The economy may be starting to recover but the heady days of the 1990s, when travelers paid top dollar for rooms in pricey inns, are long gone, the CEO of the only major hotel company based in the Valley said Wednesday.
"We all keep waiting for 2000 again, but we’re never going back to 2000 for a lot of reasons," Tom Higgins, president of Best Western International, told fellow hoteliers during a meeting at the Arizona Biltmore Resort.
Best Western is an association of individual hotels that are required to meet specific standards to maintain membership and display the brand logo.
There are more than 4,000 Best Western hotels in 80 countries. Most are mid-priced properties.
Higgins said the tourism industry downturn, which has lasted three years so far, is more than just the low of an economic cycle.
Tourist attitudes and habits have changed permanently because of the combined impact of the sagging economy, wars, terrorism attacks and corporate scandals.
Among the biggest changes is in the way people want to vacation, he said.
"People still seem to want to travel," Higgins said. "But they want to do it away from airports because of the hassles and away from prices they deem too high."
Best Western hotels fared better than many major hotel chains during the decline because of the drive-vacation trend.
"Everybody has taken a fair share of the reduced travel," Higgins said. "But many of our properties fit the niche of Americans traveling by car along the interstate. That’s where we are. Many of those properties had record years. And in our destinations, such as San Francisco, we came out better because of our price structure. I don’t want to say everything is fine and we didn’t notice the recession, but our numbers show we fared better than the rest of the industry."
Higgins said hotels will have to reinvent themselves to adjust to changing times.
He compared the situation to the saga of the Swiss watch industry.
Switzerland had 65 percent of the world’s watch-making business in the late 1960s, while Japan had less than 1 percent, he said.
Then Japan invented the quartz movement, and by 1980 the Swiss made less than 10 percent of the watches, while one Japanese brand alone — Seiko — made 33 percent. The Swiss came back with Swatch — 51 parts and 1,000 looks — and again became the world’s biggest watch maker, Higgins said.
Among the major technological changes facing U.S. hoteliers is the rapidly growing use of the Internet where travel customers can easily comparison shop.
"It’s where consumers go to buy," he said. "We’ve got to adapt it to us."
Higgins believes the business travel slump will recover when the economy does.
"Video-conferencing will never replace face-to-face sales calls and meetings," he said.
"Companies establish their travel and entertainment budgets based on how they see the economy."
But he said hotels will have to sell themselves in the future instead of just being ordertakers.
Each hotel will have to find the best way to market itself, but the hoteliers will need to band together to strengthen the industry, lobbying legislators for money, advertising and promoting the destination.