Skift Daily Travel Briefing

Episode NotesA recent report in the Wall Street Journal said Choice Hotels International is considering buying Wyndham Hotels & Resorts. However, hotel industry analysts are skeptical, reports Senior Hospitality Editor Sean O’Neill.O’Neill writes a Choice Hotels-Wyndham merger could create the largest hotel franchisor in the U.S. But he cites two analysts who explained why it’s unlikely to happen in a Truist Securities research report. Choice Hotels would have to add more budget properties to its portfolio, which might undermine its strategy of boosting its collection of high-end properties. In addition, a merger might face pushback from antitrust authorities. The two companies combined already have a more than 50 percent share of the U.S. economy hotel market. Still, O’Neill adds that a merger might make sense in some ways. He notes that bigger is better is a general rule in hotel marketing, franchising and management. Next, Short-Term Rental Reporter Srividya Kalyanaraman profiles a&o hostels, a Berlin-based company that has reused dirty, run down buildings as part of its quest for net zero carbon emissions.  A&o CEO Oliver Winter said the company, which aspires to be Europe’s “zero-emissions hostel chain” by 2025, scours cities for dirty, ugly buildings that can be repurposed into hostels. Kalyanaraman writes that’s a huge part of its net-zero goal since it allows the company to open a new property with a zero carbon footprint. Winter adds that a&o’s strategy is appealing to Gen Z consumers increasingly looking for greener travel. Winter also said that using refurbished buildings is substantially more economical for a&o considering the enormous costs it would face if it constructed new properties.Finally, the percentage of U.S. adults planning Memorial Day travel is set to jump from last year despite widespread concerns about inflation, reports Associate Editor Rashaad Jorden.A recent survey by travel news site The Vacationer found roughly 64 percent of American adults intend to travel during Memorial Day weekend, a nearly 5 percentage point jump from 2022. Eric Jones, co-founder of The Vacationer, said that increase indicates a strong summer for the travel industry. However, Jones acknowledged that inflation could make travel during the upcoming holiday weekend difficult for some people. About 66 percent of respondents in The Vacationer’s survey said inflation was affecting their Memorial Day travel plans. Jones added some people eager to travel will stay home because can’t they afford the surging prices.

Episode NotesThe travel industry has reached a significant milestone in its recovery from the pandemic. Skift Research’s Travel Health Index for April 2023 reveals the industry is performing better than it did prior to the pandemic.Research Analyst Saniya Zanpure reports the Index’s average global score in April hit 101 percent of pre-Covid levels, 2 percentage points higher than the previous month. Skift Research uses data from 22 partners to track the travel industry’s performance. Latin America, the Middle East and Africa are among the regions that have seen their travel industries make a complete recovery from the pandemic. However, Zanpure notes not all countries have fully recovered, citing Hong Kong and Russia as two destinations yet to hit even 80 percent of pre-Covid levels. Nine of the 22 countries Skift Research tracked haven’t surpassed 2019 levels as of April 2023. Next, Airbnb executives recently expressed concerns amid falling stock prices about a slowdown in bookings compared to 2022. But Short-Term Rental Reporter Srividya Kalyanaraman writes the company shouldn’t be worried about such a drop, with summer travel demand surging.Short-term rental data provider Key Data found the number of nights booked in the second quarter worldwide is up 16 percent from the same period last year. In addition, occupancy rates have risen nearly 16 percent globally. Kalyanaraman cites the United Kingdom and Europe as two destinations that have seen significant year-over-year increases in both average daily and occupancy rates in the second quarter.  Finally, Hilton Worldwide has become the latest hotel company to make a big move in the rapidly booming extended-stay sector. It announced on Tuesday it’s opening an extended-stay brand, reports Associate Editor Rashaad Jorden. Hilton CEO Christopher Nassetta expressed optimism that the yet-to-be named brand, assigned the working title Project H3, could efficiently serve the growing number of travelers seeking longer stays. Jorden notes Hilton joins a list of hotel giants unveiling extended-stay projects recently. Hyatt and Wyndham in particular have announced the names of new extended-stay brands during the last several months. 

