Best Western CEO Kong says ‘Internet changed the way hotels operate’

Life is not always fair.
Few would quibble with that assessment. But what can you do about it?
When you see others promoted whom you feel are less deserving, don’t dwell on them, says David Kong, president and CEO since 2004 of Best Western International Inc. – which calls itself the world’s largest hotel chain.
Concentrate on making yourself stand out from the pack by working on what you do best, Kong suggested to several hundred students at Johnson & Wales University in Providence, during a special address Sept. 27.
“Offer something different that nobody else can do,” he said of advice he followed himself to eventually become head of Best Western.
Kong was invited to speak at Rhode Island’s premier culinary arts and hospitality school by the local student chapter of the American Hotel & Lodging Association (AH&LA), based in Washington, D.C. Working with neither notes nor PowerPoint paraphernalia, Kong tailored his address to young people ready to enter the hospitality field, sounding almost like a graduation speaker as he spoke about doing your best and believing in yourself.
A native of Hong Kong, he has worked in the hotel industry for 39 years, starting as a busboy in a Hawaiian hotel and moving on to work for such well-known chains as Omni, Hilton and, for more than 20 years, the Hyatt Hotels. He was named this year to the United States Travel and Tourism Advisory Board that provides counsel to the U.S. Department of Commerce and is the 2010 chairman of AH&LA.
Although he did not specify which hotel chain he was working for at the time, Kong presented an example of what he did that made him stand out from the crowd. Customer service is, of course, a concern to every hotel, but Kong explained that it is seldom a black/white issue because “guests interact with many people at a hotel” and there are “a lot of points of failure” where something can go wrong. In charge of a hotel where guests’ ratings were lackluster, Kong said, he instilled in his staff the need to create “a stunning first impression” that leads customers to forgive any small mistakes during their stay. Sure enough, feedback became more favorable and Kong won himself a promotion.
Asked by his hosts at Johnson & Wales to discuss the latest trends in the hotel business, Kong summed them up with one word: Internet.
Before the Internet, 85 percent to 90 percent of all hotel reservations in the nation were made by telephone, he said. Now, that number has dropped to less than 20 percent because people can go online to reserve rooms or contact a special travel site such as Expedia, Orbitz or Travelocity to do it for them.
The Internet presents a further challenge to hotels because customers easily can compare prices in what was already a highly competitive industry.
Due in part to the recession, Kong said 2009 was a tough year for the hotel industry in America with an overall 17 percent drop in business and an average 8 percent decline in rates. “This was the first year rates ever went down that much,” Kong said, and he attributed the decline, in part, to the fact that hotels “feel compelled” to lower rates to remain competitive in the face of so much comparison shopping.
Based on 50,800 properties with 15 or more rooms, for a total of 4.7 million guest rooms, revenue per available room nationwide was $53.50 in 2009, compared to $64.37 the year before, according to the AH&LA. In 2009, the trade group said, total industry revenue decreased to $127 billion compared to $141 billion in 2008 and the average room rate was $98, versus $107 in 2008. The Internet has fundamentally changed the way hotels operate in at least other two ways Kong cited.
The No. 1 request that guests have, he said, is for “reliable, high-speed Internet access,” which he called “absolutely essential” in any hotel today. Secondly, the Best Western chain, which has three hotels in Rhode Island, has a full-time employee on board to monitor social media sites such as Facebook and Twitter because “we’re worried about what people are saying about our hotels,” Kong said.
There are advantages and disadvantages to working for a large hotel chain versus a smaller operation, Kong said, when asked by Providence Business News which he would recommend to a hospitality graduate entering the hotel business.
Large hotel chains are immediately recognizable on a resume, he noted, so such experience can provide a newcomer with “a lot of opportunities to grow, to move around and to move up.” For the most part, he said, large chains have accomplished managers who are good leaders with expertise that can benefit novices.
However, working at a smaller operation can expose the newcomer to various aspects of the hotel industry that he or she would not encounter at a large chain, where each job generally is well-defined, Kong said.
“You can have the opportunity to learn about a lot of different areas,” he said.
Asked what would be the best section of the country to work in right now, Kong demurred, calling that a “difficult assessment” and suggesting that the best course of action for a new hospitality graduate would be to go where the opportunities are. “Sometimes you have to go to where the opportunity is, if you’re just starting off, and worry about what region of the country you’ll settle in later,” he said. •