Outward Bound
By Karyn Strauss, Associate Editor -- HOTELS Magazine, 1/1/2006
- Outward Bound
- Move Over Eloise
- World Watch
- Hospes Aims At Art In Architecture, Service
- Gostelow Report
- Hoteliers
Outward Bound
With millions of Chinese now traveling abroad,
is your hotel ready
to welcome them?
WORLDWIDE Did you know that one of the determining factors for a Chinese traveler in choosing a hotel is the grandeur of its lobby? What about the fact that Chinese leisure travel is still dominated by group business? Well, InterContinental Hotels Group (IHG) knows. Looking to be the leader in outbound Chinese travel, IHG is investing in a series of research studies to better understand the market and educate its hotels about this quickly growing demographic.
So just how fast is it growing? Thanks to such factors as higher incomes and reduced government restrictions on travel, the World Travel & Tourism Council says the Chinese outbound market has averaged more than 20% growth per annum, and analysts predict outbound travel to reach 50 million by 2008. By 2020 the World Tourism Organization forecasts that more than 100 million Chinese will be traveling abroad, making China the fourth largest source of international travelers in the world.
While Hong Kong and Macau account for the majority of this travel to date, Southeast Asia (Thailand, Singapore, Malaysia) and Australia are quickly gaining ground. Further, as the government continues to grant “approved destination status” to more countries, meaning that leisure tour groups can now travel to new locales, countries such as Germany, Turkey, India and the UK are opening up (the United States has not yet been granted approved status).
But it is not only the volume of trips that is noteworthy. According to consulting firm IPK International’s China Travel Monitor (part of the World Travel Monitor, an ongoing world tourism survey), the Chinese also are among the highest spenders per capita on travel abroad, generating an average of US$2,090 per trip for an average 12-night stay.
Such statistics clearly exhibit the impact Chinese tourists will have on the global hospitality industry in the years ahead. While some compare it to the boom in Japanese tourism in the early 1990s, the sheer size of this population dwarfs any true comparison. However, what may be comparable is that during that period hotel companies worldwide scrambled to get their hotels up to speed on Japanese language and culture. So are they prepared to do the same and more for Chinese tourists?
Advice From The Field “The trend in the West is to non-smoking rooms and restaurants. This is the opposite in China where a large proportion of the population still smokes and is used to doing so in hotel rooms and public places.” “If you are going after the Chinese market, and you want it to be important to your bottom-line revenue, you have to serve fried noodles and a selection of dim sum [at breakfast].” “It is imperative in dining outlets that you have not only the right tea, but also fresh tea rather than tea bags. If you offer a Chinese guest tea leaves in a tea cup, you score points as this is their welcome.” “Chinese are not that used to a ‘do it yourself’ service style. They prefer to be welcomed in the lobby and to interact with Chinese speaking service staff.” |
According to a HOTELS Web poll from August that asked “How are you preparing for the influx of Chinese tourists?” a whopping 46% of respondents said they “weren’t doing anything at this point.” Twenty-five percent said they were working on sales and marketing efforts, yet only 10% said any language training was taking place. While this informal poll may not be the most accurate indicator of the hotel industry’s preparedness, it does illustrate that when it comes to China, Western companies’ radars are clearly set to development and inbound/domestic business. The natural next step needs to be readying to greet these guests when they travel outside their country.
Step 1:
Research The Market
Such is the thinking of IHG. As the first international brand in China with Holiday Inn, the company knows it is well-positioned to capture outbound business. “We recognize that China is one of the largest and fastest-growing exporters of travelers to the rest of the world,” says Carmen Lam, IHG Asia Pacific’s vice president of sales and marketing, who is leading the research program. “The insight [garnered in our study] will
provide guidance and direction toward our China outbound strategy.”
The research—consisting of in-depth interviews and focus groups with travel agents and both leisure and business travelers in Shanghai, Beijing and Guangzhou—looks into consumer behavior, including how Chinese travelers make hotel stay decisions and what markets are the most desirable. Part one of the study was completed this fall and examined issues such as who makes buying decisions, and what are the key drivers in choosing accommodations. Results showed that the majority of travelers still rely heavily on travel agents both for business and leisure travel; using the Web for research. Travelers seek hotels with prime locations, spacious guestrooms with local accents, clean bathrooms, readily available Chinese-speaking staff, and Chinese food and beverage options. Additionally, these travelers often are willing to sacrifice hotel quality to spend money on other tourist activities and shopping and are not lured by frequent-stay programs.
Step 2: Create
Guidelines For Hotels
Lam says this research will help IHG develop sales and marketing strategies, such as fostering strong relationships with travel agents, as well as to educate its hotels around the world about how to welcome these new guests. While IHG’s research may be more in depth than what other hotel companies are doing currently, their work is certainly not alone.
