New York City Hotels Appeal to Tourists and Locals With Innovative Design

Beth J. Harpaz  / Associated Press

The lobby of the Baccarat Hotel is one of the city’s most luxurious. Beth J. Harpaz / Associated Press

Skift Take: From historic bars and rooftop mini golf courses to creative co-working spaces and a veritable library of thousands of books, these NYC hotels have something for everyone, whether you’re just visiting town or a local.

— Deanna Ting

New York has hundreds of hotels, located in different neighborhoods, with different styles and amenities.

But a hotel is more than just a place to rest your head. Many hotels have something truly special to offer, and often those features can be experienced even if you’re not staying overnight. Stop in for a drink, for dinner or even just take a peek inside the lobby or the bar.

Here’s a quick look at five Manhattan hotels and what’s unique about each of them.

BEST HISTORIC RESTORATION

The Beekman hotel opened just last year at 123 Nassau St., but its Temple Court restaurant and bar has already become one of Lower Manhattan’s most popular after-work spots. It’s located in a landmarked 1881 building that was vacant for years before the hotel’s painstaking historic restoration brought it back to life. The building’s star attraction is a glorious nine-story atrium surrounded by decorative wrought-iron balconies. In the lobby, antique oriental carpets suggest exotic adventure, while Edgar Allan Poe’s portrait connects the site to an even earlier incarnation as the Mercantile Library Association, frequented by Poe and other 19th-century writers.

MOST PLAYFUL

Moxy hotels are part of the Marriott chain, but they were designed to appeal to millennials and they have the look and feel of fun, chic boutique hotels. The Moxy Times Square, which opened in late September at 485 Seventh Ave., has already become a playground for the city’s 20somethings. It’s hosted everything from a graffiti master class to a pop-up shop with an “embroidery bar” offering personalized designs. But it’s the Moxy’s Magic Hour rooftop bar and lounge that’s the killer attraction, with a view of the Empire State Building, live DJs, a carousel, a minigolf course called Foreplay and topiary bears in naughty poses. You can even order up a $99 crash pad from the cocktail menu.

COOLEST COWORKING SPACES

Hang out with the cool kids on the Lower East Side in the coworking spaces at the Public hotel, 215 Chrystie St. It’s got everything from stadium-style seating to long white sofas, along with spots for food, coffee and cocktails. Bring your laptop, sketchpad or notebook and come up with the next big idea. There’s also a small, tranquil park with a picnic table just out front, a sleek rooftop bar with great views and a groovy escalator lined with neon-like lights. The hotel opened earlier this year and is the brainchild of Ian Schrager, co-founder of the legendary 1970s disco Studio 54 and the businessman credited with creating the concept of boutique hotels.

BEST THEME

There are 6,000 books in the Library Hotel. You’ll find books in the lobby, in your room, at the rooftop bar and in the hotel’s reading room. Located at 299 Madison Ave., it’s a block from the grand New York Public Library building with those famous stone lions out front. You can even see the public library from some of the guest rooms. But the really clever thing about the Library Hotel is that it’s organized according to the Dewey Decimal System, which uses numbers to classify books by subject. Every floor is themed on a different Dewey Decimal category — for example technology, social sciences or literature. And each room is themed with art and books on a topic within that category. Looking for a romantic place to spend the night? On the philosophy floor, there’s a room themed on love.

MOST LUXURIOUS LOOK

You may know the name Baccarat from the company that produces some of the world’s finest French crystal. But you may not know that there’s a Baccarat hotel, open since 2015 and discreetly located at 28 W. 53rd St. across from the Museum of Modern Art. If you can’t afford an $855-a-night room here, how about a $42 cocktail called La Belle Epoque? As you walk to the bar, take in the crystal chandeliers and candelabras, the sparkling stemware and bowls, the white sofas and bouquets of perfect, bright red roses. It’s not just bling. It’s a sumptuous look that simply defines luxury.

Ryan Wolkov

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Thomas Cook Sees Profit Slump in UK Division

Thomas Cook

Thomas Cook’s Sentido Tucan Hotel in majorca, Spain. The company has seen profits in its UK division fall. Thomas Cook

Skift Take: Thomas Cook indicated that the problems in the UK were specific to this summer and that overall the business is in good shape. That might be the case but if the UK economy is hit by any Brexit-related issues in 2018 it could be a similar story – or worse – next year.

— Patrick Whyte

Thomas Cook’s UK business has reported a fall in profit of 40 percent after a mixture of hotel price increases and a weak pound took their toll.

An improved performance in other markets meant that overall the companies full-year pre-tax profit rose by 35 percent to $61 million (£46 million).

The pan-European tour operator said the problem in the UK was down to a number of issues. A more competitive market in Spain put pressure on costs and selling prices and the continuing struggles of the pound following last year’s Brexit referendum gave rise to increased costs. The company also blamed the disruption caused by Hurricane Irma.

Underlying earnings before interest and taxes slumped from $115 million (£87 million) to $69 million (£52 million) in the unit.

Thomas Cook had previously guided that increased demand to Spain was likely to push prices up.

“After four consecutive years of profit growth, margins in our UK business declined due to a more competitive market environment, especially for holidays to Spain,” said Chief Executive Peter Fankhauser.

