With all of the consolidation among big corporate hospitality brands today, the smaller luxury hotel flags see a competitive advantage based on their smaller room counts.
That’s how Kapil Chopra, president of Oberoi Hotels, and Deepak Ohri, CEO of Lebua Hotels, are positioning their brands’ unique value proposition in 2016. Chopra and Ohri both say that personalization and customized experiences are the primary guest expectations in hospitality these days, driven by Millennial travel demands and behaviors.
“We are looking at Millennials in a very different way because they look at hotels in a very different way,” Chopra told Skift. “So we have to be enablers. The quality of the experience is extremely important because they’re much more well-read and they’re very aware and fully conscious of their travel strategy.”
Therefore, both hotel executives suggest, boutique luxury brands are more capable of offering a less homogenized hotel experience because they can integrate new service philosophies and hotel product updates at each individual hotel more quickly. This isn’t a new sentiment exactly, but we wanted to see how that’s evolving in 2016.
“Luxury is not about just service anymore, but creating exceptional experiences and memories for our guests,” Chopra said.
That’s true, we told Chopra, except everyone in luxury hospitality is saying that. Everyone. So how does a brand differentiate itself?
“Everybody is saying that, of course, but I’m not sure a lot of them are doing it,” Chopra responded. “That’s important to understand, because to deliver an exceptional quality of service, you need to have some level of control on the entire service experience across the brand.”
Presently, Oberoi owns about 70% of its 20 hotels in six countries, although moving forward the chain is shifting toward a more asset-light strategy. New hotel developments are presently underway in India, Morocco, and Dubai.
Chopra points to Peninsula Hotels and Mandarin Oriental Hotels specifically as other hospitality groups that offer an experiential luxury delivery based on their size and commitment to service. He said, “We are India’s most profitable hotel company, so we have delivered the returns, but I think that’s really because of the service excellence.”
Six months ago, Oberoi Hotels initiated a new “Empower” program that gives every employee $25 daily worth of food, beverage, or amenity credit to give to guests however they deem fit, without any questions asked. Originally, some Oberoi executives were concerned that the program might be abused in some way, but Chopra said the proof is in the numbers.
“That took my net promoter score (NPS) from 81 to over 86,” said Chopra. “So, how do you promote service excellence, and how do you make every employee a brand ambassador of the hotel? Owning 70% makes it very easy to drive our culture and a genuine sense to serve, because at the end of the day, how many hotels can you really keep on running?”
We asked Chopra why he thinks Empower helped drive higher customer satisfaction and referral scores.
“The reality in life is once you empower people and given them responsibility and start trusting them, then the majority of people will embrace it,” he said. “And we’ve seen that.”
Personalizing Online & Offline Experiences
At Lebua Hotels, which operates just a handful of properties in India, Thailand, and New Zealand, Ohri says there’s a new focus on creating individualized hotel experiences due to the influx of Generation Y travelers.
“Millennials have completely changed everything,” he said. “And once they started talking about experiences, the Generation X and Baby Boomers said they want the same thing. So now luxury has changed. The whole world has changed.”
This winter, “The Flute A Perrier Jouët Bar” opened on the roof of the Lebua at State Tower hotel in Bangkok, next to the iconic Skybar made famous in “The Hangover 2.” The new champagne bar was designed to provide a luxury counterpoint to the more casual Skybar.
Perrier Jouët created a signature champagne specifically for The Flute, with glasses of champagne at the low end priced over $50, and Ohri said the hotel is now serving more champagne than anywhere else in the country.
“For our guests, luxury is no longer about spending money,” he explained. “It’s about experiences. If something is a high price, it’s expensive. If it’s a unique experience, it’s luxury.”
To share those types of luxury experiences better with consumers online, both Lebua and Oberoi are investing in their digital platforms.
Lebua is heavily building its brand around food and beverage, and to drive engagement, the hotel group has an active blog to develop storytelling around special events and new menu items.
Ohri told us, “This is where smaller size is an advantage, to be able to communicate what’s going on at the local level.”
At Oberoi Hotels, the company plucked some of the leading digital innovators for Asia’s online booking ecosystem to drive innovation at OberoiHotels.com.
“We were very far away from what the online travel agencies (OTAs) were doing, who do such a good job engaging with people online,” said Chopra. “So we hired the VP of marketing from Yatra.com, one of India’s largest OTAs, and the chief marketing officer of the e-commerce company Myntra.”
The goal, he says, is to increase direct bookings by 30%.
“We are building the most comprehensive digital platform possible, so people can not only book but also engage in a very meaningful way, which also means online restaurant reservations,” Chopra explained. “When you can book your room and a table in less than 30 seconds, that’s leading the future of our digital strategy.”
We asked Ohri what keeps him up at night regarding the future of digital strategy in hospitality.
“I think the future is changing very fast, so are we asking the right questions?” Ohri responded. “People are becoming much more knowledgeable and adventurous, so it’s no longer about us always being the experts, because the guests know so much. Therefore, I would say that the main thing about engaging the customer in the future is all about the delivery. Delivery is key. And digital distribution as well, because everything is going online.”