Episode NotesSkift senior media producer Jose Marmolejos speaks with Skift executive editor Dennis Schaal about his latest article on Skift.com covering the 10 highest-paid online travel execs in 2022. They discuss who topped the list, how executive pay has trended in the last few years, and whether these large compensation packages are necessary to recruit top-notch talent.In other Skift news, Associate Editor Rashaad Jorden reports that hotels are increasingly developing locally themed experiences to appeal to travelers. Jorden writes hotels believe they can attract guests and boost revenue by featuring local art and food, with more travelers looking for destination-based experiences.  Next, a U.S. District Court judge recently ordered JetBlue Airways and American Airlines to end their Northeast Alliance, which enabled the two companies to sell tickets on each other’s flights. Edward Russell, editor of the Skift publication, Airline Weekly, delves into the implications of the judge’s decision, including what it means for JetBlue’s pending merger with Spirit Airlines. Finally, Columnist Colin Nagy looks into the rise of membership clubs, with New York and London, among other cities, welcoming a flood of new entrants. Nagy touches on some of the strategies new membership clubs are taking, including their plans to enhance their guests’ culinary experiences. 

Episode NotesHotel giants like Marriott, Hyatt, and Hilton have unveiled plans in recent weeks to open extended-stay brands. They’re betting the segment will continue to grow in popularity in years to come, reports Senior Hospitality Editor Sean O’Neill.Marriott CEO Anthony Capuano said in a recent earnings call that his company would be launching an extended-stay product in the near future. Hilton CEO Chris Nassetta said it would debut an extended-stay brand soon while Hyatt unveiled a new brand last month as part of its entry into the sector. So what’s driving the enormous interest in extended-stay brands? O’Neill cites the ongoing housing crisis in the U.S. as one factor, noting that home construction has failed to keep up with demand in many U.S. markets. He adds the resilience of blended leisure and business travel could boost extended-stay brands for years to come.  Next, the Soho House chain of membership clubs is eager for its members to increase spending. However, it’s not necessarily looking for more traffic in its properties, reports Senior Hospitality Editor O’Neill.O’Neill writes Soho House is focused on upselling members. It’s rolled out an updated menu of food and beverage times that it hopes is more locally relevant. CEO Andrew Carnie said its goal is to boost spending while not necessarily wanting more footfall in its properties. O’Neill adds the Soho House is looking to generate at least $1 billion in total revenue this year. Soho House total membership rose 38 percent in the first quarter from the same period last year. But it was in the red, posting a $16 million net loss during the first quarter. Finally, India is poised for a major aviation boom, with domestic bookings recently surpassing pre-pandemic levels, writes Asia Editor Peden Doma Bhutia, and Middle East and Asia Reporter Amrita Ghosh in Skift’s India Travel Daily newsletter.Travel technology provider Sabre attributes the surge in domestic traffic in part to the rise of low-cost carriers in the country. India’s low-cost carriers flew a little more than 26 million travelers in the first quarter of 2023. That’s a 14 percent jump from the same period in 2019. In addition, Indian authorities have pledged to make major improvements to the country’s aviation infrastructure. As India aims to open 70 more airports by 2025, the government has announced plans to invest $12 billion in infrastructure upgrades. Prominent Indian airlines, including Air India and Akasa Air, have also made large aircraft orders recently. 

Episode NotesGoogle Travel eliminated the feature that allowed Gmail users to view summaries of their past, present and future trips on google.com/travel, reports Executive Editor Dennis Schaal. A Google spokesperson said the tech giant decided to scrap the free feature in Google Travel because it didn’t attract enough users to justify the resources required to maintain or further develop it. However, the list of travelers’ past and future trips will still appear on Google calendar. Schaal writes that Google Travel will continue to focus on services such as flights, hotels and vacation rentals. Next, Booking.com’s latest Sustainable Travel Report reveals a large appetite among Indian travelers for greener ways to travel. Nearly three-quarters are seeking regenerative travel, which aims to leave destinations in a better condition than prior to a visit, reports Middle East and Asia Reporter Amrita Ghosh in Skift’s India Travel Daily newsletter.Booking.com found a greater percentage of Indian travelers are partaking in greener travel than they did last year. Fifty-five percent said they use their towels more than once, a 21 percentage point jump from 2022. In addition, 57 percent of Indian travelers brought their own reusable water bottles on trips, 12 percentage points higher than last year. Finally, Worldia, a booking platform for travel agents, recently raised a little more than $27 million, writes Travel Technology Reporter Justin Dawes in this week’s Travel Startup Funding roundup. The Paris-based company plans to use the funding to expand in Europe and North America as well as increase hiring and improving its tech platform. Dawes writes Worldia’s business-to-business tech platform enables travel agency websites to offer one-stop travel planning and booking services. The company said it has access to 16,000 hotels in more than 80 destinations. 