There was better news for Thomas Cook in its airline division and in its other European markets. German airline Condor, which had been struggling in recent years, moved into the black and underlying profits were also up in Continental Europe and the Nordic region.

Fankhauser said: “Looking to the year ahead, we can see real momentum in our Group Airline, and expect our Continental Europe and Northern Europe tour operator businesses to continue their good performance. While conditions are challenging in the UK, we have implemented a set of actions to improve performance.  Overall, based on current trading, I believe that we are well-positioned to achieve a full year operating result in line with market expectations.”

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New Skift Research Report: The Future of Blockchain in Travel Distribution 2018

Skift Take: Our channel checks and industry data point to a relevant future for blockchain technology in travel distribution. However, proponents will need to move fast in creating compelling applications that perform better than what’s already out there.

— Luke Bujarski

Yesterday we launched our latest Research Report, The Future of Blockchain in Travel Distribution for our Skift Research subscribers. Numerous reports and articles have now summarized the disruptive potential of blockchain in travel. However, these are typically broad and barely touch on all or many of the various areas where blockchain could permeate travel. We believe that the discussion now needs to get more granular.

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In this report, we dive deeper into the online travel distribution value chain, particularly for hotels, to get a better read on the implications of this technology that promises so much. We offer data on distribution mix by distribution channel, cost of acquisition by channel, current and forward-looking adoption rates of blockchain by the travel industry, hotel advertising spend by distribution channel, how this will likely change over time, and more.

Blockchain technology is compelling because it offers a prescribed solution to some of the more burning issues now playing out in online travel distribution. Assuming that blockchain can deliver on superior speed, cost, and user experience for both the supplier and customer, then hoteliers and airlines could gradually adopt it. This conclusion is based on current sentiment in the market about existing channels and general attitudes and frustrations with existing third-party relationships.

We also stress that blockchain technology is still new, and that it will take time for these platforms to develop the necessary standards needed to make a meaningful impact on the market. We also note that online travel distribution is a moving target. Existing players recognize the various friction points and are proactively working to build sustainable businesses. Travel is also a highly competitive market. Big technology companies including Google and various China-based players are steadily grabbing share of the total addressable global consumer market.

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High commissions and access to customer data are the two core objections that hoteliers express when it comes to their relationships with OTAs. Hoteliers want to build more direct relationships with the customer, in order to market bookings more effectively but also add-ons and up-sells. OTAs typically obscure key customer data including emails from their hotel partners. Understandably, OTAs want to own the customer relationship as do the hotels. OTAs incur enormous marketing costs to acquire those customers. Advertising spend on platforms like Google account for the majority of costs for these platforms. Hotels justifiably feel entitled to more customer data, given the commissions that they pay to the OTAs.

Figure 10

Source: Skift Research State of Hotel Direct Booking Survey 2017

Decentralized platforms promise total transparency when it comes to customer data. Here, we note that a small majority of hotels are dissatisfied with the amount of data that they collect from their OTA partners. Interestingly, independent properties tend to be more satisfied than branded properties. Here, we can only assume that OTAs are more willing to share their data with independents. Intuitively, this makes good business sense for OTAs since loyalty programs are less relevant to independent properties. Once obtained, hotel chains can market their brand and properties across their entire network of hotel inventory.

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Subscribe to Skift Research Reports

This is the latest in a series of monthly reports, data sheets, and analyst calls aimed at analyzing the fault lines of disruption in travel. These reports are intended for the busy travel industry decision-maker. Tap into the opinions and insights of our seasoned network of staffers and contributors. Over 200 hours of desk research, interviews, data collection, and/or analysis goes into each report.

After you subscribe, you will gain access to our entire vault of reports conducted on topics ranging from technology to marketing strategy to deep dives on key travel brands. Reports are available online in a responsive design format, or you can also buy each report a la carte at a higher price.

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Airline Food Conundrum – Paid Meals Winning Out Over Freebies

Gate Group

Airlines have limited food budgets so Gate Group created a new idea, adopted recently by LATAM. The airline will put all of its food budget into one dish, with passengers paying extra if they want salads, starters or a real dessert. Gate Group

Skift Take: Airline food isn’t always tasty, but passengers probably shouldn’t compare it to what they find in a restaurant. Delivering food to an aircraft is a logistical challenge, and it’s amazing the system works as well as it does.

— Brian Sumers

Editor’s note: This series, called Airline Insiders, introduces readers to behind-the-scenes decision-makers for airlines. Unlike our ongoing airline CEO series, Future of the Passenger Experience, we will not question the highest-ranking executives here. Instead, we will speak with insiders who guide decisions on airline operations, networks, marketing, and the passenger experience. 

Today, in the third installment of the series, we speak to an executive with Gate Group, the world’s largest airline caterer and retailer. 

You can read all the stories in the series here.

Travelers love to complain about airline food. On the long-haul flights where it’s still served for free, many complain it’s too salty, or fatty, or that it tastes like it just left the freezer. And while economy class passengers may gripe most, many business class customers share similar concerns.

Anne De Hauw wants to change that. She’s vice president for innovation at Gate Group, the world’s largest airline caterer, and she may know more about airline food than anyone on the planet.

