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Worldwide Hospitality Forum 2010

Branding! Branding! Branding! Do Hotel brands have the ambition, the capacity, the legitimacy to develop a personal and binding relation with their customers and generate the same loyalty as users have developed in other fields (automobile, fragrance…) with their favourite brand? This was the main subject discussed at the Worldwide Hospitality Forum organized by MKG Group during the Equip'Hôtel trade show.

Mercedes Erra Executive President - EuroRSCG Worldwide

Few luxury brands have truly succeeded in meeting the challenge to expand their brand in the hotel industry. This is what we are trying to do with Hotel Missoni. The first hotel in Edinburgh is a real success. It is a fine translation of the attributes of the Missoni brand. Other developments are underway in emerging countries such as Kuwait and Brazil. Success is not a given, but the initial stages are positive. The evolution of this brand will be interesting to watch in the years to come”.A brand is not static data. It provides people with a service. It changes to fit the values anchored in their heads. If it stops providing this service, it goes forgotten. The desire for service is increasingly important because humans are becoming increasingly important during these times of worry and anguish. Quality of service is no longer judged the same way. The service must be human – accept mistakes - more than mechanical. The hotel industry clearly lacks the means if we compare this sector with other markets.Creating an advertisement for yogurt is fairly simple. I can explain the benefits of the product that the client will find on the shelves. But, inversely, service brands are complicated brands– thus interesting. Take the Monoprix campaign “je pense à vous tous les jours” (I think about you everyday). This proposal is becomes awkward if the cashier is in a bad mood. Meanwhile, Air France’s campaign “Making the sky the best place on earth” has taught us a great deal. At the time when the company was borderline bankrupt with repeat strikes, Jean-Cyrille Spinetta launched a competition. All the agencies were very wise in their projects, making few promises because they are difficult to keep. The president of Air France proved to be circumspect: “what you are proposing resembles my company. It’s hopeless. I want the most interesting promise on the market.” As the core business of Air France is business travel, our job was to turn the trip into a decompression gateway for stressed managers, who are always caught between two appointments. Those who are waiting to be ready are never ready. The “Making the sky the best place on earth” campaign was launched even before the company was put back on track. And it made it possible to improve the internal ambiance. Pride in service rose. Advertising is a strong indicator, externally and internally alike, that forces collaborators and clients to head in a direction.”Yann Caillère, Deputy CEO, in charge of Europe/Middle East/Africa, Sofitel Worldwide, Design and ConstructionWith exception to Ibis, which is well positioned, there was a big difference between the promise and the reality in our hotels. The Novotel brand was stronger than the hotel product. We have undertaken the intense job of renovation with a major financial investment. At the same time, we launched an advertising campaign that was original. We entered a field where we were unexpected by banking on emotion, design, and of course price (Editor’s note: the Design for Natural Living campaign used wild animals in a design setting). While we harbored some doubt, customer tests were very positive. Today, we have caught up in terms of RevPAR. And this summer, we were able to see the strength of this brand that is very appreciated by families. Upon the integration of Suite Hôtel in the Novotel universe with the launch of SuiteNovotel, demand from families exploded at these properties.In the upmarket hotel industry, there are two big families: North American with Four Seasons, Ritz-Carlton, Hyatt and Asian with Mandarin Oriental and Peninsula. The European family has been poorly represented since the demise of Ciga and Forte. And yet, 80% of general managers are European. We had to get there by claiming this European essence and, above all, French, because just three countries have any legitimacy on the luxury segment: France, Italy and the United Kingdom. Within the repositioning of Sofitel, we turned to artists and architects close to France such as Pierre-Yves Rochon, Jean Nouvel for our next hotel in Vienna or even Kenzo in Mauritius for a luxurious property made up of suites with private swimming pools. At first, we had 206 Sofitels and we cleaned the network so we have a hundred or so properties today. Accor’s DNA predisposes it to building the economy and midscale hotel industry, while the upscale segment is very different. In the economy hotel segment, we learn to economize. Each centime counts. In the upscale, you must learn to spend. Knowing how to spend 1,000 to earn 4,000. This is why we created a specific division by bringing in people from outside”.Hubert Joly, President - Carlson Group and Carlson HotelsIt is impossible to understand a hotel brand if we forget its B2B dimension in addition to its B2C orientation. It speaks to clients, collaborators as well as owners and operators all at the same time. The brand brings owners and operators a series of services for its conception, distribution, marketing. In terms of B2C, the emergence of brands is a relatively recent fact because in Europe, the vast majority of hotels are independent. But today we are able to observe an increasingly sophisticated segmentation. The positioning of brands is increasingly marked and defined by the level of prices. In the hotel industry the brand says more and more about who I am depending on whether I walk out of a Novotel, a Radisson or a Mondrian. Defining the brand’s values, its positioning, and whom it addresses is an imperative.The hotel industry is poor in terms of marketing and communications. The amount of investments is low with marketing fees that represent just a small % of properties’ revenues. Our budgets amount to some tens of millions of euros while in other sectors, budgets are in hundreds of millions with percentages closer to 20/30%. Are we headed toward an increase in marketing and communications budgets? Today, discussions are well advanced in certain countries where owners are very receptive to the idea of attributing additional funds.The Radisson brand is an interesting marketing case study. In Europe, it is a very nice upscale and upper upscale brand, while in the United States, the dynamic is very different. It is positioned on the upscale segment. Its portfolio is delicate because two errors were made in its development: it was based on franchising with no well-defined standards. We want to have uniform positioning worldwide with Radisson Blu hotels all over Europe and Radisson hotels in the United States and Asia that will have the same personality as Radisson Blu. The brand will be shifted upscale thanks to an investment of 1 to 1.5 billion dollars and the development of flagships in major American cities that will position the brand at a certain level. Today, 77% of owners have undertaken the renovation of their properties and 500 million dollars have already been invested. This rise in range in the United States should allow profit growth in Europe, because –for now– Radisson Blu hotels are not capturing the American travelers who have a distorted image of the brand. It just may, moreover, also make it possible to attract Asian clientele.

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