Episode NotesPeople who want knowledge about the travel industry on Wednesday got a valuable new resource to obtain critical information. Skift unveiled Ask Skift, an artificial intelligence chatbot that will answer your questions focused on the travel sector, says Skift founder and CEO Rafat Ali.Ali writes that a user can ask questions on Skift’s website such as “How is Airbnb planning to leverage AI?” or “Who is IHG’s CEO?” Ask Skift has been trained on the entirety of Skift archives over the last 11 years, including daily stories and research reports. The chatbot will also provide other specialized travel industry content and data in weeks to come. Ali said the emergence of generative AI is enabling Skift to have a question and answer-based relationship with readers that wasn’t feasible before. Next, JetBlue Airways believes it’s taken a big step to boosting revenue. The company has made major updates effective Wednesday to its already lucrative loyalty program, reports Edward Russell, editor of Airline Weekly, a Skift publication. JetBlue’s updated loyalty program includes new elite Mosaic tiers and perks, including free business class upgrades and free helicopter transfers between JFK Airport and Manhattan. Russell writes that the driving force behind JetBlue’s loyalty updates is the opportunity to earn more revenue. The New York-based carrier generated $100 million in loyalty-related revenue in the first quarter. That’s a 14 percent year-over-year increase. Finally, the Hawaii Tourism Authority is continuing to market the Aloha State despite not being allocated funding from the state legislature for the next two years. The agency is planning to award a huge contract to market Hawaii to the U.S. mainland, writes Global Tourism Reporter Dawit Habtemariam. Habtemariam reports Hawaii Tourism Authority executives decided at a recent board meeting to award a marketing contract worth up to $51 million. The organization also plans to move forward with a $34 million contract for destination management as well as a nearly $3 million contract to market the state to Canadian travelers. Habtemariam adds the contact winners will be selected on May 22. 

Episode NotesUber is gradually beefing up its travel portfolio. The company has entered into a partnership with online travel agency Hopper that provides its UK-based users the opportunity to book flights and buy fintech products, reports Executive Editor Dennis Schaal. Schaal notes that Uber is introducing the flight booking feature to a small percentage of its UK users in mid-May while planning a full rollout by this summer. In addition, several Hopper services, including the ability to cancel flights for any reasons or get refunds in the event of flight disruptions, will likely be available for Uber’s UK consumers. Next, despite rising prices, U.S. travelers largely aren’t eager to cut their travel budgets. Skift Research’s newly released U.S. Travel Tracker report reveals that many consumers are protecting travel from spending cuts they may be making because of inflation.The latest survey from Skift Research finds 70 percent of U.S. travelers had experienced higher travel prices while booking trips. However, only 5 percent of respondents said they would or had cut their travel spending. Senior Research Analyst Varsha Arora writes that although a growing number of Americans believe the country’s economy will worsen in the next year, more than half believe their personal financial status will improve in the next 12 months. Arora adds that nearly 60 percent of Americans traveled in March 2023, a 4 percentage point increase from last December. Finally, Choice Hotels has seen bookings surpass pre-Covid levels despite widespread pessimism about the U.S. economy. Why is the company enjoying so much success recently? Choice attributes the surge in bookings to the rise in blended business and leisure travel, reports Senior Hospitality Editor Sean O’Neill.CEO Patrick Pacious said during Choice Hotels’ first quarter earnings call on Tuesday that remote work is helping fuel its strong performance. O’Neill notes the company benefited from travelers extending their trips into shoulder days of the weekend more than they did pre-Covid. Choice Hotels saw a 2 percentage point jump in occupancy growth on Thursday and Sundays compared to 2019 levels. Choice Hotels generated a net income of nearly $53 million during the first quarter. 

Episode NotesFor today’s special episode, Skift senior media producer Jose Marmolejos is joined by Skift Global tourism reporter Dawit Habtemariam to talk about his article that was published on Skift about tourism boards and influencers. Now in other Skift News, Asia editor Peter Bhutto . Travel Marketplace Skyscanner found that eight of the world’s top ten trending destinations for travelers are located in Asia. Now in other Skift News, Asia editor Peden Bhutia, reports that Asia’s tourism industry has made an enormous recovery. Travel Marketplace Skyscanner found that eight of the world’s top ten trending destinations for travelers are located in Asia. Next, the number of women occupying leadership positions in the hospitality industry is continuing to rise. However, contributor Carly Thornell writes Women fighting to land executive roles at major hotel companies still face enormous challenges.Finally, Air France-KLM is looking to expand in South America, and the group believes acquiring Tap Air Portugal might be the way to go. Reports Edward Russell, editor of Airline Weekly, a skift publication. Although, Russell writes Air France KLM is just eyeing a deal with TAP for now. Air France KLM CEO Ben Smith notes Tap’s extensive service to Brazil is very attractive to his company.