Her job is tricky. Airlines want better quality food — despite what the average passenger may think, customer satisfaction is important to them — but often they don’t want to pay a penny more than necessary for catering.

De Hauw and her team must be crafty, suggesting solutions that won’t increase an airline’s costs. Increasingly, that means asking passengers to pay for food, either for the entire meal, or special add-ons, like an after-dinner ice cream.

Charging for what was once free may not seem like a passenger-friendly move, but De Hauw said Gate Group’s research shows millennials — a market segment airlines now want to attract — don’t mind it. Many fly Norwegian Air on transatlantic flights and happily pay for food and drinks.

“They would rather pay for good than get free food which isn’t good,” De Hauw said.

Skift recently spoke to De Hauw about new trends in catering. We also asked her about issues that have long vexed passengers, such as why airline coffee rarely tastes right and why flight attendants often have so much trouble explaining the wine list.

Note: This interview has been edited for length and clarity.

Skift: What’s Gate Group?

Anne De Hauw: Gate Group is the largest airline caterer and retailer, and it’s owned by HNA, a Fortune 500 global corporation, based in China. They are experts in the aviation sector, in tourism, infrastructure, real estate and some other areas.

Skift: How many airlines does Gate Group work with?

De Hauw: We work with over 300 airlines. We serve most of the full-service airlines somehow. Some could be only the catering. Some could be the equipment. Some could be warehousing or last-mile provisions. Some could be retail. Some could be all of this.

Skift: People love to say they hate airline food. Does that bother you?

De Hauw: No. It doesn’t bother me. Actually, I agree most of the time. That’s precisely why I like my job, because I can hopefully help turn that perception around and improve the food experience. The perception is still there, and there is still a lot of room for improvement.

The other thing that is important is that people have no idea of the complexity behind airline meals — the safety standards, the supply chain, the number of meals we have to prepare for each flight. We have crew meals, gluten free, kosher, you name it. People don’t really have an understanding of the journey each of those meals takes before they end up in front of the passenger.

Skift: How do you fix this perception?

De Hauw: We put in place an innovation center at Gate Group three years ago. Our innovation process starts with doing research — focus groups with passengers and crew. We figure out what passengers expect and that’s the starting point of our development process. We then make a business case to look at commercial viability.

Skift: People often complain airlines don’t carry enough fresh food, either for sale or for free. But I’ve heard that on the plane, people always go for comfort food — regardless of what they said in the focus group. True?

De Hauw: Yes. We have done research and actually people, unconsciously, look to comfort themselves because there’s that sentiment of fear and uncertainty. And they’re also not that comfortable on the flight, because they’re sitting in a seat with everybody on top of each other. There’s not much to do and you’re up in the air with limited space and entertainment.

People are looking to pass time, and food is one way to do that. We usually allow more guilty pleasures in the air than on the ground.

Skift: Does that mean if an airline boards salads, no one buys them?

De Hauw: Yes, actually it does. We have one very recent example from a customer, who had in their menu, a fruit salad. They loaded one fruit salad per flight, and the one fruit salad was never, or rarely, sold. It’s there and people like to see it. They like to see a healthy option but they’re not buying it.

Skift: Let’s say you’re a premium airline, and you’re feeding your business class passengers on a long-haul flights. What are you spending per customer?

De Hauw: It’s not a lot compared to the price of a business class ticket. Depending on the airline, and the number of stars they have with [the ranking agency] Skytrax, it’s about $25 for food and equipment — the china, the cutlery, the glass, the napkin, the pepper and the salt, the tray.

Skift: And in economy class?

De Hauw: It’s a bit less. It depends on the airline, but I would say on average about $8, also [including] food and equipment. If you calculate the number of passengers flying per airline, times the cost of the food, every penny [airlines] can reduce is significant, [and falls to the] bottom line at the end of the year. Caterers are under a lot of pressure in terms of food costs when it’s complimentary.

Skift: We’re starting to see some long-haul carriers — generally low-cost airlines — charge for food on transoceanic flights. Do you see this trend growing?

De Hauw: I don’t think it will happen overnight but I think over time there will probably be an evolution. Millennials want to have great food. It can be simple, but it needs to be good. They would rather pay for good than get free food which isn’t good.

Skift: Some airlines with free food now let coach passengers buy up to a business class meal. Do customers do it? Or do they prefer free?

De Hauw: I think the quality of the complimentary meal has a big impact. If it’s OK, people will probably not spend more for an upgraded meal. However if the upgraded meal really is a very attractive meal — maybe branded with a chef’s name — yes, it would have a big impact. Also, when there’s a preorder, so people can reserve their meal before they fly, they will do it. The trend is definitely going in that direction. In the future, we think airlines will lean more to retail and preorder.

Skift: A couple of years ago, I asked Frontier Airlines CEO Barry Biffle why his airline doesn’t serve free soda, since most consumers believe bulk-bought Coke is cheap. But he suggested each soda for an airline costs more than at Costco. Do you know what it costs to get one Coke to an airplane?

De Hauw: The Coke example is dependent on the airline, and how much Coke they need. But the higher cost is because of the supply chain and the operation behind it. The cans need to be sorted in the catering unit at the airport. They need to be sorted into trolleys. It is all planned in advance how much Coke goes into each trolley. The catering then needs to be driven by the high-loaders of the caterer at the airport and loaded on the airplane. That area is a highly-secure area. And the price of a high-loader is around $200,000. Of one high-loader. That’s the truck that rises to access the aircraft.