Three years ago Accor devised a set of minimum standards guidelines for welcoming Chinese travelers to its hotels. According to Accor spokesman Peter Hook, the guidelines were developed in Australia because it was one of the first Western countries to get large Chinese tourist groups. The guidelines address such issues as room types—Chinese travelers often still prefer twin beds and smoking rooms; F&B needs, including traditional Chinese breakfast foods; availability of printed hotel collateral and local maps in Mandarin; and additional educational-type information for employees on Chinese culture and etiquette expectations.
Hook says the guidelines will be expanded across the Accor portfolio as demand warrants and will be fine-tuned to local markets. Other recent China initiatives under way at Accor include a cultural training program, hiring of multilingual staff and the introduction of a “guest services desk” to meet and greet customers.
Step 3: Develop
Training Programs
Another major opportunity to capture this market is to send employees to China for training. While this is an area IHG and Accor are exploring, it is one that Geneva-based Kempinski Hotels CEO Reto Wittwer says will be a requirement for anyone who wants to be a manager of a Kempinski hotel. With 30 hotels planned in China, Kempinski wants its employees to be ready to greet these guests appropriately when they venture to a Kempinski hotel beyond China. Wittwer says every manager will be sent to China for one to two years
to learn the culture, the cuisine, the
language. Further, the luxury hotel
company plans to hire Chinese staff
for its hotels around the world to best meet the needs of this burgeoning
demographic.
Move Over Eloise
Atlantis, the marine-themed, kid-friendly resort in Paradise Island, Bahamas, has a new resident—albeit a fictional one—thanks to a new children’s book that tells the adventures of Narda, an 11-year-old, redheaded girl who lives with her father there. The tropical setting operated by Kerzner International was the perfect backdrop for a new children’s heroine, according to author Joe Harris, who has created a variety of well-known characters, including Underdog and the Trix Rabbit. Harris says he was inspired to write Narda after a trip to Atlantis with his own daughter. The story follows Narda through a series of adventures around Atlantis, such as diving on a reef filled with exotic fish and plummeting down a steep waterslide at Atlantis’ “Mayan Temple.”
According to a spokeswoman for Kerzner, this book is the first in a planned series that will follow Narda and her escapades as she grows up in and around Atlantis. Guests at the resort also “will be seeing much more of Narda and can expect lots of surprises,” she says.
World
Watch
EUROPE
Paris ‘Grand Dames’ Fined For Collusion
PARIS Six of Paris’ most
prestigious hotels were fined recently after a four-year investigation by France’s Competition Council found that the hotels were sharing information on prices and occupancy in order to effectively regulate rates. The Crillon, Le Bristol, Meurice, Plaza Athénée, Ritz and George V hotels together were fined E709,000.
The council charged that these hotels had worked together to exploit their position in the ultra-luxury market, with average room rates at these properties reaching E700 and above. “The investigation showed regular exchanges of confidential information among the six hotels regarding their business and the elements
necessary for their marketing plans,” the council said in a statement on the decision.
“Some [bureaucrat] in Brussels decided it would not be possible for the hotels to exchange occupancy and room rate data anymore on the basis that they are likely to collude to fix the prices and that it was going to create unfair competition,” explains Dominique Bourdais, a director at HVS International’s London office. “In my view this is a completely silly piece of legislation. It is essential for hotels to exchange such data. It is healthy to know where they are in position to their competitors, and to adjust their marketing activities to improve rates and ultimately to bring more people to the area to maximize hotel utilization.”
Hotel Le Bristol responded to the council’s action with a statement calling the decision and the hotel’s E81,000 share of the fine “unfounded and unjustified.” (Fines for the individual hotels were determined in relation to their earnings and the length of time they had been involved in the alleged price-fixing.) The Bristol said shared information related only to average revenues and rates across the board, and that the hotels had “never colluded on prices, commercial strategy or market share.”
“The competition was and is still very aggressive,” says Georges Panayotis, CEO of MKG Consulting, Paris. “The judges decided differently. The decision is really considered a strong warning.”
Bourdais believes the fines leveled by the Competition Council are likely to discourage hotels from openly sharing information and keeping written records of doing so but that there will continue to be informal discussion and exchange of information. “But instead of being aboveboard, it will be driven underground,” he says.
Rezidor To Launch Hotel Missoni
BRUSSELS A growing trend in the industry is luxury retailers entering the hotel business. Perhaps the most ambitious plan yet comes from Rezidor SAS Hospitality, which has signed an agreement with the Italian fashion house Missoni to develop and operate a new lifestyle hotel brand: Hotel Missoni. Rezidor expects to have at least 30 hotels open or under development in prime city and resort destinations in Europe and the Middle East by the year 2010. The goal is to have the first three hotels open in 2007.
