Insights Type: Articles

Legal Issues for Sales Leaders in 2020

By Kaitlin Dunn, Writer, Hospitality Sales & Marketing Association International (HSMAI)

Steve Rudner is one of the leading experts in hospitality law. As the founder and managing partner of the Dallas-based Rudner Law Offices, he exclusively represents hotels. In fact, 30 years ago, Rudner filed the very first lawsuit by a major hotel company against a group for violation of its sales contract.

Rudner will be sharing his knowledge at HSMAI’s Sales Leader Forum on Nov. 5–6 in Dallas, where he will present “Headlines and Headwinds for 2020: Legal Issues for Sales Leaders’ Radars.” He recently spoke with HSMAI about what to expect from his presentation.

What will your presentation be about?

I’m going to talk about the most pressing issues related to group sales contracts, including some of the trickiest clauses we see, and share some creative responses to issues that salespeople confront. For example, at my firm, we get a lot of requests for clauses related to GDPR, but as an industry, we don’t educate people about what’s required or what the risks are, so we’re going to talk about this in a more interesting way than what people will expect.

Using this example [of GDPR clauses], the clause itself isn’t the issue. For comparison, if you want a clause related to the Americans With Disabilities Act, I can’t come rebuild your showers for you to comply, all I can do is write you a clause that says you comply once you rebuild your own showers. With GDPR, I can’t make you comply with privacy regulations, but once you do that, I can give you a clause that says you do.

We have to make sure our hotels understand how to comply with the law and how to resist requests from groups. The reason this is such a challenge is that a lot of groups come in with their own GDPR clauses. Hotels can’t make changes to their systems every time a new group comes in, just like they can’t provide more showers just because a group’s clause says they need them.

What do you hope people will take away from your presentation?

They will hopefully take away a lot of substantive knowledge that I will present in a more interesting way than normal. We can’t continue to explain things the same way that we always have and expect to get different results. We have to explain why clauses protect meeting planners and groups, and we need to understand their needs in order to understand the clauses. We have to take the time to step back and look at things differently.

I want to show some creative ways to enable hotels to capture sales. Meeting planners often show up with long addenda with clauses that are cleverly written to shift the risk to the hotels. It slows down the sales process and increases the risk to the hotel. I want people to understand the risks and problems in these addenda and how they are changing the sales process and how we can remain in control.

Why does hotel sales keep your interest after all these years?

If I hadn’t been a lawyer, I’d have been a director of sales. I love the hospitality industry, and it’s a very exciting industry to be a part of. I think there are parallels between being a lawyer and being a salesperson that a lot of people don’t see. Standing up in court is just a very big sales pitch. As a lawyer, you don’t know anything about the people in the jury box, you just have to tell your story and sell it to them, but without any of the other opportunities to woo them that salespeople get.

How I Got Here — Christi Davis, Loews Hotels & Co.

Christi Davis is vice president of the Loews Sales Organization and a member of HSMAI’s Sales Advisory Board.

If you would have asked my younger self what I wanted to be when I grew up, the answer most likely would have been a lawyer. My parents will tell you I started negotiating (they may have used the word debating), as soon as I could talk. Well, the girl with the knack for “negotiating” was bit by the travel bug when I spent a summer abroad in Sydney Australia. I came back to the states to graduate and a short few weeks later I was back in Australia, all but begging them to give me permanent residency. They politely declined and advised me to find a nice Australia bloke to marry or consider a job in the US that allowed for international transfers. Then they handed me my denial and told me to enjoy the last 72 hours of my time in Australia.

It was on the flight home I looked through the handful of internships I had completed, all surrounding sales + marketing for various organizations and matching said skillset to international organizations. And so began my career in hospitality. I started as a sales manager with select-service Marriotts in Carlsbad, California. Marriott offered a transfer program that I decided had my name all over it. A couple years went by and the idea of being so far from family became less appealing, but my love affair with hospitality was already well on its way. I fell in love with the profession and even more so with the discipline.

Marriott provided an incredible foundation with their sales training, and of course fantastic travel benefits, but I soon realized that select service was not for me. I set my sights on La Costa Resort and Spa, at the time a KSL property, and found my love of luxury.

