The hotel chain hopes to draw more Hawaii bookings by focusing on recent renovations
POSTED: 1:30 a.m. HST, Jan 26, 2011
LAST UPDATED: 1:56 a.m. HST, Jan 26, 2011
It's a positive sign for Hawaii's economy that Starwood Hotels & Resorts, the state's largest hotel chain in Waikiki, thinks it could return to peak performance with a little help from its West Coast group sellers.
The chain brought about 800 of its top in-house sellers to Hawaii last week for its annual West Coast Sales and Operations Kick-Off meeting. "Reach the Peak 2011" is expected to draw more hotel bookings to Hawaii by spotlighting the completion of some $300 million in Starwood property renovations and educating sellers about Hawaii's appeal as a group destination.
"What a difference a year makes," Christie Hicks, Starwood's senior vice president of global sales, said as she kicked off the high-adrenaline, three-day event, which more closely resembled a rock festival than a business meeting. Dancers and singers performed MC Hammer tunes rewritten for Starwood as some attendees made cell phone videos and others tossed a beach ball high overhead.
In 2010 the chain focused on owning the upswing, Hicks said. Sellers, mostly managers from Starwood's West Coast properties, were told to concentrate on the changing market, drive the brand's top line, find new customers and gain revenue share, she said. In 2010, Starwood sellers made 24,000 sales calls and generated $35 million in new revenue and $73 million in new business.
"This recovery has started and we're coming back," Hicks said.
Starwood is counting on these sellers to continue bolstering Hawaii demand, said Keith Vieira, senior vice president and director of operations for Starwood Hotels and Resorts in Hawaii and French Polynesia.
"They'll go back to their customers and spread the word that Hawaii is a great place for leisure and group business," Vieira said.
Hawaii, with its newly renovated Sheraton Waikiki Beach and Royal Hawaiian Hotel, is positioned to lead the chain's success, said John Peyton, senior vice president of operations for Starwood North America.
"Hawaii is at the top of the list for reinvestment among destinations in the brand," Peyton said.
After seeing what Hawaii has to offer, there's no doubt that the destination will get lots of referrals through Team Hot, Starwood's referral program, said David Richard, director of sales and marketing for the Phoenician in Scottsdale, Ariz.
Waikiki was much improved from his last visit in 2000, Richard said. "It's really cleaned up. The renovations were amazing. Now when my sales team says, 'What hotels do you recommend?' my salespeople will be able to talk about the destination more. It will generate lots of bookings."
Lisa Morrill, director of sales and marketing for the Sheraton Keauhou Bay Resort & Spa, said the event already has generated leads for her Big Island resort.
"I got an e-mail on Saturday after everyone had left," she said. "My colleague in Denver recommended a potential customer."
Morrill expects more to follow.
Such optimism from one of the state's largest hotel chains and its major Waikiki player is good news for the state as a whole, said Joseph Toy, president and chief executive officer of hotel consultancy Hospitality Advisors LLC.
"It's one of the signals that we've been waiting for since Hawaii hoteliers had to begin the cycle of substantial room discounting in 2009," Toy said.
Recovery typically begins in the on-beach and luxury markets and then spreads to other hotel categories, he said. "Starwood has been doing phenomenally well in room demand because they have three of the state's top on-beach properties in Waikiki and they are newly renovated. Consumers see it as a huge value when they can find attractive rates at renovated properties."
The challenge for Starwood and other recovering hotels will be translating demand into room rate increases, he said.
"Occupancy will have to firm up to about 75 to 78 percent consistently to drive prices," Toy said.
While some Starwood-run hotels in Waikiki are already netting high occupancies, most hoteliers will be waiting until 2013 for performance to match 2007, the recent peak, and it could be 2015 before it outpaces costs, he said.