Transform Tomorrow – Radisson Hotel Group

In the lead up to the 2020 Arabian Hotel Investment Conference (AHIC), we asked a number of industry partners how they are transforming their business for tomorrow.

The fall of Venice as an empire in the 18^th century may have been attributed to three prominent factors: the change of trade routes, foreign threats and the empire becoming more and more embroiled in shifting geopolitical developments. However, most scholars tend to overlook the rise of power within the political elite, leading to closed circles of wealth and influence. This in turn led to restricted competition discouraging the entry of new players into the marketplace, obstructing innovation and, subsequently, leading to a gradual decline in the overall population and economic standing.

Civilisations, empires, countries, economies, industries, companies, and individuals thrive on innovation and fall in the absence of innovation. Through the course of history, ideologies, companies and products flourished on new, disruptive ideas. Many, however, failed because they simply could not cope with changing trends. The hospitality industry and its stakeholders, from the consumer to the asset owner, from the operator to developer are no different.

Consumer trends and hotel designs: The definition of expected comfort and luxury provided by hotels is also continuously changing. It is no longer about opulent furniture, marble tops and gold taps. Today's hotel guests are looking for convenience. Business and/or leisure travellers now look for conveniently placed USB portals to charge their devices (soon to be innovated to wireless charging portals), rain showers, ergonomic mattresses, fresh restaurant concepts, functional designs and innovative guest-facing technologies such as online check-in.

Experiential travel and its ripple effect: Travel is now increasingly becoming about experience over materialistic gain. Hotel operators are going out of their way to create concepts that engage with the local community such as agro-tourism, encouraging local produce, promoting health, wellness and activities and helping guests discover a destination's natural surroundings. It is also to create demand from the local community as much as it is for the local community. This will help hoteliers and destination planners keep an open mindset in finding ways to grow attractive market segments as well as in attracting new feeder markets to reduce the risk of reliance on traditional sources. Such innovative steps will help major players remain vigilant with changes in the world around them, be it fast-paced changes in consumer trends or geopolitical developments.

Competition and its opportunities: This constant need to innovate will keep bold players in their game. Those who do not will inevitably continue to lose market share and competitive edge. Innovation does not see disruptors as a threat, but rather an opportunity to improve. The rise in the need for budget and midscale hotels has pulled many international operators to compete in that segment. The attractive profit margins achieved by serviced apartments made hotel operators work more closely with owners to standardise such a product. The growing need for lifestyle brands brought many operators to realise the attractiveness of such a product if they are to remain competitive. The move towards consolidation among hotel giants has made smaller operators realise the importance of such a move as loyalty programmes become worthy demand drivers and distribution engines gain more power and reach. It is about working with, and incorporating elements of, the shared economy industry in all its forms. It is about embracing online travel distribution rather than attempting to beat it. It is about managing data technologies more efficiently. It is about understanding the strength of standalone food and beverage brands, concepts, solutions and successes, rather than trying to replicate concepts that risk under-performing under a hotel operation.

Owner relationships and creative solutions: Innovation does not stop at operational requirements or marketing strategies but stems from the first meeting with a hotel investor or owner. Collaboration between both parties will continue to strengthen whilst a strategic alignment is created. Operators are now making more effort in designing real estate efficient products for investors to develop. It is less about trophy assets and more about viable investments with healthy profit margins and sound returns. It circles around finding creative financial solutions and contract options as operators work more closely with developers, understanding investors' financing requirements and development commitments. It is becoming more of a long-standing, sustainable partnership rather a short-term business transaction.

Responsible business and adding value to life: In addition to the inclusiveness of local communities, having a sustainable approach to the environment and the society in which a business operates will have a comprehensive impact on all layers of an economy. Such innovation has helped hotels reduce their operating costs and decrease their carbon footprint, but on a wider scale, this has also helped create thousands of job opportunities, promote cultural activities related to food, music, entertainment, art, to name a few, and contribute to the overall social fabric of the society in which we operate.

''Transform Tomorrow'' is not a mere end, but rather a forward-looking journey of vision, innovation and success. And in that journey, history will continue to be written, not only in legendary hotels across historic cities worldwide but within creative offerings that will continue to transform experiences in every corner of the planet.