The whole process of boarding all these elements has a big impact on the cost. That’s why it is more expensive on board.

Skift: You told me recently in New York that airline food is some of the safest in the world. But last month listeria was found on some surfaces at your Los Angeles facility, and a few airlines suspended some food service. What happened?

De Hauw: There was listeria found on the drains and on the ground in one of our units. We immediately took action to make sure that the bacteria was removed.

We are reconstructing our hot kitchen in LAX but are working with a mobile hot kitchen temporarily in some cases, and are catering out of Las Vegas in other cases.

If something goes wrong, we are of course giving our full attention to solving the problem. Safety is all regulated. There are very severe standards and safety regulations. We need to comply. We have a compliance team that is constantly visiting our units and checking the quality to make sure that we remain complaint.

Skift: You still believe airline food is among the safest in the world?

De Hauw: Yes. One reason for that is the shelf life of the food needs to be quite long because of the whole supply chain. It takes on average about 24 hours between the food production and the moment that the passenger eats the food. An airline cannot have their passengers become sick from their meals. It’s a very safe food experience, that’s for sure.

Skift: ANA’s CEO told me recently his airline won’t serve sushi because it’s hard to make it taste right at 35,000 feet. What is else is tough?

De Hauw: Any food which is sensitive to having bacteria. Raw fish is very sensitive. It needs to be extremely fresh to be good. And the supply chain for airline catering is not tailored for very fresh foods.

Ice cream is also harder because ice cream that is supplied but not consumed is wasted. Everything that is milk-based is difficult, too, [for temperature-related reasons.] We are working at solutions to overcome that problem. One of them is a chilled trolley. It’s a trolley with a fridge inside, to ensure the temperature inside the trolley remains stable and anything that is not consumed during the flight does not necessarily need to be wasted, but can get re-offered or resold.

Coffee on board is difficult too.

Skift: I’ve heard the problem with coffee is the water on the planes. Is that accurate?

De Hauw: Oh, it’s much more complicated. For brewed coffee, you need to have a coffee machine in the air, and the battery needs to be FAA approved. There is of course the pressure element to it, and there is the overall risk of things going wrong in the air. Having a coffee trolley is something we are developing but it takes a long time because it needs to be approved. I think we’ll get there.

Skift: Last year, KLM tested a rolling beer keg on board. Could other airlines follow?

De Hauw: It was more like a promotional stunt because, as I just mentioned, every item that goes on board needs to be approved [for safety]. And that particular trolley was not approved [by regulators.] But it was tested by KLM and KLM took the risk and the responsibility of putting it into the air anyway. Other airlines are not likely to do that. But yes, it is something we are working on. But if you think of the limited space on board and the space that one trolley filled with beer takes, it may not be the most commercially efficient solution, let’s say.

Skift: You recently introduced a new food service for LATAM long-haul flights that’s a hybrid free/pay menu. How does it work?

De Hauw: For LATAM, we started to work about two years ago on a transformational economy class solution, where the food experience is much improved. Instead of having a traditional tray with the dessert, the salad, and the bread and the butter, the coffee cup and the whole thing at the same time in front of the passenger, we put all the value where it matters. That means in one dish that’s a good dish. We started onboard tests in December 2016.

Skift: Does anything at all come with the main dish?

De Hauw: Today, the passenger receives a piece of bread with the meal. The piece of bread is focaccia. It’s a superior quality piece of bread if you will.

And after that, in a second service, they get a dessert snack. It’s a route-specific chocolate-based item. It’s a not a full dessert, and it still leaves room to buy an ice cream.

Skift: What if I want salad?

De Hauw: You don’t get a salad, but we are working on ancillary revenue proposals for LATAM where you will be able to upgrade your meal. You will be able to buy salads, buy starters, buy an ice cream, and buy champagne on top of that main dish.

Skift: What do customers think?

De Hauw: We have done surveys on board LATAM to make sure the passengers are satisfied, and the average net promoter scores doubled. And LATAM was also able to save in trolley space. For LATAM this has been a financially good solution. Space, weight, and crew are the savings generated by [the program].

Skift: What else are you working on in the innovation center?

De Hauw: We are working with several airlines on preorder, [so passengers can choose what they want before departure]. We are also improving our retail offering. We are working on on-demand [dining] as well. It is an initiative for the front cabin where the passengers not only chose what they eat, but also when they eat.

Skift: When I fly in business class, I hate when airlines tell me when I must eat. Why haven’t more airlines adopted dine-on-demand?

De Hauw: It’s an added complexity for the crew and the crew is of course very much dictated by unions. Every handling for the crew is [set by policy]. And crew also has the right to take a certain amount of time of rest on board. If you introduce dine-on-demand and everyone asks at a different moment when to eat, then the flow of the crew is disturbed. That is what makes it challenging.

Skift: Often, flight attendants know little about the food on board. I know you want to fix this this problem. How?

De Hauw: We are developing a digital platform designed by the crew and for the crew so that together they can share experiences and learn from each other. We are trying to design platforms where the crew becomes the ambassador of the airline so they are more informed of the quality of the food, the personality of the food, the origin of the food, how it is prepared. They get trained in the wines better, so they are much more involved in the whole learning curve and become a better host onboard.