After a couple years, I was determined to move into a leadership role and was recruited to move my career to Los Angeles as the director of group sales for The Hollywood Roosevelt. I moved around a bit in the Los Angeles market as I continued my career progression into different leadership roles, eventually landing at The Beverly Hilton. I started as director of sales, but I moved into director of sales and marketing shortly thereafter. I spent years at the iconic hotel and pretty much grew up there — wedding, babies, and eventually realizing I wanted to move on to the next challenge, the ownership and asset management side of the industry. I accepted the role of vice president of sales and marketing for Journal Hotels, a well-funded startup that owned, managed and was actively interested in acquiring independent assets across the US.

After a handful of years of travel, including weeks at a time when we were acquiring an asset, I decided it was time to move out of the startup world and acclimate back into the luxury space. I was recruited by Loews Hotels & Co in early 2017, and currently serve as vice president of the Loews Sales Organization, where I oversee the group operation of the organization, from national sales to group contracting, sales tools, and strategy.

My love for hospitality has never dulled. 17 years later I can still say I love what I do. This industry encourages engagement, creativity, and exploration. The discipline fuels my competitive nature and with the evolution of the sales discipline it also challenges my analytical side. Moving from the relationship sales concept to consultants or strategists that maintain the relational competitive edge but must challenge for the business is a daily inspiration. How can we be better today than yesterday? Im motivated by the potential of constant improvement. Something my husband may wish was not so much on the forefront of my mind in my personal life, as I don’t tend to shut it off at home. It’s apparently in my DNA. My job as it stands now is to be intuitive and push the boundaries. How can we improve? Improve processes, efficiencies, production, how can we stand out in a sea of large brands and luxury offerings and drive results.

My best advice, go after what you want, because the worst someone can say is no (and I would add) then prove them wrong. I also remember someone once telling me, “Operate as if you were in the role you want, not the role you are ”. And lastly, always see the strengths in others.

Spend Less and Deliver More?

By Juli Jones, CAE, Vice President, Hospitality Sales & Marketing Association International (HSMAI)

With many companies in the process of planning their budgets for 2020, HSMAI’s Marketing Advisory Board (MAB) recently discussed the possibility of an economic downturn and what that would mean for hotel marketers in the coming year. Here are three takeaways from the conversation:

1. Reading the numbers: When you analyze the hotel industry’s stats, you see that ADR, RevPAR, and occupancy have fallen since the first quarter. The statistics look similar to those in the late 2000s as we approached the last recession. An MAB member noted: “When this downturn hits, … we’ll have to see if the industry hangs in and keeps rate integrity, or if they just decide to push rate to move volume. If that happens, you’re going to have another big dip.”

2. Customer experience: Focusing on the customer experience is the best way to come out ahead during a downturn — and a better customer experience can be used to justify charging more than competitors. “When the entire block or street goes down to $95 a night, it’s hard not to, unless you have something that’s holding you up,” one MAB member said. “It has to be built over time. It can’t be done when the downturn starts. It has to have been done before.”

Another member added: “If you have better reviews, that should be a measure of the quality of the experience you’re producing. That should yield some sort of price premium. So, the key is focusing on guest satisfactions.”

3. Upside vs. downside: Several MAB members were concerned that marketing budgets were going to be cut and are thinking about cost savings in their budgets in case of a downturn. Opinions were split over the positives and negatives of potentially shrinking budgets. “There may be an upside, actually, to a downturn,” one member said. “When people are looking at shrinking expenses and doing more with less, you’re going to have to break down the silos a bit. What we’ll end up with is a little bit better integration of digital and revenue management.”

Another member agreed: “If you can get your act together and reinforce yourself and solidify your position during the downturn, you will have an opportunity. You can position yourself well to come out of it.”

But at least one MAB member is worried that a downturn will have the opposite effect because companies will take fewer risks. “The people that I work with aren’t panicking,” the member said. “They’re just starting to be a little bit more cautious, which is kind of a drag, because they’re being less innovative, because they’re afraid of risk. I’m seeing that people are starting to be less willing to try anything new: ‘Let’s pull back a little bit, be a little more conservative, shift our channels.’ That’s what I’ve seen.”

“It’s a different type of innovation,” another member said. “Having to find ways to spend less and deliver more.”

