Market Trends

🏨 Airbnb stock dropped 14% in one day, as the company forecasted slowing demand and reduced projected third-quarter earnings to $3.67-$3.73 billion, lower than the anticipated $3.8 billion. Some former avid users have shifted back to hotels, citing a preference for consistent standards. Airbnb hinted at increasing hotel room bookings through its platform, reflecting a strategic shift to compete with hotels. ???? 2024-08-13.

✈ Global travel spending is set to rebound to over US$2 trillion by the end of 2024, matching pre-pandemic levels. North America, Europe, and Asia-Pacific are key regions driving demand. By 2023, the top seven Online Travel Agencies (OTAs) captured nearly 46% of global online travel spending, up from 40% in 2022. Recovery is uneven as China and Japan have not yet reached pre-pandemic travel spending. The travel market's growth is projected at a 6.0% CAGR from 2024 to 2028, outpacing the global economy.

🌿 By 2040, China expects 28% of its population to be over 60. Trip.com Group reports over $224.6 million spent by senior travelers on its platform. Catering to users aged 50+, the Old Friends Club was launched last quarter. Trip.com's "family cloud" feature assists elder trip planning. Senior Chinese tourists now favor mid to high-end travel, moving beyond just budget trips. Article date: Aug 28, 2024.

💸 Over 87% of GDS hotel reservations in 2024 are for business travel, surpassing 2019's peak. GDS connects over 600,000 travel agents to real-time hotel availability. Hotels with 40+ rooms located near business hubs, airports, or tourist spots are ideal for GDS listings. Evaluating factors like target demographic, location, demand, GDS fees, and technical capabilities is crucial in deciding if GDS is suitable for a property.

🍚 Soy Cowboy, a Pan-Asian restaurant, opened in Arlington, Texas inside the Loews Arlington hotel. Ben Berg of Berg Hospitality Group, a key figure in the Texas dining scene since 2015, established the restaurant with a unique concept focusing on shareable dishes. Soy Cowboy avoids the typical "hotel restaurant" feel by providing a separate entrance and aiming for a standalone fine dining experience. The team adapts service to accommodate convention crowds and Dallas Cowboys gameday visitors, striving for full fine dining service without sacrificing quality or speed. Despite operational challenges, it has received high service ratings on OpenTable.

🏨 Urban soft-branded hotels spend 12.6% of total revenue on sales and marketing, versus 7.3% for independent hotels. Despite higher gross operating profit (GOP) margins in independent hotels due to no franchise fees, soft-branded hotels boast higher EBITDA margins, benefiting from collective purchasing power for costs like insurance. Key trends were observed by August 27, 2024, highlighting the blend of brand benefits and operational flexibility in soft-branded hotels.

🏨 The hotel market offers three main options: traditional brand affiliation, independent operations, and since around 2000, soft brands. Soft brands blend brand benefits with operational flexibility, pioneered by entities like Morgans Hotel Group and Kimpton Hotels in the 1980s/1990s. Major hotel groups entered the soft-brand space in the 2000s, including IHG's Hotel Indigo (2004) and Marriott's Autograph Collection (2008). Other entrants include Hilton's Curio Collection (2014) and Hyatt's Unbound Collection (2016). A 2023 CBRE analysis found independent hotels in both urban and remote areas enjoyed higher GOP margins due to lack of franchise fees; however, urban independent hotels spent 18.3% more on sales and marketing labor costs compared to their soft-brand counterparts. Conversely, soft-brand hotels had higher EBITDA margins, potentially due to collective purchasing power. Despite higher revenue potential due to brand systems, soft-brand capital costs could be greater than for independents.

🏨 Marriott International opened its 600th property in the Asia Pacific excluding China with the Adelaide Marriott Hotel in South Australia. This is Marriott International's first property in South Australia, featuring 285 guestrooms and a 150-year-old landmark Adelaide General Post Office (GPO) façade. Since the first Marriott Hotel in the APEC region in Sydney in 1989, the brand has expanded to over 50 operating hotels, with close to 40 in the pipeline. Marriott's growth strategy also includes entering the midscale segment and focusing on community and economic impact, with 95,000 associates in the region and plans for nearly 10% to take new roles within APECs by the end of 2024.