“Thought leadership” is a becoming a ubiquitous term in today’s business landscape. The hotel industry is not immune to its allure.
In a world where search engine optimization increasingly is being driven through quality content (and lots of it), marketers of every ilk are leveraging the expertise of their team through white papers and thought pieces and other shades from the expanding palette of content marketing.
This trend is all well and good; there’s nothing wrong with showcasing expertise to drive commerce.
But wary are those who begin to value thought leadership over plain ol’ doer-ship.
That’s the moral of this week’s resignation of Starwood Hotels & Resorts Worldwide’s Frits van Paasschen, who for seven years was always one of the smartest minds in the room at hotel events and conferences. Whether waxing eloquently on the “golden age” of hospitality (a term he derived by culling global demand trends and projections) or painting a picture of a tech-enabled future, van Paasschen’s intelligent and articulate observations always projected his position as being one firmly on the bleeding edge.
He was a slick showman in a world of milquetoast operatives. He could hold an entire room just as easily as taking hostage one’s attention during private conversations.
But he never conjured confidence on Wall Street.
This much was felt during van Paasschen’s embattled final years as president and CEO, when on earnings calls analysts and investors fired veiled (and sometimes not-so-veiled) criticism like bullets from a firing squad.
Van Paasschen’s top-level thought leadership was fine and dandy. They just never saw it materialize on the bottom line.
Case in point: During van Paasschen’s seven-year tenure at Starwood, the company grew its hotel count by 34.7%. In a vacuum, that’s not bad. But in relative terms, it’s well behind the pace of competitors such as Marriott International, which grew its footprint by 42.9% during the same period.
For global hotel franchisors, unit growth is everything—particularly in the asset-light context, where fees drive the majority of revenues.
That Starwood only added 7,406 net rooms during 2014 is inexcusable, especially in this so-called golden era of hospitality. (Marriott, again by comparison, added 12,754 rooms.)
The company’s top brass recognized as much. Starwood’s chairman of the board, Bruce Duncan, summed their collective sentiment thusly: “We want to do better.”
That meant pulling their thinker and tapping a doer—at least on an interim basis.
“I’m someone with a bias for action—prudent and wise action to be sure, but action nonetheless. … I have no intention of merely being a caretaker,” said Adam Aron, interim CEO. “Our board has given me a clear mission and charge to get certain things done.”
Look to Starwood to start pulling previously off-limit levers to do just that.
A brand acquisition? It’s possible. Launching a more affordably priced brand to spark further franchise growth? I wouldn’t be surprised.
Leave the thought leadership to the marketers. It’s time for Aron and the rest of Starwood’s development team to roll up their sleeves and get to work.
Now on to the usual goodies …
What’s making me happy this week?
Hotels in the movies. I’ve always loved the Academy Awards, which this year are being held 22 February. So imagine my delight when this nifty article landed in my inbox last week, compliments of Steve Hennis at our sister company STR Analytics.
In it, Hennis shines the spotlight on the many, many, many hotels that have either provided the backdrop for some of your favorite cinematic delights or, in certain cases, served as one of the stars themselves.
That the article includes an interactive map that allows users to sort by genre, awards and actor makes it all the more fun.
Stat of the week
54.4%: U.S. occupancy rate during the month of January, according to data from STR, parent company of Hotel News Now.
The number is notable for two reasons: First, it’s the highest of any January on record. And second, it’s still relatively low when compared to the rest of the year. (Nearly half of all rooms sat empty during the month.)
Quote of the week
My favorite quote of the week was the one from Aron cited above. (“I’m someone with a bias for action …”) But I’ll avoid duplication here and go with this one, compliments of Starwood Chairman Bruce Duncan:
“This is something that’s been building over the past few months.”
Pulling your longstanding CEO isn’t a knee-jerk decision. Starwood’s board clearly was mulling the move for a while now.
Reader comment of the week
“It’s about time - new brands are great and ‘fuzzy’ feelings are super, but there was NO operational experience and focus on day to day. As a former Sheraton GM, I hope new management really focuses on catching up to the other big players.”
—Reader “Anonymous” responding to news of van Paasschen’s resignation.
Email Patrick Mayock or find him on Twitter.
The opinions expressed in this column do not necessarily reflect the opinions of Hotel News Now or its parent company, STR and its affiliated companies. Bloggers published on this site are given the freedom to express views that may be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to comment or contact an editor with any questions or concerns.