How I Got Here — Jonathan Kaplan, IHG

Jonathan Kaplan is vice president of global sales strategy at IHG and a member of HSMAI’s Sales Advisory Board.

As a kid, some of my favorite memories were traveling with the family on our summer vacations, usually staying at a Holiday Inn. My passion for the travel sector comes from the ability to help create those same memories and experiences for others and deliver true hospitality for all.

I earned a bachelor’s degree at the University of Florida in Gainesville, where I majored in business administration with an area of specialization in hotel management. I started my career working in an advertising firm handling Wyndham Resorts, where I was designing their kids’ club program. I then moved to a “management in development” program at Wyndham, where I was the assistant F&B manager while completing the training program. I finished that in a year and moved into a business travel sales manager role at the Wyndham Washington DC City Centre.

After that I worked at W Hotels of New York as a business travel sales manager for the five W’s in NYC. I served in a group role at W before moving to Starwood global sales, handling business travel for five of the top 20 accounts, and then worked as the managing director, leading the global relationships for five of Starwood’s top 20 accounts. Also at Starwood, I worked to develop the company’s global airline strategy. I was then director, NBD and digital programming, where I worked with all the non-B2B-facing groups within Starwood to help them understand the B2B customer and was the business lead on SPG Pro. My final role at Starwood was as the director, global leisure and luxury sales. This was the last segment of B2B that I had not experienced.

Currently I am the VP, global sales strategy, at IHG, where I lead the ideation and execution of our B2B strategy across each of our B2B segments. I am responsible for the ideation, evolution, change management, and execution of sales strategies across our B2B sales segments on a global level. These segments include corporate travel, travel management companies, groups and meetings, group new business development, airline, wholesale, and business edge (IHG’s small-medium enterprise offering).

When looking at opportunities, the best thing to do is think about what new skills you are learning to add to your personal toolbox. Do not focus on title and pay as much, because if you focus on honing your skills, the title and pay will come. I have had the pleasure of working for some exceptional bosses (Asad Ahmed, Alice Caravello, Betty Wilson, Mary Casey, Christie Hicks, and Derek DeCross), who have invested so much of their time in helping me develop my personal leadership style, and I owe it to them to do the same for the next generation of hospitality leaders.

Don’t Let Fear Control You — Takeaways From ROC Keynoter Judi Holler

By Kaitlin Dunn, Writer, Hospitality Sales & Marketing Association International (HSMAI)

Speaker and improviser Judi Holler encourages people to get outside of their comfort zone in order to be more successful in their careers. She offered a variety of tips for doing that during a keynote presentation at HSMAI’s ROC 2019 event — as you’ll see in these videos as well as our roundup below:

Get comfortable with being uncomfortable. None of us have a script, so we just have to keep moving forward. We miss opportunities when we stay in our comfort zone, which leads to regrets both personally and professionally. “If you ever want anything to happen, if you ever want to change your life,” Holler said, “you’ve got to get scared, and you’ve got to get uncomfortable.”
Be the boss of your own fear. Fear is what is responsible for robbing you of opportunities. Focus on managing your fear instead of being fearless. “We’re focused on being fearless, but what we should do is chase the goal of fearing fear less,” Holler said. “That is what makes you brave.”
We can’t let mistakes stop us. It’s scary to put yourself out there, but to accomplish anything, you have to. “Scary things don’t get less scary, but you will get stronger,” Holler said. “If you want to become memorable, you’ve got to have the guts to be memorable. It’s not someone’s job to remember you, it’s your job to make sure they don’t have a chance to forget you.”
Get uncomfortable every day, on purpose. Start small, by conducting daily fear experiments. Do something that gets you out of your comfort zone, like asking questions or speaking up, and build up to doing bigger things. “When you can manage your fear, you will become more innovative, outgoing, joyful, and healthier,” Holler said. “You’ll take more risks, make things happen, and realize that your voice matters.”