Skift: Does that mean flight attendants will stop asking customers whether they want red or white wine, and start being more specific?

De Hauw: Exactly. They should be able to tell you where the wine is coming from, what year it’s from, or whether it’s a dry wine or this or that. They should be better trained in what they are serving. From all the research we have done recently, it’s very clear that the crew makes or breaks the customer experience. If the crew is not friendly or not hospitable, then the [net promoter score] is already bad. The first thing that airlines need to do is make sure that they have great crew. That’s the first thing — before the food.

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Video: Travel Investors on Why Booking Sites Still Have Plenty of Room For Growth

Skift

From left, Mark Mahaney, managing director and analyst at RBC Capital Markets Research Division; Natasha Kuhlkin, managing director and portfolio manager at Dennison Associates; Bonny Simi, president of JetBlue Technology Ventures, and Erik Blachford, venture partner at TCV spoke on stage about climate change at Skift Global Forum in New York in September. Skift

Skift Take: Is this only the beginning of the beginning of online travel? With a recent downbeat set of results from online travel agencies, it’s a question that’s hotly debated these days.

— Dan Peltier

Mark Mahaney, managing director and analyst at RBC Capital Markets Research Division, asked the travel industry to keep one big number in mind – $150 billion – which was the combined market cap of Priceline, Expedia, Ctrip and TripAdvisor. It has subsequently dropped to $135 million.

“Each of these companies still account for less than 10 percent of global room nights sold so it’s not like there’s any 800-pound gorilla in the space yet,” Mahaney said at Skift Global Forum in New York City in September. “Versus the opportunity, they’re still relatively small.”

These companies’ combined market caps have subsequently dropped to $135 million, however, in a rough period for the online travel agencies.

At a time when major hotel companies like Hilton Worldwide are focused on getting more travelers to book direct, Mahaney’s statement seems particularly resonant. Hilton CEO Christopher Nessetta, for example, recently said he believes Airbnb will act as a hedge for his business against the likes of Expedia and Booking.com and cause the latter two companies to become more competitive.

Mahaney and other investors speaking on a panel at Skift Global Forum agreed that there’s still plenty of room for innovation and growth at these companies.

From an investor’s perspective, the travel industry is interesting because there’s a ton of technology behind the scenes, said Erik Blachford, venture partner at TCV, speaking during the forum. “It’s still possible to grow companies that have giant market caps but in some industries that not how it shakes out.”

You can watch the entire interview above, or consider reading more coverage of Skift Global Forum.

In many ways, technologies like artificial intelligence, augmented reality and virtual reality have moved to the foreground and are integral parts of some travel companies’ long-term technology strategies.

New and emerging technologies like artificial intelligence are starting to get enough scale for large companies to care about them, said Bonny Simi, president of JetBlue Technology Ventures,

Some travel companies are partnering with startups whether it’s by launching an incubator or through another investment vehicle, said Simi. “Startups are growing very quickly and I think it’s because of the success of Airbnb quite frankly,” she said.

“Corporations are listening,” said Simi. “What a startup needs is to have that market particular on the B2B side and companies willing to adopt that technology.”

Although some major travel brands like TripAdvisor apparently aren’t listening to budding technologies as well as they should be, said Mahaney. “TripAdvisor is a company that’s made some major mistakes in terms of product innovation,” he said. “It’s reflected in what’s happening with its stock prices and fundamentals and they haven’t grown profits in three or four years and that’s a real tell in a secular growth industry.”

Mahaney said he’s cautious about TripAdvisor and its future. “I think they could probably use a strategic acquisition if somebody acquired them but I don’t think Priceline would be that acquirer and I’m a little bit stumped as to who that would be,” he said.

At this year’s Skift Global Forum in New York City, travel leaders from around the world gathered for two days of inspiration, information, and conversation for panels such as this, as well as solo TED-like talks on the future of travel.

Visit our Skift Global Forum site for more details about 2018 events.

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EasyJet CEO Carolyn McCall Will Be a Hard Act to Follow

EasyJet

An EasyJet aircraft. Former TUI Group executive Johan Lundgren is taking over from Carolyn McCall. EasyJet

Skift Take: The best CEOs know when it’s the right time to quit. Things may look rosy now, but EasyJet could be in for a tough time if the UK’s Brexit negotiations go badly.

— Patrick Whyte

Carolyn McCall’s appointment as CEO of low-cost airline EasyJet back in 2010 left plenty of airline insiders confused.

“Am I missing something?” one analyst asked the Financial Times. “I don’t know her, but I read the press release about her appointment and I can’t see how they came to the conclusion she was the right person for the job.”

Seven years later, after turning EasyJet into one of Europe’s strongest airlines, McCall is returning to her media roots having had the last laugh on those who said she wasn’t up to the task.

She’s not quite quitting at the top – last year’s Brexit vote has taken off some of the shine – but her successor Johan Lundgren will arrive for work on December 1 to find a company in pretty good shape.

Some of its closest competitors are either struggling or have gone out of business, the acquisition of a portion of Air Berlin will give it greater exposure in Germany, and the threat posed by the UK’s departure from the European Union has been partially nullified by setting up a new airline based in Austria.

