Could you give us an idea of your brand values?
Freedom of choice to the customer is something that we give importance to. We feel that luxury is defined by freedom of choice. We see it as important to be customer led. Generally speaking this is our mantle.
Additionally, we like our individual hotel to be connected to their local community – they’re independent so they can also engage the guest in local experiences unlike a Hyatt or a Starwood, which are essentially international hotels with international style.
What are the criteria for you to accept a hotel as a member?
We don’t take any product blindly. Our product criteria is the basic – connect to outside community, be imaginative, offer choice to the customer on when and where and what to eat and a place to exercise and rejuvenate. There’s no ‘must haves’ as such, because we try and let them be individual. Like in Fiji they don’t have doors, so if I said you must have a doorman then I wouldn’t have any SLHWs in Fiji. What I can say for certain is that butler level service is key.
The thing is that it (each and every hotel’s style) may not be everyone’s cup of tea, but we’re looking at a segment of the market that looks for these experiences. The great thing is that we have mystery inspectors – these inspectors are frequent loyal guests and are all members of the club. They pay with their own credit card and we reimburse them later.
Could you give us an idea of your target market?
For hospitality members, our target market is the independent wealthy owner who wants to run his hotel and is looking to obtain a level playing field. He may want to build his hotel in a certain location that the chains aren’t interested in that location at that time. Among guests, our target is the guest who wants a local hotel.
What are the challenges of the Indian market?
The challenges of the Indian market are the same as in any other market. People continuously complain about the infrastructure being problematic, but this is not really a problem. It’s no different than the problem you have travelling in Africa and yet the international traveller loves going there and to the Far East, which also has similar problems. Can you expect to go on a safari by a motorbike or jet? If a traveller wants to experience something, he has to take the bumpy ride. Luckily the international, experiential traveller is accustomed to this. Indian metros have good connectivity between them anyway. My experience with Jet Airways was much better than some carriers in Europe.
Luxury is susceptible to the economic landscape. How did the recession impact you?
The luxury traveller was most certainly impacted by the recession. Average rates did drop. Our studies indicate that the wealthy guest does shop around, does want good value, and does want a discount, perhaps contrary to popular belief.
What travel trade efforts are you undertaking in India?
We’re starting with a representative office through representation company Aviareps and when business grows we’ll have our own office here. We have a travel agent website. Agents need to key in their number to get a 10 percent commission, sometimes more, depending on an individual hotel’s offer for them at the time. There is also a VIP desk where the travel agents can call for help.
Is there any special help in distribution considering India is still catching up with online booking?
We have a dedicated toll free number for India.
Which Indian locations do you feel must carry the SLHW flag?
I’d definitely like to have hotels in Delhi and Mumbai. India’s North and North East would be interesting for us. I’d love to have an SLHW anywhere in the midst of beautiful scenery. A property in the backwaters would be lovely and heritage properties would be good.
What trends are you noticing out of India?
There are a number of Indians booking for hotels in Finland, Hong Kong, Singapore, England, Germany, Estonia and Thailand – we have 17 hotels in Thailand. I foresee more boutique hotels in India and China. I don’t see the growth rate being maintained in Europe and US. I think that the India, China, Russia and South American markets will be interested in these hotels. Supply will not keep up with demand so the average rate will increase. The great thing about India is that you have a very strong domestic market and yet you have a great international market so you have double the potential. It is better to put your eggs in more than one basket considering that there is some global catastrophe almost every two years.
How has the growth of your member’s base been?
In Asia Pacific there is big growth in membership. When you look at the share of Asia there was only 3% contribution from Asia Pacific initially and now its contribution is at 20%. We also have a base of 200 hotels that have been with us for the last five years and show very good performance in terms of occupancy and ARRs.
Tell us about India specific growth.
We’ve seen a 145% growth into Indian properties. The growth in the number of Indians into other properties is at 129%.
Do you have any India specific targets or projections?
I’d like to push the outbound and inbound growth to 200% since until now we hadn not made any efforts and yet the growth was great. In fact I think the growth may turn out to be more but I would like to be cautiously optimistic. We have 13 members in India. I’m looking at another 10 by the end of the year. By 2015 I’m targeting 25-30.Â
How much does it cost to become a member of Small Luxury Hotels of the World?
It costs about 12.3 lakhs a year on an average for a 50 room hotel. The lowest is 9.4 lakhs for a 20 room hotel plus a joining fee of 10.8 lakhs
What are the benefits that you offer?
We market SLHW to customers. It puts our member hotels on a level playing field with the global chains. It also allows them to be marketed together with likeminded properties. The initial benefits offered were inclusion in the brochure which is in every SLHW hotel so you know the guest who views the brochure is within your target market. We also have a GDS code LX. About 60-65% of business comes from GDS. The challenge that we have is that the hotel has to work out a system where they know what inventory and rates are going on the GDS. Each hotel has an account manager that connects them to the outside world through SLHW. Today there are additional benefits as slh.com allows potential guests to access 20-25,000 photographs. The site gets traffic of about 10,000 visitors per day. We do our best to make our members as accessible as possible to potential guests. Currently, we are looking to make our website available on Android phones. It is already available on the i-phone. We also have the website in six languages.
We have a loyalty club which at 100,000 members currently of which 15,000 are really quite loyal. 40% of our SLHW club business is booked by club members.
What is the maximum size of a ‘small’ Luxury Hotel of the World?
It depends – In Bangkok; a 200-room hotel would be small. We don’t charge anything extra for more than 120-rooms but we don’t usually have hotels much larger than that.
