IHIF 2020 Patron Sponsor Interview: Pat Pacious, President and Chief Executive Officer of Choice Hotels International

Everhome - Choice Hotels
Everhome, Choice's flexible accommodation offering

What do you think are the top three trends that will define the hospitality industry in 2020?

First, the hospitality industry has seen seismic shifts over the past years and I’m convinced the future will be no different. 2020 and beyond will therefore continue to require strong flexibility and creativity in the way we operate our businesses to answer to upcoming trends and disruptors – this could include (but is certainly not limited to) how the hospitality industry embraces technology and tailors offerings to guests through personalisation.

Secondly, the global lodging industry is facing headwinds ranging from economic challenges to strong supply pipelines. A strong focus on efficiency both in terms of guest acquisition as well as operations will therefore play a key role — areas where we excel in supporting our franchisees.
Finally, we’re seeing increased attention being paid to the extended stay segment in the U.S. Not only is it one of the fastest-growing segments of the hotel industry, demand far exceeds supply. We more than tripled the size of our extended-stay portfolio over the past two years, and recently launched our newest brand: Everhome Suites, a midscale extended stay brand designed to appeal to the guest of tomorrow.  

Choice sits at the intersection of Franchising / Technology / Hospitality. What benefits does this unique position bring?

Being an asset-light company with over 80 years’ experience in franchising gives us the advantage of being able to focus exclusively on what is best for our owners. Their objectives are ours – our most important being hotel profitability – and we’re always striving to enhance our strong value proposition.

Technology therefore forms an integral part of our business model: we recently deployed choiceEDGE, the first new global reservation system from a hotel company in nearly 30 years. We take pride in having developed the system in-house, which showcases our technology talent and the forward-thinking, fast-paced and collaborative nature at Choice Hotels.

Finally, our brands are proven, sought after, and rated highly by owners and guests. We’re proud to offer a well segmented brand portfolio for every type of owner, every type of guest, and for every stay occasion.   

The boundaries between hotels and alternative asset classes such as hostels, services apartments co-working spaces are blurring: how is Choice viewing this trend? Which alternative asset classes are catching your attention?

We actively follow these trends and we are convinced that they are here to stay as our sector moves ever further into the mainstream for real estate investors. For us, it is all about finding the right partners to respond to these changes. Choice Hotels’ platform offers tremendous potential to leverage our client base, loyalty program and in-house technology, and we continue to strike partnerships that take advantage of this such as we have done recently with AMResorts. Our partnership with AMResorts will offer our more than 43 million Choice Privileges loyalty members the opportunity to earn and redeem points at a portfolio of world-class resorts in desirable destinations.

 Looking ahead to 2020, what are the strategic growth avenues for Choice Hotels?

 As we move into the next decade, we are strategically focused on three core aspects: Brands, Value Proposition and Platform. We will continue building on our proven brands that resonate with the customer of tomorrow. Our value proposition strategy is to improve our same store sales and reduce the total cost of ownership of our brands; thus providing the highest return on investment for our owners. Finally, we are pursuing a platform strategy to grow the number of services we offer to our franchisees, our guests and other travel partners.

Is sustainability important to your company’s strategy, and how are you including it in your business practices

Sustainability is a part of our culture at Choice, and I’m pleased that the company will release its inaugural ESG report this year. There, you will be able to read about our efforts to enable the success of our shareholders, investors, associates, franchisees and their guests—all of whom create a positive impact in their communities. Examples of our work in this area include:

Supporting our powerful network of 12,000 franchisees — the majority of whom are small businesses owners — in their efforts to serve their guests, employees, local communities, and families as they pursue their entrepreneurial dreams.

Promoting environmental sustainability in our business practices, our offices and our more than 7,000 franchised hotels across the globe.

Nurturing a welcoming and respectful culture of inclusion that embraces our franchisees and guests as well as the Choice family of 1,700 associates across the globe.
Being a good corporate citizen in our daily demonstration of our core values of respect and integrity, especially in our approach to governance.

Pat joins the Global CEOs Panel: Re-Defining Hotel Performance taking place 10.40-11.30 on Tuesday 3rd March during IHIF. This power panel brings together the CEOs of some of the largest global brands to discuss their views of what is performance in today's hospitality, and their strategies to achieve it. For further information on this session and IHIF, please visit www.ihif.com