With the departure of former Kimpton Hotels & Restaurants COO Niki Leondakis comes the accession of new COO Mike DeFrino, who has been with the organization for 17 years and, as a result, has helped deliver a somewhat seamless transition as one of the original boutique operators continues to grow from a handful of San Francisco-based hotel-restaurant concepts created by founder, the late Bill Kimpton, to a company that will soon have some 80 hotels – hardly the small niche operator the legendary founder would have anticipated today.
Kimpton made important news this week when it launched its new loyalty program and website. Just before the news broke, HOTELS had a chance to speak with DeFrino about these developments as well as broader opportunities he sees for the organization. Here is a slice from that interview with more appearing in the September issue of HOTELS Magazine.
HOTELS Magazine: How long have you been with Kimpton and where do you fit into the culture in the post Niki Leondakis era?
Mike DeFrino: I’ve been with Kimpton for 17 years. I got my first set of general manager keys with Kimpton after being with Ritz-Carlton for about 10 years. I became the poster child for East Coast growth for Kimpton, opening all of our hotels in Chicago and then I was the first employee in Washington D.C. I went up to New York and Boston and down to Miami, and on and on. Then about eight years ago we restructured and I became the senior vice president of hotel operations, managing growth from maybe 25 hotels to the 60-plus hotels today.
We were able to make that transition when Niki left very smoothly and seamlessly because there was so much comfort in what I’d been doing already and my extreme familiarity with all the properties, all the operations and, more importantly, all the people that make it happen.
H: Where is the company heading from here?
MD: As an industry and a company we’re sort of at a confluence of the growth in the boutique niche and, of course, there are so many competitors jumping into the market – whether it’s one or two hotels or major sub-brands or regional players. It’s an exciting moment for lifestyle hotels because they’re being accepted and they’re taking a bigger and bigger chunk of the hotel market. At the same time, we’re the largest player in that niche and we’ve been the leader for many, many years, and that is a role we’d like to keep. To do so we have to continue to innovate and be on the forefront.
We also think that since the majority of the C-suite guests are coming to us from big brands in many cases those are people who have certain expectations and they’re in some cases maybe leery of the whole boutique-operating model. So we’re trying to make that transition for them from big brand to boutique much easier, and much more comfortable for those converts.
At the same time our company is moving over the billion dollar mark (in revenue) this year and significantly over it probably next year, and going from 60 hotels or so that are open and operating right now to about 80 in the next two years…. We believe that if we continue on our current growth path and keep building our pipeline the way it’s been over the past several years that by 2019 we could be at 100 hotels.
H: Are all those hotels in the pipeline signed and financed?
MD: There are 15 signed deals and five that are in the final stages of negotiation. Then we’re doing more and more new-build properties and more of our properties are becoming more significant and more grand, and in some cases higher room counts with much more meeting space.
So we’re finding that we have to start to adopt processes and procedures that are going to help run properties that are really significant and are going up against, in some cases, luxury brands. We’re opening a hotel in Austin, Texas, and the Four Seasons across the street is in our comp set. So we have to bring our game to the next level, as well.
So all these things are happening at once and we thought deeply about that and said let’s continue to push the envelope and let’s do things that are going to keep us in the lead and make us an attractive prospect to both customers and investors.
H: Can you elaborate on how make the traditional brand customer more comfortable with Kimpton?
MD: The website, of course, is our front door so all of our digital presence is being upgraded significantly and I think that helps people with their comfort in getting to know Kimpton, getting to understand the quality of property that we manage and own, as well as the sophistication of our booking process and the seamlessness of all of our tools.
We’ve always prided ourselves on being sophisticated in our booking tools and having great services, but we also now are being much more conscious of making sure the service delivery process at the property is executed at both a Kimpton level and at a local level. With this many hotels we have the opportunity to string the thread through the properties more tightly. The brand cue a guest sees at one Kimpton should exist at another Kimpton. That may be something physical like every property having a wine hour or a yoga mat in the room, or bikes to borrow for free in the lobby, or it could be something related to service, or great bars and restaurants, and design that is interesting and fun.
So we’re trying to balance very carefully those brand cues with those local, individual property cues and we think we’re creating a hybrid that is not a brand in the way that people look at brands. We’re trying to brand that Kimpton feeling and experience, and be very diligent about the execution of that from property to property. That is the key, in our evaluation, to our future.
H: Do you have any data that shows how many guests are coming over from brands to Kimpton?
MD: We don’t have a survey number. However, we do ask our first-time guests through our surveys what other brands they use. If this is their first time at the hotel where did they stay before? What we found is that 75% of the people who answer those questions are first time guests who said they are coming from other brands and not from other individual boutique hotel companies, or they don’t have any loyalty to a boutique company and often they can’t have loyalty because most boutique operators don’t have enough distribution where a true traveler can stay at the same boutique brand everywhere they go. We’re the only ones now who are starting to have that girth and helping us become that brand which has never been available to travelers before. So we think we’re in a unique spot.