Undeterred by Europe’s continued economic troubles, the London-based Small Luxury Hotels of the World (SLH) is bullish about its membership’s revenue growth in 2012.
The consortium of 525 independent 4-star and 5-star lifestyle hotels located in 74 countries has made a goal of expanding to 550 hotels by the end of this year, principally targeting South America. SLH is also investing in e-commerce to boost direct booking, having recently launched an iPad app.
To find out more about the company’s plans, HOTELS spoke with SLH CEO Paul Kerr.
HOTELS: Tell me more about your plans for expansion.
Paul Kerr: We’re focusing on South America. We believe that there are a lot of hotels down there in South America that would benefit greatly from being part of the brand SLH.
It would offer more choice for our customers. Brazil — that is the hot market for us. We’ve already got quite a few hotels in Argentina.
HOTELS: What separates SLH from its competitors? What sets SLH apart, and what is the collection’s most unique characteristics?
Kerr: Our membership’s average size is 50 rooms, and it has been that size for 20 years. That is what sets them apart. The average consortium includes much larger properties.
Also what sets us apart is our hotels are totally and utterly independent.
We have a very diverse portfolio. A third of our consortium are city center, a third are resort and a third are country houses.
HOTELS: What is the biggest draw or perk for a hotel when it is part of SLH?
Kerr: Ours is that we have 155,000 club members globally that have signed up for our loyalty program.
We offer instant benefits to the members from their very first stay, but obviously the more you stay, the greater benefits you receive. We offer special flash sales for our members. It’s not all about discount, though; it’s more about added value.
They represent a huge amount of our bookings, something like 70% of all our slh.com bookings. Growth in The Club, SLH’s guest loyalty program member bookings, was up 150% to 140,000 members at the end of last year, so hotels can look forward to that as a great perk.
HOTELS: Why is SLH prioritizing investment in e-commerce?
Kerr: There is a huge swing to brand bookings. Travel agents are still 65% of our business, but 15 years ago it was 90% booked by travel agents. Also, people are going mobile all the time. We have a significant increase — triple percentage points — from a very low base of iPhone and iPad bookings. Currently SLH receives over 2,000 visits every week from iPad users, with the first week of February 2012 seeing 63 reservations made through the iPad.
HOTELS: What is the state of luxury travel in times of austerity, especially in the European market?
Kerr: This whole austerity thing doesn’t really affect the top end of the market. Also, all those Asian countries don’t have austerity. They’re not like the Europeans and the Americans that borrowed loads of money they didn’t have — they lent the money.
This year SLH has seen a 17% increase in revenue year-to-date when compared with the year-to-date 2011 figure and a 12% increase in the number of room nights. The ADR at a brand level starts at US$359.
HOTELS: Does SLH have any plans to change its fee model as The Leading Hotels of the World has?
Kerr: We don’t believe we should charge a loyal customer to be part of a club. The customer gives us data, and for that he or she gets to use our hotel. The Leading Hotels of the World, they have increased their minimum fee, so that means it’s far more expensive upfront for hotels. Our hotels won’t want that because our hotels are small.