Find out what Bill Marriott, chairman and CEO of Marriott International, has to say about what the U.S. can learn from China, how the hotel industry is recovering from the recession, and what really irritates him the most when he stays in a hotel.
Peter Greenberg: You know every time I see you, you’ve opened up more hotels. Here in China, the development has been especially phenomenal. How many hotels are we talking about?
Bill Marriott: We’ll have 60 here by the end of the year, and we’re going to double in the next five years, so we’re really cranking.
PG: But who’s counting?
BM: I am.
PG: Everybody talks about the explosive nature of how the Chinese have developed their infrastructure. I remark to everybody that there are so many airports in China, and there are millions of residents. But when I got off the plane I asked, “Did they evacuate the city and not tell me about it?” There are like 85 gates and mine was the only plane at the gate. Then I realized what the Chinese had done: They’ve built ahead of the infrastructure; they actually built for the future.
BM: They know how get it done. We could sure take a lesson in the United States about how to build, how to get it done quickly, and how to do it right.
BM: You work with local governments to get your permit and the approvals. In China, they know how to get it done and the local governments do not fool around. Look at how many roads they’ve built here in Beijing. Look at how this airport in Beijing is just enormous. And the runway—you’ve never seen so much concrete in your life. It’s incredible what they’ve done.
PG: The real numbers are staggering in terms of what Chinese consume in terms of concrete.
BM: It’s amazing. You just go down the tarmac at these airports here and they’ve got more concrete than half the airports in the United States put together.
Listen to the entire second hour of this show from Beijing here.
PG: One of the reasons we’re here, of course, is the World Travel & Tourism Council, something that you’ve been involved in since it started 20 years ago. It was started as wake-up call for people to understand the economic power of travel and tourism, and how it really does have such a big impact on everything we do. Yet here we are 20 years later having a discussion today about how many people still don’t get that.
PG: Now don’t mince words!
BM: There is no Minister of Tourism in the United States. There is no voice for tourism in the United States. There is a small segment of the Commerce Department that has a few people that are interested in tourism. But you talk to your congressmen and senators and they don’t really recognize how important travel and tourism is. How many members of Congress in the United States have a passport?
PG: I actually know that answer, Bill. It’s about 36 percent. Now how scary is that?
BM: That is very scary, and that is an indication that in the United States our government does not view travel and tourism as an essential industry.
PG: When President Obama made that statement about not going to Las Vegas, and when Joe Biden said he wouldn’t put his family on a plane during the swine flu scare because it was an enclosed environment, the travel industry sort of galvanized. They demanded a meeting and got one with the president.
BM: That’s right.
PG: And you were at that meeting.
BM: I was at the meeting. We told him that we were concerned about his statements, and he said, “Yes, I recognize the value of travel and tourism. I’m from Hawaii and tourism is the total support of the Hawaiian economy.” When asked directly, he said, “I’ll do whatever I can. I’ll support travel and tourism.”
PG: Has he done it?
BM: He hasn’t done much, but he hasn’t made any more statements since then that I’m aware of.
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PG: So look at it as a reverse negative. He’s done a great deal then.
BM: He’s done a great deal by not saying anymore.
PG: What can travelers do to educate their own elected representatives when they’re the guys who are making the policy?
BM: Well, the travelers have to speak out, but the industry has to speak out as well. We in the industry have to know our congressmen, we have to know our senators. We’ve got to continue to impress upon them the great importance of this industry that employs 10 percent of all Americans.
Learn more about the hotels in our Hotels & Accommodations section.
BM: That’s right. It’s the biggest industry in the world.
PG: You know we have a tough economy when airlines can say we can’t pay for fuel, so we’ll just retire our planes to the desert, shrink, and hopefully the law of supply and demand will help us. But you can’t park your hotels in the desert.
