CWT's Matt Brennan talks to Karen Yue about his role as vice president of hotel operations and why it is a critical function
Yours is a newly created position and for a division that is rather rare in a TMC. Why is it critical for CWT to have a Hotel Operations division and how will this benefit CWT’s clients and their travellers?
The landscape of business travel is changing and CWT is making bold investments in innovation and our people. Hotels are a key focus area for us and I believe there’s still a lot than can be done to improve the traveller experience in this space.
Having a dedicated Hotel Operations organisation will enable us to implement solutions faster and more systematically across the world.
CWT already has a tremendous amount of hotel content – nearly 500,000 properties around the world. The challenge is making this content available to all our clients across the globe. The Hotel Operations division will be responsible for streamlining implementation, and ensuring that the hotel content we offer our clients is available across all our booking channels, both offline and online, and across all markets.
This approach will help us provide a more consistent hotel booking experience for our clients. It will also enable us to provide better value for clients and their travellers by helping us contract the best rates and availability with hotels.
I am excited to be in a position to help CWT really focus on the dynamic hotel and accommodation needs for businesses and their travellers. In order to create a seamless and consistent experience for travellers, we will pursue a deeper understanding of the different travellers in the client’s organisation during an accelerated and specialised onboarding process. This way travellers are even more satisfied with their tailored experience, faster.
Does sharing economy accommodation suppliers sit within the care of your division? Airbnb struck a partnership deal with CWT in mid-2016. How do you balance them with your traditional hotel suppliers?
All of our accommodation supplier relationships are managed by our Hotel Supplier division.
We are in process of implementing our first pilot clients with Airbnb and this will help us understand the real appetite for these suppliers in the managed corporate travel space. A study published by CWT Solutions Group (*) indicated that just 2.5% of travellers whose travel policies allow Airbnb bookings have actually used it. We already know that the sharing economy is a key option in hotel pricing for markets in Asia-Pacific including Japan, Australia and New Zealand. Drivers include a lack of supply and prices up to 50% cheaper than a comparable hotel option.
On the other hand, traditional suppliers like hotels and serviced apartments offer a high level of service and consistency across their properties, which is difficult for sharing economy providers to match. Moreover, travellers that require assurances such as fire detection systems, deadbolt locks, safes and more, may not find these services in sharing economy property.
That said, some companies like Airbnb and Uber have launched offerings targeted specifically at business travellers that aim to address many of these concerns around safety, service and consistency.
Ultimately, the decision on whether to include services like Uber and Airbnb in a travel programme lies with the client. These services are a good fit for some travel programmes, but they may not be right for all. Whether or not the sharing economy is a good fit for any given company will depend on their company culture, their appetite for something new, and their risk management policies, among other things.
Corporate clients' regard for sustainable meetings and events is growing, and in a recently published study on Chinese Meetings & Events Meetings & Events habits by CWT, 52.6% of respondents voted sustainable meetings and events as an important trend. How does this impact your work with hotel partners and matching them with this growing focus on green events?
When working with hotel suppliers, we can facilitate a request for a summary of their green initiatives to share with our clients. This reinforces the precedence that these are important to us and our clients.
Although 52.6% of respondents surveyed voted sustainable meetings and events as an important trend, this was actually the lowest ranking element. This is an indication that the meetings and events industry in China is in an early phase of its development, where consolidation of spend and suppliers, as well as adoption of technology, remain the top priorities.
For Meetings & Events clients, consolidation of meeting spend is at the top of the list. There is a stronger focus on knowing the suppliers you are working with, which in a lot of cases includes a screening process by a third party. Working with a reduced number of suppliers makes this process easier and more cost effective.
How do you foresee hotel consumption performing in the various global regions in 2017, with macroeconomic considerations in mind, and how do you expect hotel partners to respond in terms of corporate rates and offers?
We are seeing relatively low, inconsistent and in some cases fragile economic growth. Hotel rates globally will grow slowly, with the biggest impact in the Americas where rates are expected to increase by 4% (*). Mega hotel mergers are grabbing headlines, but their impact on prices likely won’t be felt until 2018. Hotel services such as room service, laundry and security remain important to corporate travellers. Traditional hotels, therefore, remain an attractive option for business travellers, despite the sharing economy options.
(*) 2017 Global Travel Price Outlook, July 2016
(**) The sharing economy: Here to stay. Now what?