks, focusing on bringing in the "right" people, providing an environment that encourages career growth and planning actively for succession.
- Indigenous employment will continue to be a major focus in Australia, with companies such as Accor and Crown leading the way.
- Family-owned hospitality companies will seek expertise relating to asset management and hiring practices to combat ever-growing competition.
- The use of white label hotel management companies will continue, since Asia-Pacific hotel brand companies expanding overseas tend to test the water before building out their own teams.
- Asia-Pacific is "under-casinoed" and will see more development of cutting-edge casinos (Philippines, Japan, Korea and Australia), fiercely raising the stakes for the established integrated resorts in Singapore and Macau.
- The casual dining industry will accelerate in Australia as labour shortages and a high minimum wage make high-end dining less profitable. Pubs will continue to upgrade their offerings and entertainment – more ping pong tables and gardens, the use of locally grown superfoods, further embracement and variations on ethnic offerings.
- Asia-Pacific casual dining industry is a growth industry ripe for innovation. Alliances will surface, with more established companies, and proactive attention will be directed toward healthy lifestyles of a generation of consumers who get bored easily.
Political and Economic Uncertainty
- China, currently the largest business travel destination in the world, will see negative repercussions due to its tentative trade positioning with the United States, the devalued yuan and the slap down on global casino companies' pursuit of Chinese high rollers.
- Despite political controversy in Philippines, this market will continue to grow at levels greater than the rest of Asia-Pacific, except perhaps for Vietnam.
- The devaluation of the Yen and Australian dollar continues to make Japan and Australia strong international destinations and promotes domestic tourism.
- Political and economic uncertainty will drive investors to real estate. Investment activity will continue in Asia-Pacific despite the lack of value deals; Australia in particular will maintain its current stance as a good place to park real-estate-designated cash.
- With Singapore as the sole Asian country currently ranked in the top ten for most innovative countries, Korea has been steadily pushing forward. We will see more "high tech/high fun" companies and solutions in the hospitality/food and beverage and travel industries coming from this part of the word.
- Millennials will continue to drive accommodation design and demand, since they have now surpassed baby boomers as the largest living generation and the most predominate world travellers.
- A new surge of sophisticated travel apps should be expected– focusing on connectivity between flights, taxi services, navigation, hotel services, concierge services and exercise.