Last month, in the setting of the stunning St.Regis Saadiyat Island Resort (Abu Dhabi), Marriott International held the first Hotel General Managers' Conference since the Covid-19 outbreak. More than 600 attendees including Anthony Capuano, President and CEO of the multi-billion dollar company, and David S. Marriott, Chairman of the Board of Directors, gathered at the conference, which was also the company’s very first event to group GMs of the entire EMEA region.
With the privilege of being invited by Satya Anand, President EMEA, and Sandeep Walia, Chief Operations Officer of Middle East, Marcelline Cordier and I, both recent EHL Alumni, landed in Abu Dhabi with, at first, little knowledge of the event to then return to Switzerland, three days after, utterly amazed and inspired by the people that we had encountered.
The conference provided the corporation with the opportunity to express gratitude towards their associates for their dedication and contributions to the company’s success, with “You make Us” being the event slogan. It was also a chance for industry professionals to come together after a period of economic recession and insecurity, receive updates on the state of the hospitality sector and Marriott’s health, while discussing emerging trends and the company’s future plans.
Here is what we learned after a full three-day immersion with the “makers” of the biggest hotel company in the world.
How bright is the future of the hospitality industry?
The economic impact of Covid-19 was widespread with a negative GDP growth experienced by around 90% of the countries around the globe. The post-Covid-19 economic outlook does not display a prosperous situation just yet: inflation endures (and it seems it will not go away so quickly), as geopolitical tensions hinder international economic boost and the labor market remains tight.
Indeed, the recession is expected to continue into the second half of 2023, but with a V shape (short steep recession and quick recovery) according to Leeny Oberg, CFO and EVP Development of Marriott International. Consumer spending is what drives the global economy, and the current data on household consumption is promising - especially for the hospitality industry: the US real consumption expenditure shows a +25% real growth for the section “hotels/motels”, a remarkable increase compared to other types of goods.
Might it be that after lockdowns, social distancing, wars and political crises, people are unwilling to waive their holidays? The data seems to show an evident “carpe diem” momentum, as in a turbulent situation of global instability, people value more experiences over goods. In fact, the travel industry has already shown strong, resilient growth in the subsequent post-pandemic months.
International tourist arrivals, which topped 1.5 billion in the pre-pandemic period (2019), collapsed to 409 million during Covid19 to catch up to 917 million right after (2022). Surprisingly enough, the luxury segment is the one to exhibit considerable growth (inflation-adjusted). Clearly…“Life is too short to postpone fancy travel”.
The wave of the worldwide industry recovery is certainly ridden by Marriott Int., leader in the luxury hotel industry, as Leeny Oberg reassured her associates by showing the brilliant company’s RevPAR recovery of the last year vs. 2019. The company’s global growth goals for 2023 are also loud and clear, with ambitious plans to build further on its net rooms growth of 10.5% in 2022! Marriott International is strong, solid and looking forward to addressing the big topics of the moment: people, data and sustainability.
Challenges to face and opportunities to grasp
1. Putting people first
One of the keywords at the conference was Gen Z. Various Marriott associates and external experts discussed the last generation of people that, on the one hand, is entering the workforce and, on the other, represents the newest customer segment. This generation’s view of the world can influence all its predecessors, as they show a deep sense of c . For this reason, Marriott Int. is already proactively listening and responding to the newest trends:
- Personal regeneration – while some generations might still consider it a taboo topic, Gen Z is particularly attentive to mental health and personal well-being.
- Relationship regeneration – having numerous connections is not in the scope of Gen Z, who prefer to thicken relationships rather than broaden them.
On the recruiting side, it is evident that the entire hospitality industry has suffered from the shrinking of its labor supply since the pandemic. After Covid-19, many field experts did not come back to work for an industry that seems unable to afford as much flexibility as others, especially in a new world where people call for work-life balance and flexible working hours.
Should the hospitality industry rethink the way we work? Could a General Manager, for example, ever work part-time in collaboration with other associates? Turning concepts upside down might not make any sense at first, just like challenging the status quo is never comfortable. Nevertheless, it seems that this industry is at a turning point.
Marriott Int. is open and ready to face this structural challenge, as it has already launched a new recruiting program and actively working on innovative empowerment solutions with its associates.
2. Becoming a data-driven company
Two main concerns were addressed at the conference in relation to the technological advancement of the hospitality industry:
- How can we leverage data? The company is creating an advanced customer database to understand what product they need to put in front of each customer.
- How can we protect our customers? The company discussed the importance of protecting data and respecting the basic right of privacy.
3. Sustainable business models
The discussions on sustainability were, by far, the most absorbing. How could a company as big as Marriott International ever be sustainable? The mission is not easy at all, yet because of its importance in this market, Marriott can scale its sustainable practices more accurately.
The company is gathering all the necessary information by collaborating with external partners to determine the size of its carbon footprint. It is also building clear KPIs to advance towards a sustainable business model that works with a significant reduction in carbon intensity, water intensity, landfill waste, food waste, and especially non-renewable use of electricity. In fact, the most significant impact for a hotel comes from electricity, which is why Marriott International commits to achieving a minimum of 30% use of renewable electricity.
Another top priority concerns responsible sourcing, for which the company aims, for example, to acquire 100% cage-free eggs and locally source 50% of their products.
The global company supports its hotels through the MESH platform (Marriott Environmental Sustainability Hub) to track its progress on the company’s sustainability-related reduction goals. Indeed, the conference was also an opportunity to connect with the General Managers of thousands of hotels to find common ground on the various sustainability requirements, such as acquiring the Green Key certificate, getting the Energy Audit and joining the Food waste reduction program.
Overall, by 2030, Marriott Int. commits to reducing its carbon emissions by 50% and to reach, by 2050, net-zero carbon emissions.
The strength of Marriott International
Three days meeting, discussing and sharing ideas with hotels’ General Managers from all around the globe were enough to make me realize the real uniqueness of Marriott International: its people. They are a (big) dedicated family, that stands united towards the various challenges and shares the same strong sense of hospitality.
I was welcomed as if I were part of their family and given the best hospitality service a guest could ever imagine, as well as the opportunity to share my ideas like everybody else in the group.
I was surprised to hear that most of the associates had worked for Marriott Int. for numerous years, since nowadays almost nobody works for the same company for more than a decade. One cannot assume to find such a positive engagement and strong sense of belonging in every company.
They couldn’t have used a better slogan for this conference – “You make Us”: their strength is their people.
Teaching Assistant in Macroeconomics & Microeconomics