“It’s probably the easiest it’s been actually for quite a long time in terms of the plates that are spinning… because we chose to do Air Berlin, we know what we’re doing,” McCall said on a conference call with journalists after EasyJet’s full-year results announcement. “We’re very, very strong at execution and therefore that’s in our control.

“We have really reduced the risks of Brexit to this organization by having a European airline in Austria, [and] by having a UK airline in the UK. So actually the risks of Brexit from where we were in June 2016 to today are massively reduced… all we need at the moment is a bilateral [agreement] between the UK and Europe and every airline needs that and every consumer needs that.”

Hard Act to Follow

Coming in to the job in such a favorable environment is what makes things tricky for Lundgren.

He is following a CEO who arrived with no experience and managed to change the fortunes of what had been a pretty dysfunctional airline. One of McCall’s biggest achievements has been to keep founder and largest shareholder Stelios Haji-Ioannou relatively happy.

Creating a new European airline may have helped deal with the initial shock of the Brexit vote but it won’t be able to protect EasyJet from a slide in consumer confidence in the UK if negotiations with the EU go badly.

And then there are the risks from digesting Air Berlin.

“Air Berlin slot costs are considerable, with £60m ($79.4 million) of operating losses and £100m (132.4 million) of exceptionals in 2018E, on top of the purchase cost,” analyst at Liberum said in a note to investors.

The deal won’t become profitable until 2019, long after its main architect has left.

Lundgren has a firm base on which to build, but events have a habit of disrupting even the best airlines. To understand that he only needs to ask his predecessor.

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Announcing All 2018 Skift Forum Dates

Skift Take: Today we’re prepping for Thanksgiving by showing our appreciation for our Skift fans by treating you all to a surprise — We’re announcing the dates for our 2018 Forums!

— Rafat Ali

Today in the U.S. the Skift team is getting excited to celebrate Thanksgiving with their friends and family, but before we left the office for the week we wanted to do something to show you, our Skift fans, how thankful we are for your unwavering support.

That’s why today we are treating you to the ultimate surprise — We’re announcing the dates for all of our Forums in 2018! That’s right! Today you’ll get to check out the dates for our upcoming events and even register for a handful of them at our Early Bird pricing! Check out the details on each Forum below and as always email forum@skift.com for sponsorship opportunities to get involved in amplifying your brand to the best audience in all of travel!

Skift Forum Europe

When: April 4, 2018
Where: Cafe Moskau, Berlin
What: Skift Forum Europe is unlike any other conference in the region because it examines Europe as a bellwether for many of the leading trends in global travel.
Savings: Only 8 Early Bird Tickets at €300 OFF Remain! 

Save on Skift Forum Europe Now


Skift Tech Forum

When: June 5, 2018
Where: Silicon Valley — Venue Coming Soon
What:  With the help of our Skift Research team, Skift Tech Forum is a one day conference that plans to explore the tech disruptions happening in the retailing, merchandising, and distribution (RMD) of travel.
Savings: 33 Super Early Bird Tickets at $250 OFF Remain!

Buy Super Early Bird Tickets to Skift Tech Forum


Skift Restaurants Forum

When: September 25, 2018
Where: New York — Venue Coming Soon
What:  Skift Restaurants Forum will be a first-of-its-kind event, taking a big picture look at the business of dining out, and the intersection of chefs and restaurants + digital and social technology.
Savings: Tickets will be on sale soon! Stay tuned for an announcement.


Skift Global Forum

When: September 26-27, 2018
Where: New York — Venue Coming Soon
What:  Now in its fifth year, our flagship Skift Global Forum brings the biggest CEOs and professionals together for 2.5 days of non-stop learning and networking.
Savings: Just 15 Super Early Bird Tickets at $1300 OFF Remain!

Register Now Before Super Early Bird Tickets Sell Out


Skift Forum Asia

When: November 29, 2018
Where: Singapore — Venue Coming Soon
What:  For the first time ever, we’ll be putting the Skift lens on all things happening in travel in Asia. This one day conference will be hyper focused on the travel innovation taking place in Singapore, China and beyond.
Savings: Tickets will be on sale soon! Be on the lookout for an announcement.


So that’s what 2018 looks like for the Skift team and the travel industry at large! Looking to get involved in sponsoring any of our events? Email forum@skift.com and our team will work with you to create a custom solution for your brand.

Ryan Wolkov

PRC Time Shares

Author: Ryan Wolkov

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Duty-Free Retailers Get Smart — New Luxury

Heathrow Airport

Model Laura Bailey reopens Heathrow Airport’s Terminal 5 in January 2015. Duty-free shopping is still very important for airports. Heathrow Airport

Skift Take: Gone are the days when duty-free retailers could lazily rely on consumers to freely spend their cash in airports. The rise of online shopping has forced them to become much more creative when it comes to generating sales.

— Patrick Whyte

The Skift New Luxury newsletter is our weekly newsletter focused on the business of selling luxury travel, the people and companies creating and selling experiences, emerging trends, and the changing consumer habits around the sector.

We’ll keep in mind the needs of the specialist travel agents who sell these products as well as the sophisticated consumers who shop for them.

