The Modern Hotelier #161: Merger, Resort Fees, Running Vacations and More | with Josiah Mackenzie
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Steve Carran: Welcome to another episode of The Modern Hotelier Hospitality Hot Topics. This month we are joined by Josiah Mackenzie, the head of marketing at Actabl, and we're gonna share what happened this month in May in hospitality. Thanks for joining us, Josiah. How you doing today?
Josiah Mackenzie: It's doing great. Great to see you guys. Thanks for having me on.
Steve Carran: Absolutely. It's good to have you back. So, To kick it off, we're gonna talk about something I feel like we talk about on a monthly basis. We had a merger and an acquisition happened in the past month. Marriott bought Citizen M and Springboard merged with hotel equities. Josiah, what's your thought on this?
Josiah Mackenzie: These are big, exciting developments. Uh, in, in my view, I think it's good news. I think it's good news for everybody involved. Um, it can be, there's, there's considerations in these sort of, Actions that, um, the different participants need to be aware of. I. Talking about citizenM and, and, uh, and, and Marriott, citizenM is one of the most innovative brands, has been for many years.
I think many in the industry, myself included, have looked to them as, people who are at the forefront of where hospitality is, where it can go. years ago they brought a concept onto the scene that. Brought innovation from construction from the way the brand was positioned and communicated to the way guests were able to experience their properties.
To the service and the way that people worked at these properties. So they brought innovation across the board. They've stayed at the forefront of innovation. That's why so many people love citizenM. I think it was a really smart move by Marriott to bring them into the Marriott portfolio. citizenM, CEO Leonard, uh, had posted on LinkedIn why they did this.
There's a couple, sort of macro factors at play. One of the biggest ones being a change in the distribution landscape. It got a lot more expensive. To acquire bookings, to acquire revenue over the years that the company has been active as part of the Marriott family now, they'll have many more distribution options.
I think what all of our listeners can take away from looking at this are, are kind of two big things in my mind. One is the way that you build a brand and communicate it, matters a lot. if I have to kind of think of it very simply, citizen's cool, right? They're cool on a lot of different levels, and that vibe is cool.
Many people, including myself, have enjoyed. Behind the scenes also, they were very innovative and just very, very smart operators in using technology. Their operating processes were really ahead of the game. And so through this acquisition, Marriott is able to get access, you know, to all of those, you know, kind of that way of operating.
And so I think this just accelerates the trend that we'll see in hospitality of really cool guest experience combined with back of House Smart. Tech enabled operation. So my kind of overall thought with that is, is it's exciting. I think with Springboard and hotel equities, this is exciting too.
I, I think again, scale is, scale is so important. You're able to do more, at scale. And so these are two phenomenal organizations. I know they're leaders, uh, well and excited to see that what they're gonna do in, in the months ahead.
David Millili: So I think what's cool is that what's starting to happen now, and I'm not gonna name the brand, but a lot of these acquisitions, the, the larger brand is realizing that they need to keep some sort of separate identity and kind of let these brands breathe and live on their own.
And, you know, that they've got, you know, loyalty programs and guests who are used to things being a certain way. So they wanna leverage exactly what you said, Josiah leverage all that distribution, but they're still trying to make sure they keep some sort of. Independence in there and keep that, that look and feel, uh, for their, you know, their past guests.
So also Airbnb has relaunched, experiences. if you wanna find another opinion, you can go check out Max Stark's LinkedIn page. He had a big rant there. Uh, and they're adding hotel style services. So I think there are certain things why you go to an Airbnb versus what you really want at a hotel.
But Steve, what are, what are your thoughts?
Steve Carran: I mean, I love this, to be honest with you. I, I think it's really cool. We talk about how important experiences are. For, you know, travelers these days and Airbnb is leaning into this. Once again, I, they tried this before, I feel like a few years ago it didn't go so well. but there's a few differences this year that I think is gonna make them successful.
You know, they're focusing on these experiences. You can have private chefs come to your Airbnb to do things, you know, kind of like that hotel feel. You can go to a Michelin star restaurant and get a chef there, not a private. It's private, but still, still really awesome for Airbnb. and then they have these Airbnb originals, which, you know, for a sports fan you can hang out with Patrick Mahomes.
I have a barbecue with him on a Sunday. That just sounds awesome. You can also, go behind the scenes. Uh, Sabrina Carpenter as well. So I think they're really leaning into experiences and, you know, if you have the budget to, uh, take advantage of some of these experiences, I think they're, they're once in a lifetime.
Josiah, what do you think?
