What strategies is your hotel utilizing to avoid being placed in brand relevance checkmate by the competition?
The luxury hotel segment is becoming a very crowded and competitive place to do business in the 21st century. The battle for gaining customer relevance, preference and loyalty will not solely be won by the hotel’s luxury offerings, location, or best price. Eventually the luxury hotel segment is going to come to this realization that they are either going to run out of luxury amenities to buy for their business, or the money to buy them with, and are going to have to compete on the total guest experience of the business for winning the customer loyalty and brand relevance chess match.
In an article I wrote earlier this year, titled How Is Luxury Defined By The 21st Century Traveler, I talk about how luxury is being perceived and valued by the 21st century traveler. I’d like to expand on the 21st century traveler perspective by showcasing a customer experience business strategy approach that can help the luxury hotel segment differentiate themselves and build a sustainable competitive advantage over their competition.
Who will win the chess match for customer loyalty in the 21st century?
I see more and more luxury hotel brands looking for new ways to differentiate or gain a competitive advantage over the competition, with a lot of emphasis and investment being made on the physical elements and amenities of their business, without first considering non-tangibles aspects of their business for better influencing those business decisions.
So, what will differentiate your luxury hotel identity and offerings over the crowded field of luxury hotel providers? I believe it’s the business’s ability to first make the guests feel good about themselves from their experience with the business, before the business attempts to make the guest/traveler feel good about the business itself. What can help support this approach is having a hospitality experiential value understanding of the customer/guest experience narrative and theme of the business’s brand. Let me share an example of what I mean when talking about experiential hospitality value, from one of my favorite luxury hotel groups out of New York in Manhattan called the Library Hotel Collection.
The David versus Goliath chess match
The Library Hotel Collection started their first year of operations in 2000, only to find themselves a year later in the heart of the 9/11 recession, which you would think a startup hotel one year in would be in serious trouble, but that was not the case. You see the Library leadership built their entire business on customer experience business platform with a hospitality experiential value mindset. The value proposition was built on providing a total hospitality experience, not a commodity position of being a hotel providing room in a good location, at a competitive price.
The leadership decided to utilize a narrative and theme to build hotel brand experience on with different educational identities for each floor, i.e. science, math, history etc. each floor has a different educational identity and feel to it, along with the rooms experience design. Each room has a little library section that plays on the theme, and the overall narrative of the floor, as well as aligning to the overall hotel brand experience.
Because this hotel group utilizes a nontraditional business platform approach that was more focused on experience and its people as their value proposition, this has allowed them the luxury of creating an outstanding service excellence program to support the brand experience narrative and deliver a much more personalized and memorable guest stay through the filter of a customer/guest experience initiatives for supporting the hospitality experiential value.
This business strategy approach was attached to all the other business disciplines as well, from HR to marketing for impacting the organizational culture and the brand dynamics of the business. This also allows the company strong accountability mechanisms throughout the hospitality enterprise for delivering the brand promise, message and values to everyone that comes in contact with the business.
King to Queen, checkmate!
They were able to differentiate themselves in the marketplace, and by doing so this little boutique hotel has been able to compete with all the major five-star ultra luxury hotel brands in Manhattan, in one of the most competitive hotel core doors in the world, during one of the most challenging 14 year span in the hotel industry history. They have full control of their ADR and don’t rely on the ebbs and flows of society, or business in the marketplace.
This strategic approach has also positively impacted occupancy levels that far exceed their competitors, as well as increase the relevance factor of the brand and locations of their hotels. They walk to their own beat, and have quite easily been able to stand out in the crowded field of luxury hospitality providers. This strategic approach has obviously elevated their online relevant factor for enhancing the search and pre-booking phase of the traveler’s decision-making processes.
The Library Hotel Collection is always in the top five hotels on Trip Advisor, with some of the highest rankings and ratings positions in the New York market, as well as in the virtual travel world. The guest loyalty towards the brand is so much like what you might find with leading national luxury brands like Apple or Nordstrom’s. They are considered one of the top five boutique groups in the country, if not the world, all within a 14-year span, in which they have grown and diversified into six hotel properties, with more on the way. The Library Hotel brand’s ability to connect their luxury amenities, services offerings and people with the theme and narrative of the guest and brand experience has generated a very sustainable competitive advantage that can’t be easily mimicked, procured or duplicated by the competition.
In summarizing the Library Hotel Collections’ strategic approach The leadership got crystal-clear on what they wanted to be great at and the value proposition offering, as well as brand dynamics of the business to be in alignment with their core foundational principles of the business. They also utilized the guest experience perspective throughout each and every discipline within the business for creating a strong service excellence culture that supports the quality consistency of the experience their delivering to the guest.
Now, for those of you who don’t want to completely renovate your entire hotel or brand, here are a couple of tips to help create a stronger hospitality narrative and brand experience to break through the checkmate scenarios your brand might be experiencing.
- Find an aspect that you think your business can be great at, as hospitality enterprise, and also would engage the guest or travelers you would want to market to. It must generate strong relevance and differentiating qualities in the marketplace.
- Build out the narrative and theme to be in alignment with that value proposition offering of your business, So that your business and organization has the ability to conceptualize hospitality experiential value in the guest experience. I.e. move away from the commodity position of just offering around and shift the value proposition towards competing on an experience offering.
- Having a guest experience strategies immersed into every single business discipline in the hospitality enterprise, as well as in the service excellence program, for better supporting the organizational culture that is responsible and being held accountable for fostering the guest experience narrative.
The perception of value for influencing preference is being measured by the total experience the guest receives from the business, not just the commodity-based position, price or location etc. of the business. Luxury is going to be defined by the total experience the guest receives and the care in which it’s delivered. In the 21st century travel consumers are more informed and focused on the total experience their receiving, and are also quantifying and qualifying the value in that total experience.
About the author
Brett Patten is approaching 35 years in the hospitality industry where he has spent those years accumulating invaluable experience in a variety of leadership positions, and business enterprises. Brett has becoming known as one of the top executive leadership and organizational engagement coach on the subject hospitality intelligence, and customer experience design. Brett is also a feature writer for global hospitality, a national and international publication on the subject customer experience design.
Brett’s unique management and business approach consistently transformed hospitality enterprises with sustainable growth results from his days with the prestigious four and five-star hotel brands, such as the Stouffer’s hotels, Pan Pacific Hotels, and Le Meridien hotels, as well as working with prestigious five-star club resort enterprises like the very prestigious Longboat Key to the launching of a nationally award-winning hospitality brand in 2007.
Brett then turned this business processes into a company called “Five-Star Customer Experience Design.” Today, after spending the last 15 years researching, studying and developing customer experience design strategies for the hospitality and tourism industries, he has become an industry pioneer and the foremost authority on the subject of Hospitality Intelligence. Brett’s company engages with some of the top hotel brands and hospitality groups both nationally and internationally in the industry.