It was a great pleasure for us to recently speak with Jan Freitag, National Director of Hospitality Analytics at CoStar Group and Senior Vice President at STR. Jan is an expert in the hospitality analytics field with over two decades of experience in driving growth and success through the analysis of market trends.
During our conversation, Jan explained the importance of certain data types, and how they can be used to inform decisions that will help hotels succeed. He also spoke about his role within CoStar Group and STR, as well as what's in store for hotels this year.
Tell us about your current role and experience in hospitality data analysis
My background is that I’m a hotel guy. I was born and raised in Germany and did an apprenticeship in a hotel. I then came to the US and found myself in a job that suddenly morphed into a lot of data and data presentations. I’ve been with a company called STR for 20 years. We were most recently acquired by CoStar, which is part of the NASDAQ 100 that does real estate information services across all asset types. They [CoStar] also bought STR and have very deep insight into hotel data - STR is the premier provider of hotel benchmarking data around the world. STR has access to data in 180 countries, so wherever there or 4 or more properties, chances are we are providing market intelligence and have since the late 80s.
My role is to think deep thoughts about hotel data and publish it in writing, industry presentations, or monthly videos, as well as talking with clients.
How do you stay up-to-date on current trends and technologies related to working with hospitality data?
We are fortunate in that we make the data. I have access to the data on Tuesday night before our clients do, and I use to - especially in the pandemic - be very in tune with what’s going on in China because we have global data. We could look at what was happening in China and determine how that would influence what was happening in the United States. At the time, I did a weekly video and webinar that commented on the data. It was and is very easy for me to stay up to date because I’m right at the source of the data.
STR also owns a company called Hotel News Now, which is one of the premier providers of hotel intelligence and articles and news, so obviously I follow that. After 20 years of working, I also have a pretty good network, so there are a lot of people in the industry I can call on and say “hey, I’m seeing this trend, what are you seeing?” or just “What are you hearing? How’s 2023 shaping up?” Ultimately, it's a combination of all of these things.
We are continuing to see a steady market recovery across the hospitality industry. Which sectors are fastest growing, and why?
We like to call recovery a ‘tale of two cities’. First, we have the recovery on the leisure side, which has been super strong boom rates that we’ve never seen before and almost - I hate to say it - no price resistance from the high-end individual leisure traveller.
But, you contrast that with the downtown offices and urban properties so reliant on the urban traveller and those are still in the recovery - if you want to call it that - some are actually hurting. The reason for that is in the pandemic we all learnt to work from home, and the whole idea of returning to offices is a big question mark up and down the east coast, in Europe, and in Australia. We’re not sure if people will be back in the office in the way they were in 2018/2019, and if people aren’t in the office downtime, well they aren’t going to fly to meet with you, they’re going to use Zoom.
So, I think it’s going to be very very interesting to see how 2023 shapes up, and how business travel recovers because it’s got a long way to go.
What strategies can hoteliers use for organising, displaying, and presenting data effectively?
I think you have to start with the obvious - who are you talking to? Are you talking to the owner or the investment committee? Are you talking to a class of trainees? You need to tailor your message that way. The other thing in my job that’s a very big role is understanding and making the difference between interesting and actionable [data].
The data I talk about it is the total US, and even the world. I was at a conference yesterday where I was talking about the global luxury hotel industry so that data is very high level, and it’s interesting - I hope - but I’m not sure it’s that actionable. You’re not going to change behaviour in a specific hotel on a specific street corner, because of what I say about national occupancy. When you’re a hotelier you have to ask yourself - is the data I’m presenting good to know, or is this something I want my audience to take and put into action?
What do you believe is the most under-utilised data hoteliers can benefit from?
At STR, we’re continuing to evaluate new data sources and ask for new data from our partners, and that all flows into the CoStar platform. So, I think segmentation data now is super interesting. The understanding of ‘is the room that you’re selling sold in increments of 10 or more - or what we call group - or increments between 1 and 9 - what we call transient. The interplay between group and transient demand has been quite fascinating to watch, in that the transient, high-end demand in some downtown hotels has really not recovered, but the group side has. What’s the attribution to this? Despite not being in the office as much as we use to be, the head of HR still needs to build a culture - but how do you build culture if you’re not in the office or around the ‘water cooler’? The easiest way to do that is to have a group meeting and get everybody to a resort in a nice location and say ‘Hey, everybody comes in Wednesday night, and we’ll have a team dinner. Thursday morning, we have training, Thursday evening, we have team building, and then everybody flies back out”. There’s suddenly a need for group meetings that weren’t there in 2910/2019 because we were all in the office, all of the time. So, that interplay is very interesting to watch, and it’s a data set that’s super interesting for hoteliers to utilise.
Finally, what are some expectations in store for the hotel industry this year?
Globally, the recovery will be ongoing. APAC, China, and Japan are all re-opening so that’s really good news for travel around APAC. The war in Ukraine gives no sign of easing, so I think Europe is still going to get hit hard because energy costs are going to continue to be up. The recession in Europe is certainly on the horizon - maybe already there in certain countries.
In the US, we’re expecting a recession in Q2, and Q3. Two consecutive quarters of negative GDP growth is technically considered a recession, but this is the first time in our almost 30-year history that we are proposing that RevPAR (revenue per available room) is actually going to grow in a recession. We haven’t seen that in the STR data set before. Why is that? Because inflation continues to be so high, so hoteliers can drive rates. Costs are going up, but rates are probably going to go up as well, so that gives you some RevPAR growth. I think overall it’s that same ‘tale of two cities’. It’s a little spotty or patchy. It’s not smooth sailing for everybody, but I think recovery is ongoing, especially with the APAC re-opening, I think that’s going to be a pretty good year in 2023.