Editor’s Note: This interview is part of Skift’s CEO interview series. This particular series is with hospitality CEOs talking about the Future of the Guest Experience and the evolving expectations and demands of hotel guests. Check out all the interviews as they come out here. Also, enjoy the previous series on the Future of Travel Booking, with online travel CEOs.
In 1966 Larry Korman’s father realized that there was demand for furnished apartments with short-term leases as an alternative to traditional hotels. It started with just one apartment, which Korman started working at when he was ten years old. He later went through a training management program to learn the more “traditional formal art of hotel hospitality.”
By the time Korman graduated from Duke University, the one apartment had turned into 23 independent units around Philadelphia. Korman went around integrating the individual management and maintenance efforts of each apartment under a single umbrella, KormaSuites, as a way to save on the costs.
In 2005, Korman launched AKA, a collection of luxury serviced residences in urban centers that’s grown to include New York, Philadelphia, Washington, Los Angeles, and London. Unlike his more suburban properties, which appeal almost exclusively to business travelers, AKA properties also compete for the leisure travel market, especially among international travelers.
We spoke with Korman, Co-CEO of Korman Communities and president of AKA, about the personalized guest experience that the extended-stay accommodations offer, how technology’s role changes based on length of stay, and the growing group of “elastic” guests.
Skift: How does the guest experience at an extended-stay brand differ from a traditional hotel?
Larry Korman: We have something for somebody staying two weeks to three months, which is our sweet spot for length of stay at an AKA.
Rather than room service, you have a full kitchen so if you want popcorn at 1am or make tea, you do it in your own kitchen. If you want to go to the grocery store and get blueberries and cereal, you can do that. If you want to go downstairs and have breakfast, we have that.
We have something called the “Live It!” experience for somebody who travels for a longer length of time. Rather than just sit at a bar or watch cable TV, we’re creating experiences. A guest might say, “I’ve always wanted to take swimming lessons or photography lessons or learn how to sleep better.” We set everything up. You tell us what you want.
We have a partnership with New York University School of Medicine Sleep Disorders Center and New York Sleep Institute where guests can create their suite to be more sleep inducing. If you want to learn how to play guitar, speak a language, or take cooking or nutrition classes, we set anything up. It can be Tuesday afternoons or three times a week.
If you want to play guitar with a well-known musician or take lessons then we can make that come true. Rather than residents taking a step backwards in their lives, there’s a way to take two steps forward. They might be gone for six weeks, but they’re going to come back healthier or with a new language.
Skift: What are some of the changes in expectations or demands that you’re seeing from the luxury extended-stay customer today?
Korman: We’re finding that a lot of the guests are coming in with their own content so we’ve invested in monitors and bandwidth in each suite. It’s a chance to stay competitive.
Technology is important, because at the end of the day people want a strong complimentary Internet connection to watch their own content from the comfort of their living room or bed. When people leave home, they want technology, wellness, and cleanliness.
Some of the tried and true basics still exist, but you have to do it better than you did before and better than others. The long-term traveler is more sophisticated and their level of scrutiny is higher than ever. You have to constantly get a day better, not a day older. We’ve created something called the “AKA Way” so all nine AKA properties can communicate with each other. If one of our head housekeepers develops a tool to better tuck in the sheets, we share that with all the other housekeeping leaders.
The strong demand for good cell phone service really shifted a couple of years ago. Guests don’t want to be charged for using a hotel phone. They want to use their mobile phone and that’s all they want.
If somebody is coming in for delivery they don’t want a phone in the kitchen to ring, they want their mobile phone to ring. They don’t want to use a key to open the door, they want an app. We’re creating an app that opens the guest door and controls the shades, lights, and music. When guests open the door, they can have the lights and temperature already preset to a certain level. We’ll be rolling it out in New York City, Beverly Hills, and Philadelphia.
Skift: It sounds like technology plays a really important part. How do you balance front-end and back-end systems?
Korman: The difference depends on the length of stay. If someone is gone in two days then they might be wowed by sleek design or Ian Schrager doing crazy stuff. If they’re gone for two weeks or two months then they expect to have a printer at the desk, good lighting for work, and 50-100 MHz for bandwidth. They expect certain things that they have at their home.
They expect a good place to work out. I can miss two days of working out, but I can’t miss two months of working out. They expect to live as good as they do at home, if not better, and technology is an important ingredient. They want to be able to advantage of what the city has to offer.
All these expectations are at a higher level based on the length of stay. They want the value and spaciousness, but beyond that is an expectation to be able to live in a way that they live at home. They need it, rely on it.
Skift: What role does hiring play in improving the guest experience? Have you changed your hiring strategy in order to improve the guess experience?
Korman: Absolutely. For the most part, we do not hire anybody from the apartment or hotel industry, from traditional hotel management. We will hire from hotel sales or food and beverage. Their attitude determines their aptitude, so to speak. In today’s world, you need to surround yourself with people who are neat, presentable, and clean. The way they carry themselves and their personal hygiene is very important, but even above that is being friendly.
They need to be able to look a person in the eye and respect somebody’s privacy and being there when needed is very important. I find people from the food and beverage industry work very, very hard. They work holidays, weekends, nights, and they’re on their feet.
We have internship programs with some of the leading colleges, hospitality colleges in which we’ll bring in some of those people early on. It’s a win-win. We don’t want somebody in that overall industry who doesn’t know that we’re a niche within that to have preconceived notion of what furnished apartments do.
Everything we do at AKA is outside the box so I want open mindedness and you find that in different industries outside of our industry. I would say at each property, each general manager, assistant manager, and maintenance manager has come from different areas. For sales, it’s usually someone in outside sales who understands how to create their own traffic and not rely on a traditional third-party booking system. The hotel industry is just waiting for bookings to come and they’re at an absorbent fee.
Skift: Does the staff interact less or more with guests during an extended stay?
Korman: It depends. At one of our properties, guests check in with a general manager instead of a front desk. That general manager might only have two or three check-ins per day since the average length of stay is two weeks. It can be five minute check-in process where the guest is sitting down, not standing. We find out what doctors they need, which newspaper they want delivered, or which activities they’d like to do.
From day two to day 89, guests will go to the front desk, which is the resident service desk. They can schedule dinner reservations or show tickets. We don’t have a concierge because that becomes very jaded. Guests associate with that individual profiting. We have three dimensions to resident services: Our on-site resident service team, our selection of outside service providers, and recommendations of apps to get them through the city and truly live like a local.
Skift: What is your customer base and has it changed over time?
Korman: It’s more global than traditional extended-stay or five star hotels. When Americans travel, they say, “I have five days to go here and I want to stay at the Four Seasons.” They know where they want to stay and there’s a comfort level in the name brand. When someone is traveling from Europe or South America, they don’t want to stay in a Four Seasons or a Marriott. They want to live like the locals, to holiday for a month.
They want to really get to know the culture and the people so they’re looking for something in a tree lined residential neighborhood where they can stay for a month, feel like it’s their own residence, shop in the local stores, get to meet people, and really interact and get to know the culture of the neighborhood at all of AKA’s locations.
We say we’re the world’s first elastic hotel. Part of that is in a focus on the length of stay and size, but it’s also about the individual. Elastic as an adjective because they appreciate design and value getting to know the culture of a community. They don’t want to just come in and out and stay at a brand name hotel.
They want to go to cool restaurants, go to the shopping districts outside Fifth Avenue, and experience the vibe of the city that they’re in. Our guests are traveling equally for business and leisure. We’ve found that people who are in for business want to enjoy the travel aspect and the people in for travel want to enjoy the business benefits.