New Incentive Plan Research Yields Varying Results

By LaDonna Gerhart, Executive Vice President of Sales and Marketing, Remington Hotels, and Allison Handy, Senior Vice President of Marketing, Prism Hotels & Resorts — both members of HSMAI’s Sales Advisory Board

New research from HSMAI and ZS Associates presented at HSMAI’s Hotel Management Company (HMC) Sales & Marketing Executive Roundtable in May studies the sales incentive plans for 39 different HMCs. HSMAI’s Sales Advisory Board (SAB) discussed the key findings on a recent call, including:

The primary metric for incentive compensation varies by position. While 81 percent of the payout for sales managers is related to their individual contribution, only 23 percent of the payout for directors of sales is related to their individual contribution, with two-thirds based on total hotel contributions.
The majority of incentive plans are capped. The maximum payout for directors of sales is 30 percent, a reduction of 5 percent from a previous study conducted four years ago. Sales managers’ maximum payout is also 30 percent — but this represents an increase of 2 percent from the previous study.

Quarterly vs. yearly: The SAB discussed potential implications for bonuses if there is an economic downturn, including how compensation programs may change. Members agreed that, with changing goals and market conditions, it’s important to have quarterly incentives instead of yearly. Out of the surveyed plans, 80 percent were quarterly, and 21 percent were both quarterly and annual.

Brands and vendors: Another member added that they would like to see how HMC incentive plans compare to plans from other companies, such as brands and vendors. “I think that’s really important to do as well, because we’re competing against those companies to retain our salespeople,” the member said. This was especially important because the study revealed that “one of the biggest dissatisfiers from salespeople is their confidence in the goal- and quota-setting process.”

Beyond base salary: An SAB member remarked that other industries do a better job of attracting salespeople by focusing on top-line and potential salary as opposed to current practices in the hotel industry. “The one piece of this that I think has to change is that we sell our position based on base salary,” the member said. “We hire people and say, ‘I’m going to pay you $50,000 as a salesperson and you have the potential to earn another 50 percent on top of it.’ Selling the total compensation package is what every other industry does. But in our world, we say we’re going to hire you at $50,000 base and in small print somewhere, we say you’re going to earn this much incentive.”

There is also a difference between how tech salespeople get paid and how hospitality salespeople get paid. Tech salespeople don’t get paid until the business is completed, but in hotel sales, blocks often are booked multiple years out, an SAB member noted, so forcing a salesperson to wait that long “simply wouldn’t work.”

Upcoming study: SAB members spoke an upcoming HSMAI study that focuses on management company processes for goal and quota setting which is scheduled to be presented at the fall management company round table. “We’re excited to see what that will uncover,” one member said. “I think we’re going to add another big piece of information to the toolbox.”

HSMAI shortly will be releasing its research on HMC incentive plans as a special report. Check www.hsmai.org for details.

3 Challenges Facing Hospitality Curriculums — and 3 Solutions

By Kaitlin Dunn, Writer, Hospitality Sales & Marketing Association International (HSMAI)

With more colleges and universities than ever offering degrees in hospitality and hospitality-related fields, the talent pipeline for hotel professionals has never been more robust. But even as hospitality educators work to guide the development of the next generation of industry professionals, there are challenges. International Council on Hotel, Restaurant, and Institutional Education (ICHRIE) provides a forum for them to share their knowledge, research, and resources with each other and connect with industry innovators, strengthening their collective ability to influence and train future hospitality leaders.

According to new research conducted by HSMAI, while marketing is well represented in the curriculum at U.S. hospitality schools, many are lacking in sales and revenue management programs. Indeed, only 27 percent of the 100 largest hospitality programs have a required sales and/or revenue management class, while 52 percent don’t offer any sales classes and 44 percent don’t offer any revenue management classes at all. Contrastingly, 92 percent require marketing classes:

Hospitality Sales, Marketing, and Revenue Management Curriculum at Top 100 U.S. Hospitality Schools Ranked by Enrollment Size
	SALES	MARKETING	REVENUE MANAGEMENT
Offer required/core classes	27	92	27
No core classes, but offer elective classes	21	5	29
Offer no classes	52	3	44
TOTAL	100	100	100

SOURCE: HSMAI

With this in mind, HSMAI President and CEO Robert A. Gilbert, CHME, CHBA, led a meeting of the special-interest group for hospitality sales and marketing educators at the ICHRIE Summer Conference and Marketplace in New Orleans last month. During the meeting, hospitality instructors discussed several common challenges facing their students today and shared some ways of overcoming them.