Josiah Mackenzie: The market here is huge. I think the, the global, activities markets estimated around a trillion dollars a year. huge amount of market there. as you mentioned, Airbnb has tried this in the past. They're serious about this now, investing hundreds of millions of dollars in in this. I think what you just shared, Steve, is really important for all of our listeners to keep in mind.
Of course, you want your guest experience for every guest day to day to be of equality, that they're gonna come back, they're gonna tell their friends. You also gotta do something a little special, right? Have that menu of kind of fun offerings. I feel like the menu has gotten really extensive here. The talent here that Airbnb is bringing into this program.
I think an average 10 year of, of 10 plus years, kind of doing these things. This is not, you know, amateur hour here. This, they're bringing in some real high level talent. but I think there's also sort of this cultural resonance that they're creating as well. Whether it's working with athletes or they're just putting together with musicians, things that, kind of capture the imagination.
So they're, they're sort of positioning themselves in the market as the go-to for, if you want something really unique, really special, I think it's really important. Here's the thing though, I think this opportunity is not just limited to Airbnb. Hotels have an extraordinary opportunity here. I would say hotels are even better positioned to execute on this, right?
They have better facilities, they have better staff overall. There's an ability to invest at scale, so I encourage all the hospitality leaders that are listening to this to think about, what can this look like for you? And don't just invest in this. On the side, you see the hundreds of millions Airbnbs investing here.
You gotta invest big. If you want a big outcome like this.
Steve Carran: Absolutely. Well said, well said. So another big story that came out this month was Sabre sold their hospitality business for one. $1.1 billion. Josiah, you're on kind of the hospitality tech side now. what do you think about this?
Josiah Mackenzie: I think it says, uh, a lot about the state of hotel tech. You know, private equity investors are among the smartest in the world, and they see huge potential in hotel technology. They're, you know, spent more than a billion dollars to acquire this, this company on the hotel side. You know what I hear?
Uh, and I think this is gonna be, uh. Not shocking to anybody listening to this is that hotels want a one stop shop. You know, what they want is they're kind of tired of, having to make, uh, dozens of phone calls to get anything done. You know, they want one point of contact. I think, you know, there's an opportunity here.
and so I think, you know, we've seen in over the past months and years, uh, more consolidation and so I think there's, there's sort of a, you know, increased competition. I'm always thinking about this from the hotel perspective. You know, what do. You just need one way to see what's going on in your business, right?
With regards to, you know, across all the different aspects of your business. So, you know, at Actable that's what we're doing with profit Sword. Doesn't matter what technology we're using, we'll plug into it. We'll give you a sense of what's going on. But, uh, I think this really speaks to the significance and the big opportunity with hotel tech, wherever you are in the ecosystem.
David Millili: Yeah. We'll see how it goes. I mean, it's very interesting. There weren't a lot of choices, uh, on the CRS side and in that area. Now you've got, you know, travel click as part of Amadeus. It's gonna be really interesting to see how SRE or those of us who are old cannot help sync, uh, Synesis. How that evolves and how that, that changes the company that really, you know, they took off, they became really the largest in the world.
You know, they, they had everything that you were saying, Josiah, they had, they were doing websites. They got to a point where they weren't even, uh, they didn't wanna service clients that were less than $70,000 a year in a RR. They wanted them to go to a reseller. So this is interesting, and I think, you know, time will tell and, you know, maybe we'll, have to revisit some of these things in the hot topics, you know, in the, in the year ahead to see where things are at.
So, I am very happy about this because I. Do not like resort or facility fees. to me it's just a clever way of trying to get you to the checkout to then hit you with something. And I don't understand why we can't just charge the room or charge, like for me, resort fees. I can somewhat understand to an extent, but I think what's happened is everyone's taken advantage of it.
In, in a city like New York, they now have facility fees. And you know, you're like, what is that facility fee? I get some water, I get wifi, I get to use the gym, all stuff. That's pretty ridiculous. so I'm happy that now they're gonna have to be disclosed upfront. What are your thoughts? Just say,
Josiah Mackenzie: Yeah, I mean, I remember when, resort fees were, kind of first being rolled out. in New York and revenue managers thought they were, you know, so clever to charge these extra and just kind of juice their, their revenue. Uh, uh, it was, it was a huge mistake in, my view, and, I've worked in revenue management for years.
It's a huge mistake because fundamentally it's, uh, it, it's not kind of pro customer. it's not for the guest, right? It's, trying to, kind of pull a, pull fast one. And, and so I couldn't be, more excited to, uh, see more transparency in the world of hospitality.
