I attended the 2017 edition of the ILTM Conference in Cannes. Over the course of the program, I sought out numerous hoteliers and hospitality experts to discover the latest emerging themes and challenges in the luxury hotel industry.
One theme that has fascinated me over the years is the subject of digital technology. It is a controversial term in the luxury hotel universe, which has traditionally centered around human touch and would thus ostensibly resist the digitalization of the unique service that defines luxury hospitality.
During the conference, I was eager to discover how different brands chose to approach the issue of digital technology. I was lucky to run into Frank Marrenbach, CEO of the Oetker Collection. He keyed me in on the latest digital technology strategies he envisioned in his hotels as well as new developments for the group abroad.
What is your vision of digital technology in terms of the guest experience?
I have one big idea: that I can talk to every single client in the most individualized way. Let’s say we have 100,000 guests; I’d like to have 100,000 dialogues. That’s utopia, I get it—that you receive the message and it’s really all about you, not about me, not about anyone else. I don’t believe too much in digitalization once the guest is on premises.
I think there are good possibilities. Take Jumby Bay Island, where you have an app. The app tells you everything about the island. It’s convenient, but I don’t want the app to get in the way between us and the guests. I really think that in this case, the human touch is very important. Everything before is ultimately important. We are not good enough at reaching out to all of our audiences in the best possible way. We do email them, but let’s face it, that approach is often a shortcoming. As a lifestyle company, we have to do this better. Luxury with a twinkle in the eye, luxury that is responsible—that’s really important, but we need to better understand when guests think about us. We need to get into their minds.
We have a lot to improve here. Digitalization is just a way of communicating. I want the human touch. Oetker Collection is a human-sized company, and we want to remain as such.
Do you have any developments in New York? What other developments would you like to see in the future?
Some people may remember that we had a good possibility in New York. We signed it, the owner sold the whole building at 550 Madison, but the new owner wanted to keep the whole building as an office building. So we are back on the street looking for new possibilities. That’s life. The Upper East Side is of course the location where we want to be. Surprise, surprise, we‘re not the only ones. We have to do a little bit of convincing. I think we’ll be there. New York is important for us, as is Los Angeles.
In Europe, we feel that Rome is an important location. So is Berlin, not just because we’re a Germany company, but because we feel that Berlin is quite a cool city. In some years from now, the Far East is attractive, but we’re simply too small at the moment to do it. We can’t go to China if we have 10 hotels. We would fail if we tried at this moment. We need to be a little bit cautious. We’re thinking of Tokyo, Singapore, Shanghai, Melbourne—the obvious ones. We are no smarter than other companies; we look around the world and see where people go, and where people go, we want to be there. Most of the time we can make a little difference. We have a little bit higher rates, but we cannot just create a destination where there is none.
Does the group have interest in seasonal hotels?
Are seasonal hotels interesting? Absolutely. If you see the smile on my face when I hand in the balance sheet, I can assure you there is not one single question whether this is a good thing to do. We’ve always wanted to offer a winter resort for our guests so that they can stay with us when they want to go skiing. Beyond that, I guess 2/3 of the team at L’Apogée Courchevel work in the summer at Hotel du Cap-Eden-Roc or Chateau Saint-Martin, which is ideal because we can employ them all year round. It’s clearly beneficial in terms of cost management. Seasonal properties are great. Just don’t keep seasonal properties open when there is no season.
Are you seeking management contracts or ownership in your upcoming projects?
It depends because we can do both. Sometimes there are owners who don’t want to share. Take the Lanesburg; we would have loved to buy part of the Lanesburg, but the owner said, ‘No thank you. We want to own it outright.” Take Eden Roc St. Barths: we co-own. Individuality also means every single time we look at what’s good and what’s possible. Generally speaking, we like to be involved on the equity side. That’s a statement you would normally not hear from management company, but we create value on the equity side, too. Why not participate on the equity side if owners let us in terms of dividends? Sometimes owners want to sell in the later stages, so we would be ill-advised to ignore that and just say it’s management only. Let’s face it, you don’t get into a yacht with a risk-free management contract. That’s wishful thinking.
The good thing is that we have the means. The Oetker family just sold the shipping company for a substantial amount, so we have the liquidity, and they look at it in a multi-generational way. It’s not like they look at it just for a decade and leave again. That helps us out for co-investing if needed.
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Known for his international expertise on luxury hotels through his magazine, Laurent Delporte shares his vision and experiences in the world of hotels on his site DELPORTE Hospitality. He decodes the behind-the-scenes action in the sector: from food and beverage facilities, accommodations, architecture, to the quality of services. He offers interviews, advice, and articles as pragmatic resources that industry professionals and private individuals can refer to in their search for information.