Hotel Online  Special Report


The Pensacola Beach Factor -
Hospitality's Opportunity
By Michael Squires
September 17, 2001

The impact of the 9/11 attacks on our country is being felt deeply by many who were not in New York or Washington.  Individual lives, markets, and entire industries have been shaken by the assault, but there may be a positive result to the severity of the trauma.

Hospitality, particularly, is one of the industries dependent on worldwide financial and emotional stability.  If people and companies are not comfortable with their immediate future, they generally don�t spend as much on travel or take time to relax.  Many of us remember the Gulf War hospitality recession of the early 1990s brought on by an eastern leader�s terrorist threats against America.  Now we have more than threats.  

There is great concern in our industry that a sluggish economy coupled with the attacks against our financial and military centers will derail the hospitality industry and its suppliers.  Hotel stocks are reeling.  Company forecasts were already down for the first part of the year; now most analysts, including Smith Travel Research, predict steeper declines in occupancy and revenue.  

The New York Times reported Monday that Park Place Entertainment was postponing the development of its new Las Vegas tower due to the economy.  Prior to 9/11 several hotel operators announced in a Softscribe Inc. survey they were delaying investment in new projects until next year, again citing the economic slowdown.  This is rational business thinking.  But in contrast, what happened this weekend in a Florida resort community was the complete opposite of conventional wisdom.

We were in Pensacola Beach this past weekend on a family trip scheduled a month ago.  We went because the vacation season concluded on Labor Day and there were plenty of rooms at good rates.  But what we found on Friday evening were huge numbers of walk-ins inexplicably crowding the lobby.  We saw the last room sold to a man who said there wasn�t a vacancy on The Beach and asked why things were so busy this time of year.  There are over 500 rooms on Pensacola Beach, and they were all full, many at rack rate.  What happened?

In speaking with other guests, managers and business owners a pattern of thinking emerged.  Yes, people were shocked and angered by the attacks on our country, and, yes, they were uncertain about the future of their jobs and the economy, but they all responded to a need to separate themselves from the constant barrage of life�s pressure they were experiencing at home.   They had to get away for a while.  The economy of the Florida Panhandle was booming because of the universal need we all feel to establish balance when we are under severe stress.  

No one can accurately predict what will come from the tragedy our country has suffered because this kind of thing has never taken place before.  Smith Travel Research says it is basing its downturn predictions, in part, on the previous Gulf War�s impact.  But that does not take into account the Pensacola Beach factor.   Americans may finally be under so much pressure from the economy, job uncertainty, and now the concern of war that the healthy human drive to establish balance in our lives will be triggered and consciously pursued.   

What took place in Florida was not isolated; the Columbia River Inn in Oregon, and the Mendocino Hotel in Northern California each suffered a wave of cancellations early in the week, only to make up the loss with walk-ins and nearly sell out on the weekend.  These are resort hotels, like the ones in Pensacola Beach, serving large nearby metro areas.  

Hotel operators can take a lesson from the sold out properties on Pensacola Beach and offer special weekend packages to regional markets that meet the need individuals and families will have to establish equilibrium in their lives.  The effects of this tragedy on our industry will undoubtedly be surprising.  But if companies keep Pensacola Beach in mind and have strategies in place for positive results in addition to their damage-control plans, everyone will benefit.  

Michael Squires is president of Softscribe Inc., a technology consulting corporation that specializes in industry intelligence, targeted public relations, and marketing and sales services.  

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Contact:
Michael Squires
Softscribe Inc.
404-256-5512
[email protected]


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