A dynamic pricing strategy is key to success in the hospitality industry: Adam Aron

Interview with Chief Executive Officer, Starwood Hotels & Resorts Worldwide Inc

Our brands are only as strong as the associates who bring them to life every day, Adam Aron tells Ankita Rai

Starwood Hotels & Resorts Worldwide recently introduced Sheraton Grand. What is the rationale behind launching a new brand?

We are elevating our top Sheraton hotels to this new Sheraton Grand tier so we can better match our guests' expectations. Sheraton Grand showcases our best properties as prime examples of quality design and service. We think it will also create a halo effect for the brand as a whole by showcasing these premier hotels and differentiating them as being Sheraton's best examples of the brand. The new Sheraton Grand tier also acknowledges our owners. Many of them have made significant investments in renovating classic Sheraton hotels, restoring historic properties, and, in some cases, building new iconic Sheraton hotels. They have raised the bar within the Sheraton portfolio, and we are recognising them by designating their properties to be part of the Sheraton Grand tier.
 

To ensure consistency and high-end experience to meet guests' expectations, we have created a set of global criteria to evaluate each and every Sheraton property. This criteria considers all aspects of a hotel, both inside and out, and our team is meticulous in its evaluation process. We also examine the hotel's guest experience overall, and whether guests enjoy a premium stay from check-in to check-out.

Starwood Hotels has several brands in its portfolio like Westin, FourPoints by Sheraton, Le Meridien, among others. How does the company differentiate the various brands? How do you keep the identities of these brands distinct?

Our aim is to build brands with distinct personalities, each catering to a certain kind of guest. We are laser-focused on invigorating each of our brands to drive both guest engagement and growth. Spanning luxury to upper upscale and select service, each of our hotel brands have their own programmes, marketing initiatives, amenities and services that differentiate what they stand for and who their audience is. For example, Westin continues to roll out innovative wellness offerings across fitness, nutrition and more, that allow guests to leave feeling better than when they arrived, while W Hotels and Resorts is constantly finding different opportunities to give its guests insider access into what's new in music, fashion and design.

What are the strategies to survive in a price conscious market like India?

A strategic and dynamic pricing strategy is key to our industry. It is important to understand the hotel's target customer, how they book and historical demand patterns. With our strong global systems, we are able to ask the right questions to make accurate forecasts and sound pricing decisions, which significantly impact hotel revenue and profit.

Our brands are only as strong as the associates who bring them to life every day both on and off property. We have a clear and concise strategy around talent that is an integral part of our work culture. Our holistic and integrated talent management and development system, Starwood Careers, is designed to grow and develop our associates across all levels. Additionally, we encourage our associates to travel and work across different regions, which helps set us apart from others in the industry.

How do you leverage technology to improve customer experience?

Our loyalty programme continues to be a key driver in Starwood's success. One out of every two guests at our hotels is an SPG member, making this a vital audience for us to cater to. Our leadership in the loyalty space has not only been driven by innovation, but also by our various partnerships that offer guests access to exclusive benefits, allowing us to engage with them on a more personal level. Technology has changed global travel, from how travellers search, select and book hotels, to the experiences they expect and look for when they are on property. We are constantly evolving our SPG mobile app to create a seamless experience for our members. And with 70 per cent of SPG Elite members using the app for transactions, we see this as a great area of opportunity.

Please explain how Starwood leverages analytics for pricing inventory and revenue optimisation.

Our aim is right price, right guest and right brand. Through years of research, backed up by significant investment, we have developed an advanced, cloud-based revenue management system called ROS (revenue optimisation system). One of its key highlights is its ability to detect deviations in competitive pricing and market sensitivity; applying analytics to make sound recommendations to the hotel. Using this powerful, innovative tool, hotels can adjust rates multiple times in a day and for future dates, as they now have the ability to use big data to optimise performance and also forecast more accurately.