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... airlines. This rapidly changing industry forces operators to keep track of the merger and acquisition game. One never knows when the person in charge of operating the company is going to change. The vast majority of space dedicated to this area of management involved the description of financial transactions and strategies of hospitality companies. Comments on credit ratings, dividend announcements, public stock offerings, stock splits, credit line increases and loan petitions abounded.
Although these issues can be seen more as facts of life in management than as trends, they do highlight the increasing complexity of financing a hospitality operation and the wide variety of financing resources available to every operation. Hospitality managers must keep track of the financial activities of the industry in order to use the appropriate financing tools when the times demand it. The final group of postings was composed of press releases of companies reporting their operating results, primarily from the first quarter of 1997. An analysis of these articles resulted in the identification of two main trends. First, hospitality companies overall are performing quite acceptably.
Secondly, big hospitality corporations tend to perform a lot better than independent, small companies. The excellent performances of Circus Circus Enterprises, Marriott International, and Choice Hotels International contrasts with the somewhat poor results of small hotel and gaming companies such as Sands Regent and U. S. Franchise Systems.
The performance of several casinos in particular seemed not to keep pace with the overall good results in the industry. It must be noted that due to the short period analyzed, seasonal considerations may have played an important role in the performance of these companies. Nevertheless, scanning the financial performance of competitors can help the hospitality manager assess the value and merit of the results obtained in a particular operation. According to Figure 2, topics in the area of marketing covered almost 20 % of Hotel Online space dedicated to the specific environment.
The major issues surfacing in this management area include an increase in the use of the internet for marketing purposes, a proliferation of special promotions and advertising from hospitality companies, and an increase in the importance of state tourism organizations and tourism promotion associations in marketing destinations as a package. Many hospitality companies are realizing the marketing potential provided by the internet. From on-line reservation systems geared to the end consumer, to the development of web pages describing the services and facilities offered, hospitality marketers are jumping into the information superhighway to increase sales and product awareness. Web-developing companies are taking advantage of this trend to offer their services to hospitality companies, which can place adds at different web pages or collect reservations online. In addition, companies such as Radisson Hotels are offering special features on their home pages to attract more customers, such as online games and other interactive activities. The potential use of the internet in marketing hospitality products is amazing, and it can be guaranteed that more and more companies will employ it in the future.
The abundance of special promotions and heavy advertising is still a trend in the hospitality industry. The larger amount of postings described original promotions offered by different companies with the purpose of attracting more customers. The most popular promotions always appear to involve frequent flyer miles or frequent guest points. Also, most of this promotions involve joint efforts between different companies (i. e.
a car rental company offering more miles to customers flying in a specific airline). This emphasis on promotions seems to be an attempt to differentiate the services provided by very similar companies. It is getting harder to offer a completely original product to the potential guest, and these promotions may allow companies to be more appealing to certain customers. However, a big problem with promotions is that they are easily imitated by competitors. An example is a recent promotion started by American Airlines, offering half-price rates for babies two and under if the parents owned approved safety seats. On the same day, every other U.
S. airline except User had matched the promotion. Hospitality operators must assess the potential for success of every promotion before implementation. With respect to advertising, there appears to be an increasing tendency to use specialized advertising agencies to support corporate marketing efforts and deliver a more effective message. Due to their larger resources, big hospitality trademarks such as Caesar's Hotels, Planet Hollywood and KFC have taken advantage of this situation to deliver better ads and build brand loyalty. A final marketing aspect worth mentioning is the active role that state tourism organizations and other associations are taking to promote destinations.
Joint efforts by hospitality and tourism firms in specific destinations are proving to be successful in increasing the size of the pie for everyone to share. In the case of some cities and states, the efforts of these organizations are essential for the good performance of the tourism industry. Hospitality and travel managers will probably continue to cooperate with this joint marketing endeavors to improve sales and financial performance at the firm specific level. As it can be seen in Figure 2, R&D continues to be the most neglected area in the hospitality industry.
However, there appears to be a greater appreciation of the need to conduct market and customer research, and test new services and products before launching them into the market. The role of tourism organizations appears to be basic in this area of management, representing close to 50 % of the research efforts found in Hotel Online. The major efforts in this area have been directed to the determination of customer preferences and attitudes through surveys, the evaluation of economic impact of tourism activities on specific destinations and the test of new products and services by hospitality companies. From this efforts, companies have discovered changes in attitudes from their repeat customers, many cities have discovered the great economic effects of tourism for their communities, and companies such as McDonald's have tested the implementation of new technologies to improve their service. The importance of R&D in this industry resides in the fact that it can be the means for a company to obtain a competitive advantage and differentiate its product in the marketplace. This was the functional area of management covered more extensively by this online news service.
