LAS VEGAS—Choice Hotels International, Inc. opened its 62nd annual convention here at Mandalay Bay with a lot of optimism and a focus on the future.
“One of the reasons why we feel so optimistic is because the environment is finally enabling our progress,” said Steve Joyce, president and CEO. “The current lodging cycle is still in a sweet spot, and this is one of the longest and most positive lodging cycles on record.” Joyce pointed to several consumer trends that are positive: household debt is lower, home values are increasing, Millennials are finding meaningful work, and it’s expected that wages will go up, unemployment will go down and consumer confidence will continue to rise. “Those trends mean more opportunities for travel,” Joyce said.
The executive also commented on several industry happenings and how they will affect Choice. “Marriott’s acquisition of Starwood was the most significant and most surprising industry announcement of 2015. Marriott will be distracted for the next two to three years figuring everything out,” he said. “And the whole time, we’ll be focused on you.”
Switching gears to the sharing economy, Joyce noted that hoteliers could benefit by embracing vacation rentals. “We’re offering our powerful distribution platform to a select number of vacation rental management companies. And we are introducing them to Choice Privileges—the first rewards program in the vacation rentals industry,” he claimed.
That wasn’t the only loyalty program change announced. Beginning later this summer, Choice Privileges members will have access to a new members-only hotel rate on ChoiceHotels.com and the company’s mobile app.
Pat Pacious, EVP and COO, noted that five years ago, the Choice Privileges program grew at a rate of one million members a year. “With the launch of the new Choice Privileges program earlier this year, we captured one million new members in the first 100 days,” he said. “And we’re on pace to add over four million by the end of the year.”
Joyce noted that 2015 was a record year for revenue, with CRS sales up 13% and more than 53% of revenue delivered to hotels via Choice channels. Pacious added that last year Choice’s ADR was up nearly 4% and RevPAR rose more than 6%.
According to David Pepper, SVP and chief development officer, “With the lodging cycle nearing its peak, financing for new construction and acquisitions continues to be very strong.” Joyce added that, from an international perspective, Choice sees “tremendous opportunity in Europe” and is “currently evaluating several deals” in Cuba.
—Nicole Carlino