Push it forward

The precise identity of the hotel of the future may be difficult to predict, but operators cannot veer too far wrong if they pay attention to their customers – in terms of placing them at the heart of a hotel’s processes and making use of information provided by guests in refining their offerings.

For Michael Levie, founder and COO of citizenM, technology can have a role to play in elevating and improving a personal, human approach to making loyal customers feel rewarded. He explains that, at the desk, the screen displayed to the citizenM ambassador when a repeat customer checks in is a slightly lighter shade of the regulation grey. This is unlikely to be noticed by the guest, but provides a signal that allows the ambassador to personalise their greeting. “They could simply come back and say 'hey, welcome back, good to see you',” Levie says.

It’s a simple refinement but one which makes a big difference to the customer by displaying appreciation for their loyalty. “We sometimes try to be very sophisticated about everything,” Levie says. “Sometimes, it’s in the little details.”

Brand loyalty

Loyalty and the programmes that frame them have a huge part to play in this space; specifically, how loyal guests are to individual brands. Andrea Jones, senior vice-president of international development at Marriott, and her colleagues assumed the answer to that question was ‘not very’. The results of a questionnaire released by the operator after its acquisition of Starwood took them by surprise.“We thought there might be a 50% overlap,” explains Jones. Specifically, that a Starwood customer might also be part of the Marriott loyalty programme. In fact, the overlap was just over 11%.

What the data did indicate was that loyalty to a single brand among its customers was, in many cases, intense. “And what that really told us was that it was really important to get this right when we unified the programmes during the takeover," Jones says. Again, the Marriott team was caught napping by the scale of concern among its global customer base as to how the new arrangement would affect their loyalty benefits.

“We’ve got 120 million members, which, if you made that into a country and population, it would be just behind Mexico,” says Jones. Even after Marriott set up dedicated customer engagement centres to field customers’ calls and emails about the new plans, the operator was inundated. “We had to employ extra people, and pull people away from what they were doing around integration to answer their questions.”

When it came to understanding brand loyalty from the point of view of segmentation by age, occupation or travel needs, Marriott had done its homework. Jones makes it very clear that anyone who wanted to discuss precisely who the ‘customer of the future’ was had to provide documentation.

“I want proof,” she explains. “How are you really identifying that customer of the future? Is it through studies or talking to your customers after they’ve been with you? But that’s the customer of today, not necessarily the customer of the future.”

As Jones points out, Marriott has attempted to get around this problem by commissioning extensive research and data analysis – both internally and from outside sources – through the lens of brand segmentation.

“We would look at how our brands position, within key customer segments, what guests want to get out of travel, what they need while they’re travelling, and how well brands meet their expectations,” she says. “That enables us to understand what a new generation of travellers’ needs and wants will be.”

Fill white space

Crucially, this research helped Marriott identify what Jones refers to as ‘white space’ – those areas where no single brand is catering for a specific set of customer demands. Most of the time that leads the operator to tinker with their offerings around the edges. In one notable case, the creation of a whole new brand was deemed necessary.

“One of these external brand segmentation studies really identified massive white space in the affordable lifestyle space,” Jones says. “It was looking at a customer need for something edgy, cheekier, more fun. You don’t have to be – I’m going to use the ‘M’ word – a millennial to want that.”

This intensive period of research and analysis into customer loyalty led directly to the creation of the ‘Moxy’ brand to meet that customer need.

“It was the first brand that Marriott created, not bought, outside of the US,” says Jones. The new chain was created in Europe for European guests. It took a lot of persuading to convince the owner that the creation of a new brand was the right step to take.

“Mr Marriott is quite a conservative gentleman, and when we presented this idea – edgy, fun, risqué – he wasn’t awfully comfortable with it,” Jones says. Eventually, he was persuaded.

“It was all about the European customer, what they were looking for, and that customer of the future. And it was all this customer-centric data that convinced him to do it.”

This approach, which hones in on the specific details that a customer looks for in a city hotel and eschews outdated or extraneous features, is familiar to Levie, whose citizenM brand was pioneering in the ‘affordable lifestyle’ hotel space. A focus on modern and arresting design, flexible public areas, feature bars and the use of technology presents the hotels as representative of a lifestyle, not just a place to sleep.

“I think that it’s clear the brands are focusing and narrowing in on certain lifestyles or certain groups,” he says. “Because of that we see more relevance and we see a little bit more definition.”

This positioning of the hotel as the round-the-clock epicentre of a hip neighbourhood and the manifestation of an aspirational, adventurous lifestyle characterises a number of Accor’s acquisitions. The group has focused on investing in existing brands, such as the offbeat Mama Shelter – founded by, among others, Philippe Starck – and Jo & Joe, which caters for a range of travellers by offering private rooms, hostel-style dorms and apartments. This raises the question, however, of how these niche, lifestyle-focused hotels fit in alongside Accor’s more traditional offerings, such as Novotel.

Franck Gervais, Accor’s president of Europe, explains that the group is focusing on innovation – not just through investment in boutique offerings but in terms of updating their long-standing brands. “We try to work very fast and to modernise ourselves,” he says, pointing to the Canary Wharf Novotel, where the award-winning restaurant Bokan serves fashionable bottomless brunches.

Hilton’s approach is different, as EMEA president Simon Vincent outlines. “We're very much about growing our brands organically,” he says, pointing to the success of Tru by Hilton as an example. Hilton’s recent focus on targeting the customer of the future has been in the development of Motto, the recently announced micro hotel brand that provides compact rooms that can be connected for larger groups.

Vincent also highlights the role of customer research in the development of Motto, explaining that guest comments had led them to explore and develop this alternative to sharing and Airbnb-style accommodation.

“A lot of feedback coming from customers is that they love the concept, they love the accessibility, but people don't want to share,” he says. “There’s a degree of privacy that customers want.”

Driven by technology

The conversation returns to the role of technology, with Vincent pointing to its significance in the creation of hotel rooms that answer to current and future guest needs.

“It's going to be all technologydriven,” he says. “Smart-room technology and our connected-room technology, in terms of heating, lighting, and TV channels, everything is going to be driven out of the smartphone.”

The pervasive growth and success of technology companies can light a path for hoteliers looking to tap into the zeitgeist. Levie reveals how they provide inspiration for citizenM.

“Technology comes up a lot,” he says. “We're always saying we want to be sticky like Facebook and easy like Uber, you know? Try to log out of Facebook: it's impossible. It logs itself back in. And you know, we're all used to Uber because it's so easy.”

The challenge for hotels in occupying the lifestyle space of the future, perhaps, is to achieve this level of familiarity and accessibility.