The major trends that were determined under this category are the expansion of operations of several hospitality and travel companies, and the streamlining of operations by the use of new computerized systems and the improvement of facilities, menus and services. The vast majority of articles related to this category addressed the issue of companies expanding their operations in a variety of ways. Airlines, for instance, appear to be constantly extending their operations to serve new destinations and diversify their geographical position. Management companies continue to acquire contracts with a variety of properties, franchises continue to expand, and international chains continue to open new properties in a variety of geographical locations. An important factor in this trend is the increasing efforts to expand internationally. Around 20 % of new operations by local chains described in Hotel Online were located outside the U.
S. An example is the incursion of Ritz-Carlton in China, positioning itself as one of the first international luxury chains to enter this market. The scanning of these expansion activities in the industry allows the hospitality operator to keep track of competitive threats and opportunities for expansion in untapped markets. The use of new technologies continues to be a major trend in the operation of hospitality and travel related companies. Many companies keep their property management systems up-to-date with the latest technologies, realizing the improvements on efficiency that this products bring. The introduction of high-tech services and features for guests and customers is also a noticeable tendency.
An example is the adoption of video-on-demand options in in-room TV systems by some lodging companies on an experimental basis. A final consideration regarding operations is the fact that results from in-house surveys are being considered more frequently to improve operations. Most menu improvements come from direct customer research, and result in economic benefits to food service providers. Operators must continue to pay close attention to the preferences of their repeat customers in order to increase loyalty or improve the quality of the service provided. Administrative topics occupied about 16 % of the specific environment space of Hotel Online. The major trends identified in the analysis of this category are the increase in the number of strategic alliances and joint ventures among companies, a continuing involvement of hospitality and travel firms in legal cases and a more open discussion of internal management practices as a good public relations tool.
The popularity of strategic alliances and joint ventures among travel and tourism companies is easy to identify. One study found that the main driving factors behind such alliances are the increasing globalization of the industry, heavy competition and the low profitability of some operations. These alliances vary in purpose, but they are usually intended to improve marketing potential through cooperation, or to maximize management capacity by joining forces with more knowledgeable operators. Recent examples are the management alliances of Sheraton with Floor and Equity Inns with Interstate hotels. A curious marketing alliance discovered through this research project is the joint marketing efforts of Las Vegas, Phoenix and San Diego to sell packaged tours including visits to the three cities in the same trip.
This alliance signals the incursion of local tourism organizations into the world of corporate cooperation. Hospitality managers at any level should be aware of the potential benefits of strategic alliances to be able to take advantage of them if the circumstances recommend it, and also monitor the moves of competitors to recognize situation in which a particular operation might be threatened. Another long-lasting trend the hospitality industry has experienced over the last years is its continuous involvement in legal and regulatory cases. The outlook for 1997 so far does not promise any changes. Although must cases involve routine legal matters such as obtaining construction permits and gaming licenses, others involve civil suits and legal proceedings that can have a profound effect on any company. A majority of these cases involve suits and complaints placed by customers, while the rest involve legal fights between companies on the grounds of unfair competition or unfulfilled contracts.
The majority of administration related postings depicted management practices, conflicts and changes experienced by some companies. Although no trend can be identified in these articles, hospitality operators may learn form the mistakes and successes of other companies. In addition, the reporting of new administrative strategies may give companies an opportunity to create favorable publicity in the marketplace. An example is an announcement by McDonald's describing new strategies that will push decision-making down to the customer level. Since this company has been under examination lately, spreading the word about the new strategy may result in a more positive attitude towards the company. This functional area of management was a bit neglected in the Hotel Online news service.
The major trends identified were a continuing involvement of travel and hospitality firms in labor related litigation and other labor conflicts, a strong competition among firms for top-management talent and the implementation of innovative employee support programs. Labor conflict issues include suits placed by employees against companies practicing biased or unfair hiring policies and strikes undertaken by airline employees. This does not seem to be a new trend in the industry; rather, it is a constant reality that operators have to face. Fortunately, the reduced number of cases noticed by the general media indicates that most companies are making a good job of managing their employee relations. The vast majority of HR related postings were hiring and promotion announcements by different hospitality companies. An important consideration in this area is the fact that employee exchange occurs almost always within the hospitality industry, which highlights the magnitude of competition among different companies for the skills and capabilities of top-level managers.