Before online retail became such a big thing, duty-free retailers had it pretty easy. Customers, with plenty of time to kill, would wander around an airport looking to spend their money, thinking they were getting a good deal.

But with most people now comfortable shopping on the web, this isn’t necessarily still true. Of course these stores still have a captive audience, but consumers are a lot more clued in when it comes to pricing.

To get around this, airports have had to invest heavily in upgrading the shopping experience and retailers too are changing the way they do business. This week, writer Laura Powell has been looking into the future of duty-free shopping to see what companies are doing to keep travelers spending.

— Patrick Whyte, Europe Editor

Five Looks at Luxury

The Shifting Strategies of Luxury Duty-Free Retailers: With competition from online retailers rising, airport duty-free shops selling luxury goods need to up the ante. Some methods they are using seem to be successful, while others may start annoying potential customers.

The Wharf Turns Washington Into a Waterfront City: Even an established tourism city like Washington, D.C. needs new destinations. While the capital city’s newest attraction has nothing to do with politics (thank goodness), it has everything to do with breaking down the walls between tourists and locals.

Buick Bets on Attainable Luxury With Latest Sub-Brand: Although the auto industry sits adjacent to travel with its own tricks and trials, executives in both camps are looking to respond to luxury consumers’ shifting priorities with the right balance of brands and packaging. Avenir is a good example of a team that’s doing it right.

Celebrity Cruises Is Building a Lux New Ship to Sail the Galapagos: People already pay a pretty penny to sail the Galapagos Islands. Will they spend more to do it on a new, high-end ship? Celebrity Cruises is banking on it.

International First Class Fades Even as Emirates and Singapore Debut New Suites: Another article about the death of first class? We get it, already. As business class becomes more lavish, fewer passengers are willing to pay a major premium for a first class suite.

Subscribe

Skift Europe Editor Patrick Whyte [pw@skift.com] curates the New Luxury newsletter. The newsletter is emailed every Tuesday.

Sign up for Skift’s New Luxury Newsletter

Ryan Wolkov

PRC Time Shares

Author: Ryan Wolkov

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Officials Finally Detail Initial Chaos Caused by Trump Travel Ban

Craig Ruttle  / Associated Press

Protesters assemble at John F. Kennedy International Airport in New York on January 28, 2017. Craig Ruttle / Associated Press

Skift Take: As long suspected, both surprise and incompetence contributed to the illegal and unprofessional behavior of some officials tasked to implement the first Trump travel ban.

— Andrew Sheivachman

Customs and Border Protection was caught off-guard by President Donald Trump’s travel ban despite being the entity responsible for implementing it, the Department of Homeland Security’s inspector general said.

In letters sent Monday to members of the Senate, the inspector general’s office said the CBP leadership had “virtually no warning” the executive order was coming and “was caught by surprise.”

And it says DHS and CBP leaders didn’t know the answers to basic questions, such as whether the order would apply to green card holders. CBP’s inability to issue “definitive guidance in the early days” of the order’s implementation, the office found, “contributed to significant delays” at ports of entry.

The report also found problems in the government’s compliance with court orders lifting the ban, including wrongly preventing passengers from boarding planes to the U.S.

The findings are referenced in letters to members of the Senate complaining that DHS is stalling the release of a comprehensive report the inspector general’s office compiled looking into problems with the order’s implementation.

Trump’s original travel ban sought to temporarily suspend the U.S. refugee program and block the entry of nationals from seven majority-Muslim countries into the U.S. The order sparked chaos at airports and a flurry of lawsuits, which led to the order’s suspension. The administration has since made several attempts to revise the order to try to better hold up to legal scrutiny.

The letters summarized the findings broadly, but Inspector General John Roth said he was barred from releasing the rest of the report, which was submitted to DHS on Oct. 6, until the department signs off on what it considers privileged information.

DHS spokesman Tyler Houlton defended the department, saying its “many officials conducted themselves professionally, and in a legal manner, as they implemented an Executive Order issued by the President.”

But he said that material within the report “is covered by privileges afforded by well-recognized law.”

“This should come as no surprise as many of the activities in implementing the Executive Order were conducted amidst a large number of lawsuits and, later, court orders that shaped the Department’s response,” he said in a statement.

Roth, who became inspector general in 2014, said in the letters that he was “particularly troubled by the Department’s threat to invoke the deliberative process privilege, as this is the first time in my tenure as Inspector General that the Department has indicated that they may assert this privilege in connection with one of our reports or considered preventing the release of a report on that basis.”

“In fact, we regularly have published dozens of reports that delve into the Department’s rationale for specific policies and decisions, and comment on the basis and process on which those decisions were made. Indeed, that is at the heart of what Inspectors General do,” he added.

This article was from The Associated Press and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to legal@newscred.com.

Ryan Wolkov

PRC Time Shares

Author: Ryan Wolkov

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Uber Paid Off Hackers Who Stole Customers’ Personal Information

Uber

Uber CEO Dara Khosrowshahi is shown here at a company meeting in late August. Khosrowshahi inherited scandal after scandal when he became CEO a few months ago. Now, what’s he going to do about them? Uber

Skift Take: If we gave an award for the travel company that routinely makes bad choices, Uber would be a contender in 2017.

