NEWH - November 2003 - (Page 33)

boutique chain – is it an oxymoron? by: Chip Conley Joie de Vivre Hospitality Until five years ago, independent boutique hotels were flying under the radar screen of the giant chains of the American hotel industry. Representing just 1% of the country’s hotel rooms, but 3% of the total revenue, boutique hotels were perceived as attracting a tiny upscale, urbane sliver of the traveling public. Yet, a number of factors during the last few years have conspired to accelerate the boutiques rush to mainstream appeal. The Internet has leveled the playing field thus increasing independent hotels’ visibility with travelers. The new democracy in design (that found Gap, Ikea, Target, and Pottery Barn bringing style to the masses) favors the stylish new, boutiques. And, finally, as with any product life cycle, as consumers became more familiar with traveling during the past two decades, the reliance on hotels that are consistent and predictable (read: chains) becomes less important. While an American executive might still seek out a Sheraton when she travels to Copenhagen, her growing experience with American travel gave her the confidence to seek out more unique hotels when she travels to other American cities. It took nearly 10 years, but the top execs from Marriott, Hilton, and their big chain brethren began hearing from their hotel general managers in the mid-90’s that these boutiques were starting to siphon-off some of their traditional business travelers. Yet, it wasn’t until Starwood CEO Barry Sternlicht began talking about the W brand that the chains actually starting strategically responding to this new competition. Barry certainly had his naysayers who said you couldn’t package and replicate a boutique hotel. But, trusting his gut and using his own “I am the market” tastes, Barry focused on the key ingredients that make a boutique successful: (1) locating in cosmopolitan urban markets; (2) creating a product that’s personality is a mirror for its customers (W is stylish, clever, and modern and these words match the aspirations of its customers); (3) creating guest rooms that address the current day functional and pampering needs of travelers (making sure the rooms are wired, have great beds and linens, a luxurious shower, but no armoire or undetachable closet hangers); (4) leveraging relationships with other complimentary brands that help to position W (for example, W has just announced a partnership with Kenneth Cole to create all W employee uniforms); and (5) making sure the product has a local flavor and doesn’t feel cookie cutter (he did this by picking local restaurateurs and artists to create his W’s in each metropolitan area). He broke many of the rules that some used to define boutique hotels. Many said that boutiques had to be small (less than 300 rooms), but W proved that it’s not the size that matters but instead the amount of personality. Others said that boutiques are trendy, the clientele will be fickle, and W will have to redecorate its lobbies every three years just to keep the attention of this niche of guests. That kind of “hotel as nightclub” logic doesn’t acknowledge the fact that a regular guest to the W San Francisco may only visit the hotel three or four times a year so he’s less likely to become tired of the product like he might feel about the hot restaurant or bar in his own backyard. W succeeded because Barry and his team sidestepped some of the key risks: (1) using the “one size fits all” mentality that chains typically use for replicating a new brand; (2) playing it safe to appeal to the perceived mainstream tastes; (3) focusing more on the exterior architecture than on the experience that is occurring inside the walls (a boutique needs to feel soulful inside, not just narcissistic); (4) using fabrics that are indestructible but mundane as opposed to sensual and natural; and (5) being satisfied with a bland food & beverage operation that doesn’t excite the locals. Quickly, W became the most profitable brand in the Starwood portfolio. Soon it became apparent to the conservative hotel establishment that Barry was on to something: that the vast and growing younger segment of the business travel population that was more experience-driven. W provided the vehicle capable of capitalizing on business traveler’s demand for a distinctive four-star hotel product that was both functional and stylish. 33

Table of Contents for the Digital Edition of NEWH - November 2003

NEWH - November 2003
Letter From the Editor
Hospitality News
On the Road Again... IHM&RS Show
Tips on Specs... Guestroom Lighting
Spotlight on the UK
Spotlight on Greater New York
Random Thoughts... Designing Today’s Boutique
Boutique Chain – Is It an Oxymoron?
Developing Boutique Hotels in Historic Structures
Unique Boutiques... The Story of Watertown
Approaching the Design of a Boutique Hotel
What Sets a Boutique Apart from the Rest?
Simplifying CEU’s
Small Business Advice
Industry Partner Education
Sources & Credits

NEWH - November 2003