The hotel industry is undergoing a sea change.
In April, shareholders voted to approve a deal for Marriott International to pay about $12.4 billion to acquire Starwood Hotels, effectively creating the biggest hotel company in the world. Traditional hotel groups are coming up with new strategies to combat the rise of new travel technologies and alternative accommodations.
And according to Amar Lalvani, CEO and managing partner of Standard International, those new technologies are what’s driving some of the biggest changes in the industry today.
“At the very minimum, it’s creating a supply problem,” Lalvani said to Business Insider of alternative accommodations like Airbnb. “But for now, we think the consumer still thinks of hotels first. Once this new generation thinks of Airbnb first, then hotels, then the industry will have a bigger problem.”
Standard International operates five hotels in New York, Los Angeles, and Miami, in addition to several properties with the Texas-based Bunkhouse Group. The Standard hotels are especially known for their dining and nightlife options — at the High Line, for example, the Standard has both a popular happy hour spot in its Biergarten and a glamorous rooftop bar with Le Bain.
The hotel also recently announced a partnership with Casper to create what they call “Sleep-In Cinema,” a night when guests can take in classic movies from a Casper mattress.
“We double down on what we do well, which is communal spaces and entertainment,” Lalvani said. Airbnb and other services like it, Lalavani said, are too distributed a network to be able to offer the same experience.
Another big challenge facing the hotel industry: online travel agencies.
Both Expedia and Priceline have grown in value and led a number of acquisitions in the online booking space in recent years, but the cut they take in the form of commission makes them a serious threat to hotels.
“We’re combating that with innovation and by knowing our customers,” Lalvani said.
Standard International just introduced a new feature called Standard Time, which allows guests to choose their own check-in and check-out times across all five of its properties. Once the hotel knows when guests will be checking in and out, they can use that information to schedule housekeeping and make more arrival options available to other customers.
Also earlier this year, it released a new app called One Night Standard, which, like HotelTonight, makes the most of the properties’ unused inventory. After 3 p.m., anyone can log onto the app and see what rooms are still available for that night.
“We found that those people were some of our most loyal customers,” Lalvani said. It seemed that many of the app’s users were people who lived locally, but who maybe wanted to have a spontaneous stay at the hotel for a special occasion or a late night at work. “What we’re seeing is a merging of the hotel and tech worlds.”
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