While the plan marks Rezidor’s entrance into the “lifestyle” hotel category, it is not the company’s first try at partnering with a fashion brand. In 2003 Rezidor had planned a similar concept with Cerruti, however, according to Gordon McKinnon, senior vice president of marketing, brand and corporate communications for Rezidor, “we got caught in the crossfire of a dispute with the owners of the brand and the Cerruti family over rights of use. In the end we were not prepared to accept the risk of having our rights of use challenged.”
Learning from this experience, Rezidor worked closely with the Missoni family to avoid any such missteps. And today development is moving forward with negotiations for Hotel Missoni sites already concluded in the UK, mainland Europe, Russia, Asia Minor and the Middle East.
MIDDLE EAST
Rotana To Launch Mid-Market Centro Brand
ABU DHABI, UAE Looking to fill a growing need for branded, budget-oriented yet stylish accommodations in the Middle East comes Centro, a new brand by luxury hotel operator Rotana Hotels. According to Daniel Hajjar, vice president of sales and marketing for Rotana, Centro will be a 3-star brand about “excellent basics, but no frills.” Hajjar says Centro will be characterized by “modern, trendy and interesting” architecture and “from the inside, we will offer what the traditional 5-star properties offer but on a limited scale. Customers will stay at Centro because they will get what they are interested in: comfort, safety, high level of hygiene, professional staff, state-of-the-art equipment.” Similar to new mid-market brands launched in the U.S. market, Centro will feature a lively lobby lounge area that will encourage socializing as well as “deli-style” dining options.
The company believes that the timing is right to introduce Centro because, as it stands today, most of the budget accommodations in the Gulf region are unbranded with inconsistent standards. Guy Wilkinson, a Dubai-based consultant, concurs: “While the common international perception of the Gulf region is that all hotel guests are ‘rolling in money,’ the reality is that as in the world, the majority of residents are highly value-conscious, and companies operating in the region are continuously looking to control their costs, not least, in terms of travel expenses. Yet accommodation options available to these value-conscious business travelers in the Gulf countries are limited.”
“In terms of product, there is no real competition at this stage,” Hajjar adds. “Renowned brands are offering very simple rooms with basic decoration and little atmosphere.”
Growth plans entail 25 Centro hotels within five years. The company first is targeting Dubai, Abu Dhabi, Cairo and Kuwait.
Hospes Aims At Art In
Architecture, Service
BARCELONA Up-and-coming in the Spanish luxury lifestyle
market is Hospes Hotels & Moments. Founded just after the millennium, Hospes now has six hotels throughout the southern and eastern parts of Spain, and plans to expand into other parts of the country this year and next year, and into other European cities beyond 2007. The long-term goal is 15 hotels in Spain and another 15 in major markets such as London, Paris, Budapest, Prague, Vienna and Stockholm. While private investors behind the company now own all six hotels, Hospes will look to move forward primarily as a management company.
All of Hospes’ hotels are restored historical buildings, including palaces, convents and royal residences, and the company works with architects and interior designers to conserve original architecture and return the buildings to their original grandeur. The interiors focus on light, space and origin.
Hospes’ operating concept is based on customer well-being and revitalization with an aim to offer products differentiated by their authenticity and allow guests to disconnect from daily constraints. Hospes is targeting both business and leisure travelers who feel this need to disconnect and enjoy a time and space of their own. “[Our target audience is] highly educated people who enjoy traveling and look for the essence of each experience, of each destination,” says Managing Director Antonio Pérez Navarro. “They look for emotions and for something that fulfills all of their senses, not just a bed. They want to dream, not just to sleep.” The guest-centric nature of the hotels is reflected in the company name: “Hospes” comes from Latin and means guest. It is also associated with the words “hospice” (a dwelling place for rest and recovery) and “hospitum,” Latin for hospitality.
Rather than being seen as a chain of hotels, Hospes wants clients to think of its products and services as an experience. This is its brand philosophy, and employees are challenged to think and perform tasks according to this philosophy to surprise guests and surpass expectations. The company’s aim is for each hotel to reflect the flavor of its location, and this is carried out through the use of local construction materials, local flora in gardens and local ingredients in food and beverage offerings. “Since every destination is different, every hotel is different,” Pérez Navarro says. All of the hotels, however, are relatively small (fewer than 80 rooms), visually interesting and share a primary focus on customer service.
In terms of food and beverage, each Hospes hotel features a Senzone Restaurant & Tastes outlet, offering dishes with natural, local ingredients “served in a cosmopolitan and traditional way,” Pérez Navarro says. “In Alicante we are currently incorporating a fantastic tomato—the best tomato in Spain and Europe. People need to discover the authenticity of this product. In Granada, we incorporate caviar—the most excellent caviar around the world. People enjoy this kind of experience—to discover the taste, and discover it is locally produced.”
