How generational changes are affecting hotels

SYDNEY — When Ron Pohl joined BWH Hotels in 2007, the company had one brand. Now, it has 18. But he said that isn’t the biggest difference in working for the company.

“What is different is the generational changes that we’re now experiencing,” said Pohl, president of the soft brand WorldHotels and president of international operations for Phoenix-based BWH Hotels. “For the first 30 years of my career, every guest was a baby boomer, and now we have baby boomers, millennials, Gen X, Y, Z, and their expectations and use of technology is completely different.”

Pohl was interviewed by Jeff Higley, president of The BHN Group, on Day 2 of the HICAP Australia, New Zealand (HICAP ANZ) conference in Sydney last week. He noted the difference in how he uses technology versus his children and talked about how those generational changes affect the hotel industry.

“We’re transitioning from one generation to the next. Millennials are the largest purchaser of luxury travel today, and the Gen X, Y and Z are going to be the wealthiest generation, probably because of what they’ve inherited,” he said. “They will be spending differently than what either of the other generations have. Over the next five to 10 years, it will be an evolution of how we continue to meet the guest expectations.”

We are using WorldHotels as that opportunity to move Best Western brands up and reposition the entire organization at that upscale level… The key markets for us are all the regions of the world, but primarily in North America, because we’ve only have about 30 properties there.

Ron Pohl

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Pohl went on to speak about a number of subjects with Higley, which are summarized below.

Hotel Investment Today (HIT): Can you talk about the evolution of WorldHotels since BWH acquired the company in 2019?

Ron Pohl: WorldHotels has been around for over 50 years. It started in Europe as a luxury hotel soft brand 50 years ago. I had never heard of it until we bought it in 2019, and I’ve been in the industry for 40 years… We purchased WorldHotels because it was an opportunity for us to leverage and move the entire organization up into the upscale segment. We are using WorldHotels as that opportunity to move Best Western brands up and reposition the entire organization at that upscale level… The key markets for us are all the regions of the world, but primarily in North America, because we’ve only have about 30 properties there. (Pohl also noted that while the majority of hotels are soft branded, a few wanted to be a hard brand as well — three in China and two in Latin America so far.)

HIT: Besides being president of WorldHotels, you are also president of international operations for BWH Hotels. How do those jobs interact with each other?

Pohl: They play off each other… It really gives our development team the opportunity to have meaningful conversations with whatever investor or asset someone might have, and my job is to balance that…  [BWH] has 1,000 less hotels internationally than what we have in North America. The population of North America is 340 million people, and there are 8 billion people around the rest of the world. So, I believe our opportunity for growth going forward will be international.

HIT: What will be role of artificial intelligence be for BWH and the hotel industry going forward?

Pohl: Across the industry, we’re all still trying to figure out the AI component and where to leverage that to benefit hotel operations and make them more efficient. We also support the face-to-face service we provide. We have to be more efficient. We see that rates and occupancy, for the most part, are still growing. The revenues are still growing, but the problem is the expenses are growing at a faster pace and have continued to and will continue for the foreseeable future… Whether it’s the cost of labor, utilities, or food cost, everything is going up. So, it’s a delicate balance there.

HIT: What are your conversations with owners like today?

Pohl: Typically, every conversation is specific to that owner and that hotel, and that’s a successful organization’s approach. I spent my first 25 years as a franchisee and then the last 20 as a franchisor. I get that balance, and our team understands that balance of the first conversation we have is, ‘What are your expectations? What do you want from us? And can we provide that in a meaningful way and drive success?’… We continue on that path. But we’re also honest in saying, ‘You know what? I don’t know if I can do that for you.’ I don’t want to get into a bad marriage from the start. So it’s a balance of how we meet those expectations, and we need to have that discussion before we ever go down the road of moving into a long-term agreement.