Finally, a trend sustained primarily by large hospitality corporations is the implementation of superior employee support programs in the industry. Companies are not just aiming to comply with labor regulations. They are going further to secure the well-being of their employees and achieve employee loyalty to the company. Good examples are Marriott's Welfare-to-work and Foundation for people with disabilities programs that appeared in Hotel Online postings. Hospitality companies must continue to provide this type of programs in order to reduce turnover and improve customer service. This study has attempted to determine major trends in the hospitality industry as described in the internet service of Hotel Online.
It also has attempted to determine the usefulness of internet news services such as Hotel Online for hospitality operators undertaking environmental scanning efforts. Some limitations of this research endeavor have to be acknowledged. First, the postings analyzed were reduced to a 60 day period, which undermines the coverage of all trends and neglects the cyclical nature of this industry. Second, the study was limited to the Hospitality News section of Hotel Online. Further research and analysis of the Ideas and Trends section of the service may give more support to the usefulness of this In conclusion, it can be determined that only some of the trends currently experienced were identified in this project. Their discussion can certainly provide the hospitality operator with a good overall picture of the industry's environment.
Moreover, a good argument in support of online means of information can be derived at after analyzing this particular project. Hotel Online appears to be an excellent provider of information for the many managers involved in travel and hospitality operations. Nevertheless, this study determined that the news provided are extremely industry specific, and users must realize that their environmental scanning efforts have to be complimented with more general publications, such as business magazines, newspapers and other journals. Since most of these publications are already available online, an excellent environmental scanning program may be implemented by simply adding bookmarks to a web browser.
Chon, K. ; Damonte, T. (1997). Environmental factors affecting the tourism industry as determined by content analysis. Visions in Leisure and Business, Vol. 10, No. 2, pp. 70 - 85. Chon, K. ; Olsen, M. (1997).
An analysis of the trends in the hospitality industry through content analysis of industry publications. Conference Proceedings, Clemson University. Chon, K. ; Singh, A. (1993). Current economic issues facing the U.
S. lodging industry. International Journal of Contemporary Hospitality Management, Vol. 5, No. 3, pp. 3 - 9. Clow, K. ; Garretson, J. ; O'Bryan, D. (1995).
Situational influences on the choice criteria for hotels by leisure travelers. Journal of Hospitality & Leisure Marketing, Vol. 3, Iss. 3, pp. 5 - 19. Dev, C. ; Klein, S. (1993). Strategic alliances in the hotel industry. Cornell Hotel and Restaurant Administration Quarterly, Vol. 34, Iss. 1, pp. 42 - 45.
Emenheiser, D. ; Tas, R. ; West, B. (1996). What do mature travelers perceive as important hotel / motel customer services? Hospitality Research Journal, Vol. 20, No. 2, pp. 77 - 93. Smith, R. (1995). Can lodging performance signal economic cycles? . Lodging, Vol. 20, Iss. 7, p. 31.
Bibliography: Chon, K. ; Damonte, T. (1997). Environmental factors affecting the tourism industry as determined by content analysis. Visions in Leisure and Business, Vol. 10, No. 2, pp. 70 - 85. Chon, K. ; Olsen, M. (1997). An analysis of the trends in the hospitality industry through content analysis of industry publications. Conference Proceedings, Clemson University.
Chon, K. ; Singh, A. (1993). Current economic issues facing the U. S. lodging industry. International Journal of Contemporary Hospitality Management, Vol. 5, No. 3, pp. 3 - 9. Clow, K. ; Garretson, J. ; O'Bryan, D. (1995).
Situational influences on the choice criteria for hotels by leisure travelers. Journal of Hospitality & Leisure Marketing, Vol. 3, Iss. 3, pp. 5 - 19. Dev, C. ; Klein, S. (1993). Strategic alliances in the hotel industry.
Cornell Hotel and Restaurant Administration Quarterly, Vol. 34, Iss. 1, pp. 42 - 45. Emenheiser, D. ; Tas, R. ; West, B. (1996). What do mature travelers perceive as important hotel / motel customer services? Hospitality Research Journal, Vol. 20, No. 2, pp. 77 - 93. Smith, R. (1995). Can lodging performance signal economic cycles? .
Lodging, Vol. 20, Iss. 7, p. 31.
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