Marriott International, the world-renowned hotel chain, is preparing for another year of strong growth in 2023, according to the company's President and CEO, Anthony Capuano. Speaking to CNBC-TV18, Capuano forecasted a revenue per available room (PAR) growth of 6-11 percent in the upcoming year, indicating the hotel industry's sustained recovery from the COVID-19 pandemic.

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However, Capuano is optimistic about the industry's future, stating that he does not see an end to the current upcycle of recovery.

Below is the verbatim transcript of his interview with CNBC-TV18.

Q: In your own words, 2022 was a terrific year, you had record financials. Given the global uncertainties that we are seeing today, I know that you have held out a very broad assessment of what the 2023 outlook is. Do you believe that we are likely to be at the higher end of that range, the lower end of that range is demand holding strong, especially in the Asia Pacific region?

A: As you point out, 2022 was a remarkable year. The company set records for fees adjusted EBITA, adjusted EPS. And remember, we achieved those numbers with a very difficult January because of the Omicron variant and with China, one of our largest markets largely locked down for 10 and a half months of the year. So, our forecast for 2023 is for continued strong growth. As you point out, we gave a relatively large range of RevPAR growth globally 6 to 11 percent. So 100 or 200 basis points wider range than we might typically because of some of the economic uncertainty you described.

But I was in Boston last week or two weeks ago, meeting with analysts. All of them ask the right logical questions, given the interest rate environment, given inflation, given socio-political instability in certain areas of the world, don't you see an end to this tremendous arc of recovery? And the answer is we don't see it in the data yet.

The first quarter should be really, really strong when we report earnings in a few weeks. We continue to see strong forward bookings, the only caveat I would give you is for transient business, we are dealing with a relatively short booking window. So the ability to tell you forward bookings look good, could change relatively quickly. But we are just not seeing it in the data yet.

Q: I wanted to talk about India because we are here and there is a lot of attention and focus on how compelling the India’s story is at this point in time. From Marriott’s perspective, you had set a target of 200 hotels by 2025, I believe you are hoping to up that number?

A: Our expectation is that between open and pipeline hotels we have at least 250 hotels across the country by 2025. We are in 40 cities today and that should be 50 cities or more by 2025, and maybe most exciting to me...that results in us creating 10,000 new jobs across India.

Q: You talked about the pipeline in India, which end of the market do you believe, you feel, that you are going to see much more sort of demand coming in, what is going to be the priority in terms of what you intend to focus on here in India?

A: I think in any market in the world our development strategy is relatively simple. Our objective is to make sure we have the right product in every market, our travellers is going to visit for any type of trip purpose. I think here we have got to continue to stay focused on the domestic market which is strong and growing.

I mentioned to you earlier, we had the good fortune to spend a bit of time with your tourism minister, and one of the thing we talked about is the importance as an industry and certainly from Marriott’s perspective, to continue to tell the story globally about what a rich and diverse set of experiences the country offers and we want to make sure we have lodging offerings in all of those destinations.

Q: You talked about your meeting with the tourism minister and we were just chatting before we came on to the stage and you said that India needs to lose a little bit of its humility and tell its story in terms of diversity of culture, tradition and experiences. And just like Marriott you need get some bit of your humility and tell some of your story better, how do you intend doing that?

A: I think that really relates to our culture and the opportunities that we create for our associates around the world. As you point out one of the things I treasure about the company as our humility, but as an industry and as our company we have an amazing story to tell about careers that are created. I have been travelling this week with our leadership team in India, we have been sharing stories about how we started in the industry and if you hear story after story about starting an hourly front-line position and just through hard work and ambition the ability to rise, and I think it’s a unique attribute of the travel and tourism sector and a story we need to tell more forcefully and more vocally.

Q: I just want to talk a little bit on the India connection, I believe 25 percent of your C-Suite is Indian origin?

A: That is exactly correct. Rajeev Menon who runs APEC region for us, Satya Anand - who runs Europe, Middle-east and Africa, Tina Edmundson, who runs our Global Luxury Group all are born and raised in India.

Q: As we look at the trends that have emerged and shaped the travel and hospitality industry post-COVID, which ones do you believe are less likely to be more permanent? What has happened in terms of technology and the use of technology, where do you find the balance between too much contact, too little contact and I know most hospitality majors are dealing with some of these balances at this point in time. What do you believe will be the transient changes that you believe are likely to be the more permanent changes?

A: Technology is an interesting topic on two fronts, I do think one of the permanent changes we will see is an acceleration in the adoption of technologies that existed long before the pandemic. So when you look at take rates for mobile check-in, mobile key, chat functionality - those capabilities always existed, but by necessity or by a sense of apprehension early in the recovery more and more guests are adopting those technologies, discovering the ease with which they can enable their travel and I think that will continue for years to come.

The more impactful change I think is this idea of blended trip purpose and we talked about this a little bit in our fourth-quarter earnings call. The fact that Sunday and Thursday were the days of the week that were covered most quickly...I think the best and most critical data that support this idea that more and more travellers are blending leisure and business travel or leisure and group travel, I think that is great news for our industry and it’s a trend I expect to see continue into the future.

For full interview, watch accompanying video

First Published:Apr 12, 2023 5:44 PM IST