Steve Carran: I'm with you. Give me all the transparency. It's happened to me too many times where I've got to the booking section of the, of the website and all of a sudden there's this resort fee and I'm like. I'm just not gonna stay there and I go find another hotel. So more transparency the better. This is a great first step where we get to see all the fees.
I also saw one thing which I loved, is they have to disclose premium amenities such as, uh, wifi. So those wifi charges you have to see upfront along with gym access. So if they do charge for the gym, they're gonna have to show that upfront too. I'm just excited to see kind of what I'm gonna be paying. but I think the next step is to get rid of these.
So, at Josiah, I'm excited for your, for your take or your opinion on this next one. Running vacations are the newest trend. People are booking vacations, where they have great scenery as they go on runs. I know you're a runner. two part question. I'm gonna get you get your, get your thoughts on this running vacation first, and then I'm gonna get your thoughts on something else after this.
Are you gonna book a vacation to run?
Josiah Mackenzie: I, I love, I love seeing more of this. I think this has always been true, just. Some extent, I think Marathon, I've run a number of marathons and fly to different cities. It's honestly a great way to experience the city when you're running around. and, uh, you know, I, I ran La Philadelphia, Barcelona, and you kind of go there and you, you know, you're running, you know, a lot of miles, through those cities.
So I think that's great. I think over in recent years, we've seen a rise in, experiential travel. I think, you know, this is one of the simplest, most pure forms of, of experience. You know, you're just on your, your two feet running around, a lot of opportunity here. I think sometimes when we think about experience and hospitality, there's big budgets.
You gotta invest a lot. I think, could kind of be very creative. and I'll give you kind of two, two quick examples On a very small scale, there's a, a, a group called Annex Hotel in Canada. They partnered with a local run club called Slow Pokes. And, uh, that run club already existed. a great, great story, but already existed, created great community relationships, all the things that we talk about in hospitality, right?
Like embedding in community, create experience, a win for everybody. Westin at a bigger scale has kind of rolled out a, I think 150 some hotels, a program with, maps, gear you can rent, things like that. So there's ways to get involved. If you kind of look at kind of running in general right now, adventure travel's about $800 million.
Uh, industry. By 2032 that's expected to double, to over a trillion dollars spent on adventure travel. So a lot of money's being spent here. If you look at the demographics, a lot of people with money are, are kind of doing these sort of trips. And then if you look into the future, uh, three outta four Gen Z, travelers want more, outdoor, uh, you know, exercise-based, uh, travel as part of the mix, right?
So there's kind of opportunity here across the board. I would encourage our listeners to think about how can you just start. Getting creative, maybe, maybe a partnership, a little program. You maybe don't have to invest a ton of money. And then if you're responsible for a bigger collection, you know, maybe kind of think about, investing a bit more money into it.
But I'm really excited to see this. I think this is you know, adventure, experiential, travel at its best.
Steve Carran: David, you gonna book a running vacation before I move back to Josiah?
David Millili: Yeah, mine's gonna be a, a run walk, crawl, and it's just gonna be going from bars to, and they're gonna get, they're gonna get shorter in distance as you, as you go. So, yeah, I, I, uh, I love Spartans and things like that, but I, I, I'm not just a, a pure runner unfortunately, but
Steve Carran: Maybe, we'll, maybe one day we'll try it. Maybe one day. So Josiah, I want to come back to you here. You have had some travel recently where you got to go to Istanbul, you got to go to Barcelona. in this recent travel, did you. See any new trends or anything that really stuck out to you while you were international?
Josiah Mackenzie: I'll give you a couple things that, top of mind for me. One was the power of music and shaping. You know, set a coffee shop. They put some Miles Davis on, on the record player, old school vinyl analog sound, felt so warm, really set the stage. Different restaurants, different hotels. I was just really reminded of the power of music, right?
And so if you're not kind of investing in this, this is really a huge part of the guest experience. Some of the thing about, um, I was also impressed, you know, we, we've talked a little bit earlier in this conversation about kind of chains and things like that. I think sometimes in hospitality we've over indexed on, uh, the one of one I've done that myself, you know?
I think I would encourage our listeners just to think about what is a good guest experience, what's a good customer experience? I, um, experienced honest greens, kind of a fast ca, fast casual concept in Barcelona. A really good, it was kind of a price point of, I don't know, 15, uh, or so dollars, but really good experience.