BM: No, we can’t, but when business goes down, as it has the last couple of years, we scramble. We go out and find new customers, and we do the best we can to provide the best service we possibly can. We look at all our cost and try to take as much cost down as we can. But we are coming out of this and we’re really doing well. First-quarter business travel was up in the United States. Business is back on the road, groups are booking, and we’re really feeling pretty good about business in the United states. But China is really really taking off.
Learn more in our China Travel section.
BM: No, China is not my problem.
PG: Your problem is getting yield in the U.S.
BM: Our problem is getting the rates up. We’ve had occupancy increases the last six or seven months, and we’re almost back to where the occupancy was in 2007. But we’ve got a long way to go to get the room rates back.
PG: I’ve seen some surprises in locations in the United States where I never thought I’d see them. If you ask the folks in Mobile, Milwaukee, Wisconsin or Kansas City, Missouri, how they’re doing, you know what they tell me? “We’re doing great. We’re doing better than we’ve ever done.” Why is that? “Because we’re not Las Vegas.” They’re booking meetings that would otherwise go to a place like Las Vegas because groups don’t think they’re going to get punished by attempting to have a good time in Milwaukee.
Learn more about this situation with: Government Travel Planners Say Goodbye Las Vegas, Hello Milwaukee?
BM: I think a lot of that is past history. I think we’re seeing more and more resort books where the luxury segment of the industry has come back very strong. Our revPAR indexes, revenue per available room, are up very strongly. Luxury has responded more than any other segment. But it also went down further than any other segment because a lot of rhetoric coming out of Washington. But that rhetoric seems to have passed us, and people are booking and coming back into luxury properties.
PG: I was at a hotel the other day that booked a big meeting, and they were actually instructed by the convention organizers that they could not put any announcement of the meeting anywhere in the hotel. It could not be on the front desk. It could not be on the TVs. They didn’t want anybody to even know they were there.
BM: We run into that very occasionally. I think that’s over with now and I think people are feeling good about the economy. I think this punishment of business that went on as a result of the recession is pretty much over in terms of bad-mouthing people traveling, and telling them to stay home, stay off airplanes, stay out of Las Vegas. Now we’ve go to get together and promote, get our business back, and get our room rates back where they belong.
BM: We promote and we sell. We’re putting together some great sales programs, really good discount programs, and weekend values. You can still get good deals, but you’re going to start paying a little more as time goes on.
PG: Not to mention airline fares. But that’s a problem. If you can’t get on the plane you can’t get to one of your hotels.
BM: That’s exactly right.
PG: So what do you do about that? You’re not starting an airline that I didn’t know about are you?
BM: No, we don’t need that. But you know, you just do the best you can.
PG: I think you travel more than I do. What is the one thing that angers you more than anything when you’re on a plane?
BM: On an airplane? The food.
BM: No, they don’t have it. No food, and all the little knicks and knacks of extra charges .
PG: So you will not be charging for carry-on bags at your hotels?
BM: No, not this year.
PG: Oh look at him, he qualified it! OK, Marriott included now, what is the one thing that angers you the most at a hotel?
BM: A party in the hall at 2 in the morning.
PG: Unless it’s your party.
BM: I don’t have parties.
PG: What about the room design itself?
BM: I think most of the rooms today are designed very very well. I think you’ve got everything you need in there. You need a good desk when you’re working on the road.
PG: Bottom line here, what are you taking away from this trip to Beijing?
BM: I think the fact that China is just growing so rapidly, and the quality of the hotels in this country are unbelievable. People who have never been here would just be blown away when they saw the quality of all the product in this country.They’re really beautiful hotels: well-designed, comfortable, amenities, great restaurants, great service, and wonderful people. They got it together.
By Peter Greenberg for Peter Greenberg Worldwide Radio.
Related links on PeterGreenberg.com:
- Government Travel Planners Say Goodbye Las Vegas, Hello Milwaukee?
- First Hour of Beijing Radio Show
- Second Hour of Beijing Radio Show
- China Travel section
- Hotels & Accommodations section