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Interview with David Kong President & CEO Best Western Hotels & Resorts: "I think the hospitality industry has gone through an amazing change over the last five years"

David Kong is an industry leader with a long track record of success. Since being named President & CEO of Best Western Hotels & Resorts in 2004, he has led the company to significant financial achievements including an average RevPAR index of 110 over the past five years as well as unprecedented performance in guest loyalty and hotel satisfaction. Best Western has a global network of 4,100 hotels in more than 100 countries and territories worldwide, with annual hotel revenue of almost $8 billion.

What are Best Western’s DNA and values? How do you manage to implement it in independent hotel partners?

Best Western was founded about 72 years ago and our founder at that time created what is called a referral network meaning hotels refer business to others. So as such from the very beginning we created this company like a big family because people referred business to one another… they became friendly… they shared best practices to help one another out. And that sense of family continues today. It doesn’t matter where you go for your meetings: it can be France, Germany or the United States. That sense of family is still very much intact. It is part of our DNA. Members helping our members is one of the founding values. The other one is as a referral network we have to be sure of the quality of all our hotels because we are referring business to one another so everyone’s quality must be at a certain level. And until today, treating guests like family and a commitment to quality continue to be part of our DNA.

You recently launched new brands for your hotel partners, could you explain us your brand strategy?

Yes, we have to understand that customers are not homogeneous; they are not the same. There are many different travel occasions. Some people are traveling on business. Some are in Asia. Some stay one night some stay multiple nights. Some want an upscale experience, some want a good value, so recognizing the different needs and wants, we created different brands that each cater to each one of these travel occasions. And if you think about Best Western today we have 13 different brands. We go from the economy segment all the way up to the upscale segment.  We also have traditional hotels, boutique hotels, extended stay hotels and soft brands.

How do you differentiate Sadie & Aiden from Glo & Vib?

All four of these brands are boutique hotels: Vib and Glo were created to be new construction upscale hotels. Vib is indeed upscale and Glo is in the upper midscale. We also created Sadie and Aiden. Sadie is an upscale brand but it is a conversion brand and so is Aiden aimed at conversion, and they are competing in the upper midscale segment.

What are the guidelines of your digital strategy?

Digital is very much the future and if you think about it, the reservations coming through the digital channels increases every single day. To the extent where the voice channel is almost irrelevant today. It is a very small part of our business now. And for that reason we no longer have a chief information officer, we have a chief digital officer. This is because we want to focus on our digital strategy. For a long time people have talked about customization. I believe in Mass Customization in the hotel industry because it makes it more affordable and cost efficient. Therefore, we use technology to facilitate our interaction at every single customer touchpoint: from the moment they plan to make a reservation to when they actually make the reservation to pre-arrival and then arrival at the hotel. Even at the hotel we want to communicate with them through digital channels in addition to personal contact and post departure and afterwards.

What steps have you implemented to ensure sustainable development and management of your hotels?

Sustainability is very important and we pay attention to sustainability and how we develop and manage. In development Best Western has always been known for being generous in our protection zone so we don’t take applications that will negatively impact our current Best Western hotels. That’s responsible growth. On the management side we also want to make sure we don’t impose onerous requirements that don’t have a return on investment. Our Board of Directors in respective countries are all made up of members themselves. They are hoteliers, so before imposing a requirement, they must first be convinced that the investment will have a nice return.

What are your development plans for Europe and worldwide? Do you have target figures for 2020-2025?

We have about 1,400 hotels in Europe and about 4,000 hotels around the world. When we look at Europe it’s pretty saturated for the most part in the major countries, but we still have   opportunities because of new brands that we’ve created to penetrate all these areas even more effectively. In Europe we are looking for growth of about 200 hotels every year going forward. In the rest of the world we think it will be close to 300, so we are looking at a total of 500 hotels each year.

How do you imagine that the hospitality business will evolve over the next few years? How will Best Western adapt?

I think the hospitality industry has gone through an amazing change over the last five years. Just think about all the different things we do today – it’s a dramatically different industry. I think we have to be prepared for even more change going forward. I’d like to make sure that our core competencies are absolutely at their highest level. Whether it’s loyalty program, digital strategy, customer relations management and so forth it is important that we do all these things really well. And that’s how we can protect our share of business today and branch out and grab shares from our competitors.

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