CHALLENGES IN TEACHING SALES AND MARKETING

Misconceptions: One meeting participant sees students come in with the idea that all sales jobs look like that of a used car salesman, and they look down on that. “The image of a career in sales isn’t something people think of,” the participant said. “But once they get through the class, that attitude is completely changed.”
Overload: Another challenge a participant mentioned is narrowing down and prioritizing what to impress upon students. “It’s hard to figure out what students need to know, because of the breadth of what’s involved,” the participant said. “Things change quickly, and we have to keep the updated content and let students know that in marketing, it’s not just what’s in textbooks, it’s what’s happening out there. The breadth and the speed make it challenging.”
Rapid pace: Another participant also stressed that the rapid pace of the marketing and sales world makes it a challenge to teach. “I think things are happening so rapidly, it’s trying to get students to know how they can analyze things and do critical thinking,” the participant said. “By the time they get out [of college], things will be different.” Another participant agreed: “The world moves fast. The students are more tech-savvy than we are. We need to keep up.”

SOLUTIONS FOR TEACHING SALES AND MARKETING

Hands on: One participant said that a hands-on learning style teaches students about the world. “It’s all about the process of doing sales, showing them how to interact with someone, asking questions, doing all the things that professional salespeople do,” the participant said. “And recognizing that sales is a process. Students come out saying, ‘I didn’t know this was what sales was about.’”
Field work: Another participant advocated for helping students experience the realities of a career in hotel sales or marketing. This participant’s classes get to visit businesses in the area and interact with hospitality professionals. “That was eye-opening and did a great job of getting students interested in going into the sales field,” the participant said, “even for those who didn’t think about it before.”
Special guests: Conversely, one participant suggested bringing professionals into the classes. “One of the best things you can do is bring in an asset manager and a revenue manager, and have them talk about the relationships and dialogue that occurs between them,” the participant said. “That is so valuable.”

Gilbert agreed, stressing the importance of introducing students to professionals in the field. “They’ll help you where you may not have the tech skills or lingo the industry does,” he said. “They can be great in the classroom or to have students shadow.”

He also offered advice that he shares with students that he speaks with. “Sales is an important skill. You can use it anywhere,” Gilbert said. “In sales, you are closer to the customer than anyone else. It’s a unique, valuable point of view … in any business.”

Remote Work, Flex Time, and Other Secrets to Talent Retention

You may have noticed that it’s gotten hard to attract and retain talented hospitality sales, marketing, and revenue optimization professionals. And you may have concluded that it’s because of the strong economy, especially the U.S. unemployment rate’s 50-year low.

But that’s only part of the story. Just as important, according to Rosemary Browning, president of Global Career Horizons, an international search firm that specializes in revenue management for the hospitality and travel sector, is what today’s younger professionals want — and don’t want — from their employers. “It used to be that people were eager to climb the corporate ladder, no matter how that ladder was,” Browning said in a recent interview with HSMAI. “If it took them overseas, if it took them someplace else, that was okay — they were eager to do it. Now, they’re just not. They want a balance of life. They want to be able to be there for their family. Dads are taking a much more active role with their families and they don’t want to be away as long. They’re taking lateral moves and sometimes a step back, just so that they can have that balance of life.”

The key, Browning says, is to offer your employees flexibility — including to work remotely and visit the main office or client sites as needed. “It’s not just about, ‘Okay, well, we have one remote person working,’” she said. “That just doesn’t work. It’s about being set up for remote success for all employees.”

How do you succeed with remote employees?

When you’re in an office environment, people run into each other. You’re able to check in. Being in the office is much more conducive to connecting and communicating with people. You need to be able to do that remotely, and that can be hard. A lot of times, remote employees are not invited to meetings. They’re not thought of as part of the team. That mindset has to change. Because hallway conversations and those touchpoints don’t happen, and when meetings are started no one opens up the conference-call line for that person to join in. Those things result in failure.

From a remote person’s perspective, they need to work harder too to make those things happen. They have to check every meeting invite to ensure that there’s some way for them to be on phone calls. Make sure their ideas are being heard, so that they can be part of the conversation and have positive feedback in the loop. Those things will ensure that that person’s not likely to be forgotten.

