The Next 100 Years: Innovators and Disruptors Shaping the Future of Hospitality - By Amy Wang

This year marks the hundred-year anniversary of the Cornell Nolan School of Hotel Administration, founded in 1922 - and on April 26, 2022, industry leaders and experts convened for a keynote webinar to commemorate this occasion and celebrate the school and its faculty’s contributions to hospitality-centered research and thought leadership.

The keynote was co-produced by Cornell’s Center for Hospitality Research (CHR) and eCornell and moderated by Hannah DeMaio, vice president of brand strategy at Women Leading Travel & Hospitality NAPCO Media. Panelists included Jamie Cohen, chief financial officer at Vacasa; Heeyon Kim, assistant professor of strategy at the Cornell Nolan School; and Emily Weiss, senior managing director of Accenture’s global travel industry and CHR Advisory board member. Their discussion centered around the strategies of hospitality industry innovators and disruptors, lessons to be learned from these forerunners’ successes and failures, key drivers of innovation and disruption in travel, and predictions for the future.

Innovation and disruption

As more and more technology startups enter the hospitality market, “innovation” and “disruption” have been the talk of the industry, but what do these terms actually mean? Whereas innovators develop “new products, processes, or business models to create value for customers or employees, “disruptors,” according to Professor Kim, take it a step further by “significantly [changing] how the industry works.”

Well-known industry disruptor, Airbnb, for example, started as “a couch-surfing type of bed-and-breakfast,” before it became the leader in the home-sharing market (Source: Statista). Connecting travelers with homeowners looking to rent out their extra space turned out to be a billion dollar business idea and redefined lodging. Similarly, Cohen pointed out how ride-sharing service Uber redefined mobility and Expedia, the first online travel agency (OTA), redefined how people booked travel. And as Weiss mentioned, up-and-coming disruptors like citizenM, a modular hotel company, and Sonder, a short-term rental company, are poised to further redefine aspects of the hospitality industry. The defining quality these disruptors share? A talent for unlocking customer value by doing things differently.

A disruptor’s competitive advantage

Oftentimes viewed as a threat by established companies, soon-to-be disruptors can fly under the radar. According to Kim, disruptors often start out as smaller companies with inferior products at the lower end of a market, concealing them from established companies until they suddenly take hold—for example, the once-obscure Netflix displacing Blockbuster.

These characteristics give innovators and disruptors some advantage over traditional organizations—but they’re not all. A “test and learn” mindset—in which companies are unafraid to test new ideas—is key, agreed Weiss and Cohen. While large, established companies can implement this mindset, it comes more easily to Internet-first companies, which are easier to scale, suggested Cohen.

Disruptors often invest in mobile-first design and “high-quality, easy-to-use” technology to reliably solve customer “pain points.” They can also capitalize on a convergence of different industries by creating a “seamless” end-to-end user experience that solves something for customers, such as the need for food and transportation fulfilled by Uber Eats, added Weiss. Embracing tech, she noted, disruptors are capturing guest and employee data and applying it holistically to solutions.

Making space for disruption

As disruptors emerge, companies may feel a need to shift strategies to compete with them. In a caveat to the dynamic described earlier, Kim noted that while disruptors often “seem threatening,” most of them actually fail—it’s more important for incumbent companies to play to their strengths than to try and expand into every avenue.

Therefore, companies sometimes need to make space for disruption rather than directly competing against it. Focusing and capitalizing on existing strengths is critical for growing organizations, but so is prioritizing and rewarding progressive thinking from the top-down. As Cohen described, this includes fostering a mindset for technological advancement among employees, but also forming specialized incubation teams that can focus on building products, testing, iterating, and creating minimal viable products (MVPs). As these teams are separate from day-to-day operations, there’s no risk of intra-company competition for resources. Other strategies, suggested by Weiss, include embracing the broader “ecosystem” of other organizations that can complement and build on your strengths, and creating new executive roles to “elevate the importance of innovation.” She noted that for an old industry like hospitality, embracing change at this stage is critical and will open doors to new opportunities.

Drivers of travel and hospitality innovation

Innovation and disruption in hospitality are not causeless phenomena. What has been driving them over the past decade? According to Cohen, the proliferation of cell phones, which have created guest expectations around technological accessibility; the emergence of a gig economy based around mobile design, enabling a shift from a “do-it-yourself” to a “do-it-for-me” mentality; and the desire of guests to “live like a local,” tapping into “personalization.”

Lingering effects from the pandemic are still driving innovation yet to come. As Weiss mentioned, contactless, which has been a “conversation piece” for a long time, has finally been pushed forward by COVID, and new business models centered around “digital nomads” and “workspitality” have arisen from a need for flexibility in living and working arrangements. Climate and sustainability issues, as well as inclusion and diversity—such as increased accessibility for persons with disabilities during travel—have also become prominent drivers of hospitality innovation. Finally, although unpredictable, new technologies such as Virtual Reality (VR) and the Metaverse will likely impact hospitality too.

Lessons from other industries

When it comes to innovation, hospitality could learn from other industries. Weiss suggested retail, for example, and the relative ease of canceling a dinner reservation compared to a flight or hotel room booking. Consumer expectations surrounding the ease of these transactions may lead to a corresponding “retail-ization” of travel.

Cohen looked toward tech companies that not only “transformed” their industries, but created an “expansion in the addressable market,” such as OpenTable and Doordash, making things so easy that use-cases expand beyond what people would typically think.

Future outlooks

Looking ahead, the panelists gave their predictions on the next big disruptor in the industry. These included social and environmental issues, as well as VR and new payment models. In the end, however, Kim commented on the unpredictability of future disruption, pointing out a need to both look at smaller companies and macro changes—for example, those in the areas of technology, demographics, work, and lifestyle.

With the last hundred years in purview, travel and hospitality now look forward to another century of unprecedented change. To catch all of the panelists’ insights on this exciting time, watch the full keynote.

Amy Wang '24

Amy Wang is a staff writer for the Cornell Peter and Stephanie Nolan School of Hotel Administration's Centers & Institutes. She is a prospective English major in Cornell’s College of Arts and Sciences. She can often be found writing for the Cornell Daily Sun and editing for the literary magazine Rainy Day. It is her appreciation for the written word that motivates her to produce articles on the research taking place at the Centers & Institutes.