— Sean O’Neill

Hackers stole the personal data of 57 million customers and drivers from Uber Technologies Inc., a massive breach that the company concealed for more than a year. This week, the ride-hailing firm ousted its chief security officer and one of his deputies for their roles in keeping the hack under wraps, which included a $100,000 payment to the attackers.

Compromised data from the October 2016 attack included names, email addresses and phone numbers of 50 million Uber riders around the world, the company told Bloomberg on Tuesday. The personal information of about 7 million drivers was accessed as well, including some 600,000 U.S. driver’s license numbers. No Social Security numbers, credit card information, trip location details or other data were taken, Uber said.

At the time of the incident, Uber was negotiating with U.S. regulators investigating separate claims of privacy violations. Uber now says it had a legal obligation to report the hack to regulators and to drivers whose license numbers were taken. Instead, the company paid hackers to delete the data and keep the breach quiet. Uber said it believes the information was never used but declined to disclose the identities of the attackers.

“None of this should have happened, and I will not make excuses for it,” Dara Khosrowshahi, who took over as chief executive officer in September, said in an emailed statement. “We are changing the way we do business.”

After Uber’s disclosure Tuesday, New York Attorney General Eric Schneiderman launched an investigation into the hack, his spokeswoman Amy Spitalnick said.

Hackers have successfully infiltrated numerous companies in recent years. The Uber breach, while large, is dwarfed by those at Yahoo, MySpace, Target Corp., Anthem Inc. and Equifax Inc. What’s more alarming are the extreme measures Uber took to hide the attack. The breach is the latest scandal Khosrowshahi inherits from his predecessor, Travis Kalanick.

Kalanick, Uber’s co-founder and former CEO, learned of the hack in November 2016, a month after it took place, the company said. Uber had just settled a lawsuit with the New York attorney general over data security disclosures and was in the process of negotiating with the Federal Trade Commission over the handling of consumer data. Kalanick declined to comment on the hack.

Joe Sullivan, the outgoing security chief, spearheaded the response to the hack last year, a spokesman told Bloomberg. Sullivan, a onetime federal prosecutor who joined Uber in 2015 from Facebook Inc., has been at the center of much of the decision-making that has come back to bite Uber this year. Bloomberg reported last month that the board commissioned an investigation into the activities of Sullivan’s security team. This project, conducted by an outside law firm, discovered the hack and the failure to disclose, Uber said.

Here’s how the hack went down: Two attackers accessed a private GitHub coding site used by Uber software engineers and then used login credentials they obtained there to access data stored on an Amazon Web Services account that handled computing tasks for the company. From there, the hackers discovered an archive of rider and driver information. Later, they emailed Uber asking for money, according to the company.

A patchwork of state and federal laws require companies to alert people and government agencies when sensitive data breaches occur. Uber said it was obligated to report the hack of driver’s license information and failed to do so.

“At the time of the incident, we took immediate steps to secure the data and shut down further unauthorized access by the individuals,” Khosrowshahi said. “We also implemented security measures to restrict access to and strengthen controls on our cloud-based storage accounts.”

Uber has earned a reputation for flouting regulations in areas where it has operated since its founding in 2009. The U.S. has opened at least five criminal probes into possible bribes, illicit software, questionable pricing schemes and theft of a competitor’s intellectual property, people familiar with the matters have said. The San Francisco-based company also faces dozens of civil suits. London and other governments have taken steps toward banning the service, citing what they say is reckless behavior by Uber.

In January 2016, the New York attorney general fined Uber $20,000 for failing to promptly disclose an earlier data breach in 2014. After last year’s cyberattack, the company was negotiating with the FTC on a privacy settlement even as it haggled with the hackers on containing the breach, Uber said. The company finally agreed to the FTC settlement three months ago, without admitting wrongdoing and before telling the agency about last year’s attack.

The new CEO said his goal is to change Uber’s ways. Uber said it informed New York’s attorney general and the FTC about the October 2016 hack for the first time on Tuesday. Khosrowshahi asked for the resignation of Sullivan and fired Craig Clark, a senior lawyer who reported to Sullivan. The men didn’t immediately respond to requests for comment.

Khosrowshahi said in his emailed statement: “While I can’t erase the past, I can commit on behalf of every Uber employee that we will learn from our mistakes.”

The company said its investigation found that Salle Yoo, the outgoing chief legal officer who has been scrutinized for her responses to other matters, hadn’t been told about the incident. Her replacement, Tony West, will start at Uber on Wednesday and has been briefed on the cyberattack.

Kalanick was ousted as CEO in June under pressure from investors, who said he put the company at legal risk. He remains on the board and recently filled two seats he controlled.

Uber said it has hired Matt Olsen, a former general counsel at the National Security Agency and director of the National Counterterrorism Center, as an adviser. He will help the company restructure its security teams. Uber hired Mandiant, a cybersecurity firm owned by FireEye Inc., to investigate the hack.

The company plans to release a statement to customers saying it has seen “no evidence of fraud or misuse tied to the incident.” Uber said it will provide drivers whose licenses were compromised with free credit protection monitoring and identity theft protection.

–With assistance from Erik Larson

This article was written by Eric Newcomer from Bloomberg and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to legal@newscred.com.

Ryan Wolkov

PRC Time Shares

Author: Ryan Wolkov

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