NEW YORK—“You shouldn’t treat AI like the nephew you’ve been obliged to hire. You should treat it like your genius child that you must get the best out of,” said Barry Sternlicht, chairman and CEO, Starwood Capital Group, on stage at the NYU International Hospitality Investment Forum this week.
Talking about the potential of AI in the hospitality industry, he said that if you could get “this genius child… working for you 24/7” it would reward your endeavor many times over. He added: “Be curious, critical, assume you know nothing.”
Sternlicht was in conversation at the New York summit with Jonathan M. Tisch, executive chairman, Loews Hotels & Co. Tisch, in turn, was there to present Sternlicht with only the second ever iteration of the Jonathan Tisch Active Citizenship Award, after handing the gong to Blackstone’s Jonathan Gray last year.
Charitable Work
Tisch said that Sternlicht was a worthy recipient both for his charitable work and the “work he has done for the betterment of lodging”, which he described as “legendary.”
Born to immigrant parents, and a father who had survived the holocaust, Sternlicht said that he had learned the “habits of charity and giving back” from his parents. He also recounted how his mother had dissuaded him from becoming an artist, with the warning that “he would starve”.
Going on to major in Law and Society at Browns University, Sternlicht said that the value of arts majors was “underrated”, and he could see a return to picking leaders with arts-related skills. “They’re now saying that if you learn to code, you will lose your job. With an arts major, it’s about how you think, about asking the right questions. These will be the kind of skills required to master AI.”
Starwood’s Return
Sternlicht touched on the return of the Starwood Hotels brand, which he has been able to reclaim this year following years of dormancy.
Nearly a decade after Marriott International acquired and integrated Starwood Hotels & Resorts, he explained that “the name has reverted back to me,” which had inspired a rebrand of SH Hotels & Resorts.
Today the parent company of 1 Hotels, Baccarat Hotels and Treehouse Hotels, the rebooted Starwood Hotels will be driven by Sternlicht’s “passion for lodging," he said.
“I love lodging. I like the mission of the industry, if you travel, you meet people; nothing breaks down barriers and stereotypes like travel.”
Consumer Challenges
Sternlicht said that he had no intention of resting on his laurels. “The industry is evolving, and consumer taste is evolving,” he noted. “The rise of the independents is hurting older brands.” He described how “piranha brands”, rising thanks to viral engagement on social media, were dethroning brand royalty: “The likes of Estee Lauder, Tom Ford, Jo Malone must face the fact that the Ordinary is a multi-billion dollar brand already, and was much easier to launch through social media.”
He added: “The same thing is happening in every consumer category including hotels – it’s about connecting to the right people with the right mission.”
He also talked about the importance of detail, and getting the basics right. “We just bought eleven hotels in London, and I just went to see them. There is dirt on the street outside one, another has ripped awnings – you have to do things better. But a lot of people don’t do that.”
He concluded: “Taking costs out is for monkeys, driving revenue is the hard part” and reminded delegates that “this is a fun business”. He said: “If you’re not having fun, you shouldn’t be in the business. This industry is good for the world – there’s nothing like it – there’s something for everyone to do.”