Small hotels can do better without brand affiliation

A guest post by Joseph Fischer

A year ago, I wrote an article that was posted on the international portal:

www.4hoteliers.com . The title of my writing was:

„Can small hotels do without global brand affiliation?“

Nowadays, when almost every large global hotel group launches a ‚lifestyle – boutique‘ brands, ‚Limited Service design hotels‘ or offers special ‚Collections‘, A question comes to mind: what is the difference between what a local 4 star hotel is already doing for years and what the brands are now offering?

Here are some rather recent quotes I found that reflect the change lodging is experiencing in the last decade:

“Experience is mostly aimed at younger generations with more natural materials and fabrics. Food geared toward ‘grazing’ rather than dining, a greater emphasis on technology and common areas that offer guests a verity of pleases to congregate. Younger travelers seek out social environments more than their elders”

Mr. Bjorn Hanson, Global Hospitality Leader for PWC

“There is a lot of marketing hype surrounding the changing needs of different consumers. Markets come up with all sorts of fancy definitions about what Gen. Y or Millenials want. When the surface scratched, however, it seems younger guests want pretty similar things to other guests- a good night’s sleep in a comfortable bed and an effective shower. The main development in the past decade or so is that Wi-Fi is now as high on the list as the shower and the bed”

Hotel Analyst Perspective issue 23, November 2013

“People seek both to feel part of society, but at the same time, desire to feel special and unique, and the lifestyle sector has evolved to satisfy this need“.

Our children answer the definition of ‚Millenials‘.

Two kids in their early 20’s and a teenage daughter, what some of you refer to Gen X, Y and Z.

These kids have been around. Have seen the world and stayed in some great hotels. What they told me was that they loved the hotel. Not for the fancy facilities or the fantastic views from their hotel room windows.

What they loved was the interaction with the staff members, the friendliness of the staff members.

So, what do I make out of my own experiences?

It seems to me that if you are a small hotel, 30-50 even 70-100 keys hotel in a good resort or city location, offering great individual service you could probably do without being branded or affiliated to a brand – ‚collection‘.

What brands offer is that the new hotels will become part of the local environment, engaged in their local communities, create interactions between the guests and the locals. The lobbies will transform to social meeting places

That’s not new. Many of the small hotels in places like Sorrento, Rome, Berlin, Paris and Barcelona already have it for many years. It is part of the DNA of that small family owned and run hotels. These hotels do not look for any special title or definition. No special color or strange name that no one really fully understands. Here is a short list of these brands: RED, BLUE, MOXY, Canopy, Aloft, Quorvus Collection, Curio Collection, VIB by Best Western and the newest –WTF (Just joking with you!)

These are but a few examples of those strange names.

A year later, I have a better prespective on this dramatically changing market. If we look at big cities we see that across-the board, the individual „lifestyle“ hotels are doing better than their branded competitors: This data is difficult to obtain but if you take big OTA’s rates and classification as a benchmark.

Just look at hotels in Berlin: INDIGO by Inter-Continental compeered to individually run lifestyle hotels such as: Hotel Nhow, Ku Damm 101, 25Hours Hotel Bikini, Soho House or my friend’s hotel i31 .

All the individually run locally branded hotels are enjoying higher daily rates.

This situation is similar in London on a much larger scale: If again we compare INDIGO’s published rates and reviews in the OTA’s to rates archived by individually run lifestyle hotels such as: Ace Hotel Shoredich, Ham Yard Hotel, The Hoxton and The Levin. The result is that the individually branded and run hotels are showing better reviews and in most cases higher rates.

In a most recent great article titled: „Clichés, Customers & Creativity“ written by James Stuart from Brand Led Hospitality, Mr. Stuart writes: „Our business is dominated by large, publicly listed groups. A recent article in Harvard Business Review about the lack of innovation in sizeable corporations asserted that their CEO’s ‘hear about the advantage of ‘disruptive’ or ‘step-out’ innovation and decide that their organisation should do ‘some of that’. But their organisations are designed to do something else very well. Namely, what they are already doing’. To innovate is to take risk, and that is all too scary when the next quarterly earnings reports are just around the corner.

Yes, some of the large groups have brands with contemporary traits, yet, I don’t see Edition, or Canopy, or Indigo, or Moxy, or ‘Aloft’ as rule-breakers. They surely have done varyingly good jobs of reflecting the changing world we live in outside the boundaries of hospitality, but they are not cheese movers. Some conservatives herald them as pioneers because they seem different, but that means little in a sea of acquiescence.

Like many other industries the engine room of innovation is more often found in small, entrepreneurial groups who have less to risk. They have to be rule-breakers simply to survive and grow“.

Dear friends, Lets go back to basics, then; what any guest is looking for in a good hotel are these basic points:

  • Location – LLL
  • Price – Value Proposition
  • Personalized service throughout the hotel
  • Individually designed public areas and rooms
  • Basic Comforts (a good bed, a great shower, AC and Wi-Fi)
  • Great breakfast
  • Keeping to strict standards
  • Free connectivity Wi-Fi for all guests in all hotel areas
  • Full visibility on all major social media portals and sites (OTA’s, review sites, photo shearing)

Once all these points are FULLY and TRULY met, I see no reason for a small hotel not to succeed without being branded or affiliated and most probably for fewer expenses.  

Joseph Fischer is the owner of Vision Hospitality & Travel and a regular writer in International lodging portals.

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