Experience. You go in there. Dark lighting plants all over the place, bumping soundtrack, incredible food. And I was like, yeah, it's a, it's a chain, it's a group, but the experience is phenomenal. So I think I was reminded at the end of the day, just make sure you serve your, your guests well. And then kind of a, a last thing was I was really impressed by the power of AI for, for travel.
And so, we talk a lot about ai. I think probably including myself, I'm sometimes tired of hearing about it, but just as a traveler out there, I used it a bit for travel planning. It was okay. It wasn't great. What was really interesting is immersing myself in the location and so getting a sense of the history, my neighborhood, what's gone on here, what is unfolding.
I learned more in three days in Barcelona than I did in six months living there previously. So right now I'm thinking a lot about, for you, maybe the marketing folks that are listening, you're probably creating a lot of content. Honestly, AI's probably gonna provide more personalized, relevant content, so maybe think a little bit less about generic content that you're publishing to try to serve your guests.
Think about what AI does not have access to, right? So that might be operational stuff, like is there availability at a cabana at the pool, or do I have some event going on? But I would really index as a hospitality leader into kind of what AI cannot answer, because I spend hours each day with ai and I was really blown away on this trip by kind of my personal, you know, traveler use of it.
And that's only gonna accelerate in years to come.
Steve Carran: A hundred percent. A hundred percent.
David Millili: So I was very fortunate. I was at the, actable Advisor, group conference in Fort Worth. So I got to learn a lot about what's going on with Actable. But Josiah, can you let those listening know what's kind of, what's happening with Actable and what's up and coming?
Josiah Mackenzie: Yeah, so I joined Actable a couple months ago to, uh, to lead marketing. And the reason I did it was I was hearing in so many of the conversations I had on my podcast, hospitality Daily, that people needed support in running their hospitality businesses, right? They wanted to take care of their teams. Wanna take care of their guests.
and in this environment is more challenging than ever. And specifically in driving profits, right? Profits gonna fuel everything that we love in hospitality. So Actable essentially has four key areas that it supports hotels in, gives them the power to profit. there's profits. Word gives business intelligence essentially view into what's going on in my business.
Regardless of what technologies we use, we plug into that, give you a sense of what's going on so you can make better decisions. we have hotel effectiveness, which helps with, labor management. The number one controllable cost for, for most hotels. transcendent helps you make sure that the infrastructure in your hotel is being maintained so nothing breaks down and disappoints your guests.
And then Alice, which is a concierge technology and service delivery platform, can text, you know, the front desk and get things taken. Uh. That's the kind of suite of ways that we're, we're helping folks and um, I think one of the areas that is really top of mind for me is labor management. I think to be very specific with this, I would go to a lot of investment conferences over the past, years and hear labor talked in, a sort of way that, that honestly just didn't feel right to me.
It was often in this context of. I, I kinda got the sense some of the presenters would, be happy if labor was just, a line item in some kind of a, financial report and that number eventually just went to zero, right? That's not what's gonna create a great hospitality business, right?
And so I'm really interested in digging in with our customers to understand, yes, costs are increasing here. We're not trying to squeeze those costs, we're just trying to match the needs of the business with kind of the people that you have, the staff that you have that's gonna take care of them. And so, we're kind of going through a lot of work when supporting our customers with hotel effectiveness in that regard.
So it's a lot of kind of matching, demand with, with, uh, that your staff. So, you know, you don't roll up to a hotel and there's one person at the front desk and you have that long line or vice versa, right? You kind of a quiet period and you're just. Have a lot of people standing around. So we we're seeing a lot of efficiency opportunity there.
you know, this is a very, very dynamic market right now, and so you have to control what you can control, and so you need visibility. That's where Profit Soar gives, our customers visibility into what's going on. You know, how do I make smart decisions? How do I get through this? Uh, so it's, it's been a, a really fun learning journey and, and excited to hopefully see a lot of folks at High Tech.
We high tech. if anyone's listening to this, come by our booth and we'd love to chat with you.
David Millili: So, Josiah, please let everyone know how they can get in touch with you or how they can learn more about Actable.
Josiah Mackenzie: Yeah, so find me on LinkedIn. Uh, you can email me josiah@actable.com. That's A-C-T-A-B l.com. Uh, or check us out, uh actable.com and would love to hear from you.
David Millili: That's great. Well, that. Is it for another episode of the Modern Hotelier Hospitality's Most Engaged podcast? This has been our hospitality hot topics for May. So whether you're watching or listening, we appreciate you and hope to see you again soon. Thank you, Josiah.
Josiah Mackenzie: Thanks