From a company standpoint, the right technology is vital, but it only works if it’s embraced and used correctly. You can have awesome technology, but who cares if they can’t run it correctly and they don’t use it. One technology company piece that works really well — I’m sure you’ve heard of it — is called Slack. It enables teams to be remote and still be engaged, including video calls. You can have your ideas stored in one place and organized by topics automatically, and different types of data sharing such as Dropbox, or other document-sharing services. But like I said, it only works well if everyone’s on board and everyone uses it.

On the flip side, how important is it to also establish expectations for remote employees?

Absolutely vital. Just like with any type of position, expectations and goals up front are a sure line of success, so that everyone’s on the same page and everyone understands what their role is to make a remote position successful.

I think it’s very old-school for companies to think, “We absolutely need someone here.” Well, there are some cases where you do and that’s not going to go away, but in many cases, there are smaller accommodations that can be made to make things more successful. From a recruiting standpoint, what happens is that if companies are so set on “We have to have this person here,” what they’re doing is limiting themselves to the expertise and the type of person that is able to apply for that position. You’re looking at a very small pool.

And a lot of people in that pool just aren’t interested in doing things the way they’ve always been done. For example, they’ll make a lateral move rather than continuing to seek promotions.

Absolutely. I’ve had a number of people whose bosses have said this person is great to promote, and when you talk to them, they say, “You know, because of my balance of life, I don’t want to do more. I’m happy with what I’m doing, and I’m going to stay here.”

Is the entire model for career advancement starting to come apart?

I wouldn’t say coming apart. I would just say it’s changing, because I’d have to say there are sometimes when people make those decisions, I might say to myself, “Oh gosh, I’m not sure I would make that, that’s a bad decision.” But then, the individuals who have stayed strong and stuck to what they believed in, they’ve done really well and they’re happy. Their priorities are different and they’re making it work for them.

The other thing I see is that the younger generations don’t want big homes. They like smaller homes that are simple, so they can travel and they can do other things. I admire that. It’s just a different mindset that companies need to embrace and to accommodate.

What else should hospitality companies keep in mind when it comes to recruiting?

In terms of benefits, I’m seeing more people asking for things such as flex time. That’s very important. Vacation time with family — that seems to be more important than actual compensation. Being able to say, “Hey, can I come in early?” Or, “I’d like to work from home at least one day a week or two days a week, just so that I can pick my kids up.” The companies that are very rigid, they do have a very hard time recruiting and attracting the right people, because I think their mindset is just so old-school.

Curate Update: A Little More About Design Thinking

By Christopher Durso, Vice President of Content Development, Hospitality Sales & Marketing Association International (HSMAI)

The centerpiece of next month’s Fall Curate 2019 program — an exclusive Executive Insights Forum for HSMAI Organizational Members — is a hands-on workshop on design thinking, which in a previous article we described as “a human-centered approach to creative problem solving” that can be used to address seemingly intractable challenges. Such as? Convergence and collaboration among hospitality sales, marketing, and revenue optimization professionals and departments!

Learn more from Marc Bolick, managing partner of DesignThinkers Group USA, who will be running our Curate workshop:

How do you define design thinking?

It’s a problem-solving methodology. The biggest differentiator between design thinking and other methodologies is that it’s based on empathy for the people that you’re designing for. It puts the people you’re designing for at the center of the process as opposed to starting with the technical feasibility or the business viability. It’s also different in the sense that you spend a lot of time finding the right problem to solve. We call that framing the challenge versus jumping straight to solutions. We spend quite a bit of time in an exploratory stage of unpacking the problem and building empathy for people before we’re even able to say, “Okay, this is really what we need to solve for.”

Are there particular types of problems for which design thinking is well suited?

There’s two parts to the answer. The first part is, it can be used and applied across a really broad spectrum of types of problems or challenges. There’s a couple of Stanford people who have written a book called Designing Your Life that uses design thinking to basically do what it says on the cover — essentially, to think about your life and your career and how you see yourself in the world, and and use design thinking for that. That’s an example of how broad and how versatile the methodology can be used. It really is very good at problems that are poorly bound, where there’s a lot of different stakeholders involved and a lot of moving parts or complexity.