Episode NotesSocial media influencers have become more powerful in marketing in recent years, with a growing number of companies looking to tap into their sometimes-enormous reach. That list includes destination marketing organizations, or tourism boards, that are developing more sophisticated marketing strategies for influencers as part of their plans to attract tourists, writes Global Tourism Reporter Dawit Habtemariam. Habtemariam writes what influencers say about travel can have more clout than other types of advertising. San Francisco Travel CEO Joe D’Alessandro said the words of an influencer are more trustworthy for many people than an ad the organization may air. A 2022 Pew Research survey found 53 percent of social media users purchased something after seeing an influencer they follow post about it. Habtemariam notes destinations are increasingly shopping for suitable influencers instead of just waiting to receive pitches from them. Discover Puerto is launching a request for proposal for an agency to assist with its influencer marketing strategy. Chief Marketing Officer Leah Chandler said the quality of influencers is much higher than compared to five or 10 years ago. Meanwhile, the U.S. national tourism marketing agency Brand USA has a program that loans out trusted international influencers to partner destinations. Next, InterContinental Hotels Group CEO Keith Barr announced on Friday he’s stepping down after six years at the helm, Skift co-founder Jason Clampet and Travel Experiences Reporter Selene Brophy report.Barr cited family as the reason why he’s leaving his post at the UK-based company. He said during IHG’s first-quarter earnings call that the time was right to return to the U.S. considering his daughters will be studying in the country. Barr, who joined IHG in 2000, added he has been living outside the U.S. for roughly 20 years. IHG’s Americas CEO Elie Maalouf will succeed Barr effective June 30. IHG reported that its first-quarter revenue per available room, an important industry metric, was up nearly 7 percent from 2019 levels. The company received a boost from its average daily rates rising 10 percent from pre-Covid levels.Finally, the Hawaii Tourism Authority will have fewer resources for its marketing effortsamid widespread frustration in the state with the industry. The agency has been excluded from the state budget, writes Global Tourism Reporter Habtemariam. Habtemariam reports the Hawaii Tourism Authority now has to request funds from the state’s budgeting and finance department. The governor and legislature will have to approve any funding requests. Habtemariam adds the state government will ensure the agency focuses more on destination management instead of marketing. Lawmakers in the Aloha State recently came close to passing a bill that would have dissolved the Hawaii Tourism Authority.

Episode NotesTravel technology vendor Sabre is the latest major company in the tech industry to shed staff. Sabre announced on Thursday it’s cutting around 1,000 jobs, 15 percent of its workforce, writes Travel Technology Reporter Justin Dawes. Dawes reports Sabre’s move is part of an effort to save $200 million annually and help improve its business operations. Chief Financial Officer Mike Randolfi said most of the job cuts will occur before the end of the second quarter. Sabre reported that it had nearly 7,500 people on staff at the end of 2022. The announcement came during the company’s first quarter earnings call. Sabre generated a little more than $740 million in revenue during the first quarter, a roughly 27 percent year-over-year increase. Next, Tripadvisor is making changes to its products, but what will the new Tripadvisor look like? CEO Matt Goldberg explained Tripadvisor’s strategy at its first quarter earnings call on Thursday, reports Executive Editor Dennis Schaal. Goldberg said the Tripadvisor is introducing new content formats to boost monetization and user engagement. He acknowledged the company monetizes only a small portion of its audience. Goldberg added that Tripadvisor may incorporate generative AI — technology that includes the creation of images, audio and video — in its efforts to improve planning tools. However, Schaal notes that Goldberg’s remarks about generative AI were mostly aspirational. Tripadvisor generated roughly $370 million in revenue during the first quarter, a 42 percent jump from the same period last year. However, it posted a $73 million net loss. Finally, corporate travel agency Navan believes it’s taken a big step to help expand its market share. The company has unveiled an updated version of its AI chatbot Ava that it feels will help corporations save money, writes Reporter Selene Brophy. Brophy reports Ava can help finance teams condense complex spend data as well as provide insights on managing travel budgets. Navan said Ava’s new capabilities include analyzing travel spending to recommend ways to save money, such as changing hotel criteria. Brophy adds Ava is able to write and send an executive summary of its results in several languages.Skift AI Travel Newsletter: AI coverage across travel sectors that’s focused on separating trendy moves from good ideas – in your inbox every Friday. Sign up here