Currently, most Hospes guests are European or American, Perez Navarro says, but he notes that the number of Asian guests is on the rise. The company aims at a ratio of 70% international and 30% domestic guests for its properties. With all six hotels in central city locations, during the week guests are mostly business travelers, while on weekends leisure travelers dominate. Pérez Navarro also notes that a growing number of event planners and business managers are choosing Hospes hotels for meetings because of the inspirational settings of the properties.
Rates and occupancies vary across the six hotels, with average daily rate falling between E135 and E180, except at the Hospes Maricel in Mallorca, where the average is E310, according to Pérez Navarro. He attributes this to both market conditions and the excellent offerings and service at the property (the hotel recently received the Conde Nast Johansens “Most Excellent European Hotel” award). Occupancy is best for the company in Mallorca and Sevilla, where it is currently running at 70% and 75%, respectively. To pull customers into its lower-occupancy newer properties and to get the Hospes name in the front of the minds of potential guests, the company is looking at doubling its television presence in Spain in the year ahead. In addition, it will continue to advertise in Spanish in-flight magazines, worldwide publications such as The Financial Times and on Spanish and European Internet news sites, Pérez Navarro says.
Gostelow
Report
Fabrizio and Rogerio Fasano, Italian-origin fraternal restaurateurs, are succeeding in São Paulo’s Les Jardins area with their launch hotel, the Fasano Hotel e Restaurante, a large restaurant with, unseen by most diners, a rear reception area with a walkway to the block of hotel rooms. Now the family, guided by Hans Heinz, looks forward to a Fasano hotel in Rio de Janeiro and, after that, who knows?
Speaking at his Barcelona base, Victor Clavell, general manager of Hotel Arts Ritz-Carlton and regional director The Ritz-Carlton Hotel Co. for Chile and the Iberian Peninsula, wants more. He would like an additional Ritz-Carlton in southern Spain and one on its Balearic island of Mallorca.
JT Kuhlman, president One&Only Resorts, London, is hardening his resolve to be in city centers. He wants London, New York and Paris. At the same time he is expanding the resort portfolio with his sights set firmly on something in the Sultanate of Oman, Tuscany and perhaps another complete island along the lines of One&Only Reethi Rah, which opened early last year in the Maldives.
Gordon Campbell Gray, CEO of Campbell Gray Hotels, London, similarly is talking about Oman—but he also is keen on Moscow and is close to signing for a new-build in Beirut. He and his design colleague, Mary Fox Linton, also are working on two private yachts for clients.
David Welch, senior hotel specialist, technical and environment department of the Washington D.C.-based International Finance Corp., a member of the World Bank Group, finally signed a Hyatt in Kiev, Ukraine. Now, he says, he is looking for projects in Kazakhstan and Kyrgyzstan. He also is working on the African continent, especially Burkina Faso and Mauritania.
As it happens, the World Tourism Organization, based in Spain, also is working on an African initiative, Mission Africa. Tourism will help the continent, says the organization’s special advisor, Geoffrey Lipman, and hotel development is a vital part of this mega-plan. Lipman already is in touch with Trevor Ward, managing director of the West Africa Collection, Lagos, Nigeria. Within only 18 months Ward, helped by his director of operations Andrew Schoeman (and the marvelously named marketing coordinator God’swill Akpan), has built a fledgling portfolio of three hotels in Nigeria.
Ulan Bator, the capital of Mongolia, may not be on every hoteliers’ wish list (this is the world’s least-populated country, with just over one person per square mile). But Mongolian tourist authorities are working on a 33-floor Mak Tower complex in the city center. Designed like a round ziggurat cone with a giant open atrium, it will include a hotel taking up floors one to four and 13 to 24. The authority also is working on the Turtle Rock Resort Complex, 40 miles (64 km) east of the city, in Tereli National Park. Aimed at cultural tourism, the development will have villas and yurts (traditional tents) for guests.
The Himalayan Ski Village, 2,500 ft. (762 m) above sea level at Kullu, northern India, is aimed at adventurers. Funded by a grant from Alfred Ford, great-grandson of motor magnate Henry Ford, developer John Sims has put together a US$1 billion project that will have sculpted ski slopes designed by International Alpine Design’s Mike Larson, whose credits so far include the expansion of Telluride. Himalayan Ski Village will offer at least 700 bedrooms and suites. One building, the 250-key, antique-looking Fort Hotel, built around a central courtyard, is already said to be attracting the attentions of such management companies as Indian Hotels & Health Resorts Pvt Ltd., New Delhi; Four Seasons Hotels & Resorts; InterContinental Hotels Group; and Mandarin Oriental Hotel Group. A ski village will add at least 300 condo-villas and a convention center to accommodate 2,000 delegates.
Send your news via e-mail to: mary.gostelow@wowtraveler.net
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