I would say it’s not the right methodology for improving a process or an existing system. Six Sigma is really good at improving quality and taking out defects and taking out costs based on repeated process. Design thinking is not the methodology to use for that. Equally, I would say that design thinking’s not for problems where you’re solving a technical issue, because it’s not a technical-based problem-solving methodology. Although it has roots and foundation in the scientific method, it’s more for problems where you’re focusing on the people that you’re designing for and then you just work back from there to, “Okay, how can we get it to work and is it financially sustainable?”

What will the workshop you’re leading at Curate look like?

The first thing we’re going to do is level-set people on what design thinking is. We’re going to make sure that everybody understands the basics of design thinking. We do that as briefly and concisely as we can, giving some examples, because we always talk about design thinking as being something that you have to do to learn it. And then we’re going to pick what we call a design challenge — a problem area, if you will — to explore, and we’ll use some of the tools and activities that I referred to, to explore that problem area.

We’re really just trying to skim across a few points that we think are really interesting and activities that will expose them to some of these tools, so they could literally go back to the office and use them the next day. What we’re not expecting them to do is to do design thinking from end to end the next day. We’re just going to give them some simple, versatile activities that you can use in a context that’s outside of that full design thinking process but have their foundation and their roots in design thinking and in this empathy thing.

It is, as I said, what makes design thinking different from other problem-solving methodologies. It’s empathy, and that’s one of those things that you don’t learn in college. But that is the key differentiator of design thinking — this idea that you need to understand who you’re providing value to. These tools that we’re going to give people are going to be tools that act as an interface for them to have a conversation with other people about the types of people that they’re serving.

Fall Curate 2019 will be held at The Breakers Palm Beach on Sept. 4–5. If you’re not already registered, check with the primary contact on your Organizational Membership to see if you might be able to attend.

The Ever-changing World of Fees

By Jennifer Hill, CRME, Vice-President, Client Solutions at Kalibri Labs and Brian Hicks, Vice President, Global Revenue Strategy at IHG, members of HSMAI’s Revenue Optimization Advisory Board

On its monthly call in June, HSMAI’s Revenue Optimization Advisory Board (ROAB) discussed Booking.com’s decision to charge commissions on resort fees — a conversation that was reversed in July when the company announced it was delaying implementation of the policy until January 2020. But then several other fee-related news stories popped up recently, including Marriott being sued by the city of Washington, D.C., for leveling deceptive charges , Expedia announcing that it would not charge resort fees, and Airbnb eliminating some guest fees — leading the ROAB to use its most recent call once again to discuss the changing world of fees.

These issued raised questions among ROAB members about the importance of transparency and the impact these developments will have on the industry, especially when the outcome of the lawsuit is not known and could set a new precedent. One ROAB member said that from a consumer standpoint, not putting fees in the upfront price seems to be a deceptive practice.

Another member pondered where most customers draw the line and would cancel a reservation when fits hit a certain limit. “I don’t know if, as an industry, we can point to data that says when the fees are 30 percent more or 40 percent more, what the threshold is,” the member said. “But there’s definitely folks that are sick looking at that data and it is making an impact.”

Another ROAB member said that he has not seen a lot of pushback on fees in guest surveys or on social media. “I’m sure that there’s some people who are deciding not to purchase this because of these fees, but they are certainly not complaining about it once they get there,” the member said. “If you’re upfront about it, if people are aware of it, if they’re not surprised when they get there, then they’re the one who made the choice to buy it, so they can’t really be mad about it once they’ve done that.”

One ROAB member brought up service fees, which differ from typical resort fees in that they go directly to staff or third-party employees, and noted that Booking.com and other OTAs that may in the future charge commission on resort fees could see the commission as a service fee that they are entitled to. “A lot of it in the messaging has just gotten really commingled to where, from a hotelier’s point of view, we don’t know if we’re being punished or penalized for charging a fee to begin with,” the member said, “or a service charge just out of principle because we haven’t cut in a third-party [OTA] on that revenue.

“One thing I don’t think that third parties have done very well on is communicating what the endgame is,” the member continued. “Is that for them to make more money, do they feel like they’re shorted, or are they really just trying to improve the customer’s experience with transparency? It seems like a lot of the message that has come out from various partners or in lawsuits is that the intent is this pro-consumer standpoint, to punish hotels who are not transparent.”