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Lodging 2013 Hotel Survey

Four Seasons, Kimpton Triumph as Buyer Satisfaction with Upper-Tier Brands Dips

By Michael B. Baker / October 15, 2013 / Contact Reporter
Business Travel News on X

Four Seasons this year returned to the top of the 2013 Hotel Chain Survey's luxury tier, while boutique chain Kimpton Hotels & Restaurants bested numerous brands with much wider distribution to become travel buyer respondents' highest-rated upper upscale brand.

[Please click here to view the digital edition of the 2013 Hotel Chain Survey, featuring all rankings and downloadable as a pdf.]

As buyers face increased demand and very little U.S. hotel development in the upper tiers, Four Seasons also was one of the few to buck the trend of decreasing scores in the luxury tier. It held its score steady from 2012, which propelled it to the top of the rankings. Last year's top luxury brands, Starwood Hotels & Resorts' St. Regis and Luxury Collection, slipped to seventh in the tier.

Besides Four Seasons, only two other luxury brands did not experience a drop in overall score compared with last year: JW Marriott, which also held its score steady, and Fairmont Hotels & Resorts, which slightly improved. Several other brands also were new to the list and thus did not have year-over-year comparisons: Loews and Sofitel, returning to the survey for the first time since 2010; Shangri-La, Conrad and Peninsula, each of which has not been on the survey for about a decade; and Grand Hyatt and the Trump Hotel Collection, both making their chain survey debuts. Brands appear in the survey only if they are used by a sufficient percentage of respondents.

In addition to giving Four Seasons the top overall score, a position it has held for all but two years in the chain survey since 2006, buyers also rated it highest in all but three of the survey's criteria. Business travelers are Four Seasons' "most frequent and most demanding guests," according to Four Seasons vice president of corporate and travel industry sales in the Americas Don Jones, and the brand's performance, even in the age of budget belt-tightening, stems from its experience tailoring service to them. Though memories of the stigma of luxury travel from the 2008 economic downturn are fresh, those brands seek to counter the idea that luxury service and amenities are frivolous expenses.

"Luxury became synonymous with the unnecessary, but the value of Four Seasons is that we provide essentials," Jones said. "What's essential to business travelers today is what allows them maximum productivity."

Having listened to Four Seasons' corporate customers, mostly executives, speak at a recent forum, Jones said he was struck at how busy most were, to the point that even standing in a line was an intolerable waste of time. As such, recent service innovations include such time-savers as check-in from cars via an app and offering room service orders to go for flights, he said.

Bjorn Hanson, divisional dean for New York University's Tisch Center for Hospitality, Tourism and Sports Management, noted that such services also are examples of how luxury properties are adapting to appeal to the Millennial traveler.

"A challenge to the luxury industry has been how to seem welcoming for travelers with a different view of luxury and convenience," he said. "If a traveler is wearing shorts, a T-shirt and athletic shoes, the experience of entering among the mahogany wall paneling won't have the same satisfaction."

Four Seasons earned a healthy premium over its competitors in its score for consistency, which Jones said was one of its core strengths. That also applies to group travel arrangement and facilities, areas in which Four Seasons also was top-rated in the survey.

"Companies today, especially in the meetings and incentive space, are very risk-averse," Jones said. "Think about all that can go wrong that can jeopardize the outcome: problems with the A/V when the CEO is presenting, lunch isn't served correctly, poor food quality or lighting or an environment that's not right. That's where we can deliver the strongest product, consistently, to eliminate that risk."

Among the other top brands in the tier, Shangri-La, a Hong Kong-based luxury brand with a large presence in Asia but no U.S. properties, received top marks for its in-room business amenities and was ranked second overall. Buyers named Marriott's Ritz-Carlton brand, ranked third, for best service and overall value.

Kimpton's Ascent

In the upper upscale tier, the 60-property Kimpton chain also earned top scores across all but two criteria in the survey in only its second appearance, having last appeared in 2010. As with last year's top upper upscale brand—Starwood's W Hotels, which slipped to eighth this year—the results showed that budding boutique brands continue to win favor with buyers.

"What's interesting is the hotels with the largest networks aren't necessarily the strongest," said Henry Harteveldt, a travel industry consultant and partner at Hudson Crossing. "Kimpton is very localized and takes a high degree of pride in the personalization of the service it can deliver to a guest."

While Kimpton might not be as immediately associated with business travel as such legacy upper upscale brands as Hilton or Marriott, the brand's senior vice president of sales and catering, Christine Lawson, said corporate travel is Kimpton's "bread-and-butter business" and that the brand continually is making new inroads with corporate travel buyers.

"As we've added more hotels and more cities to our portfolio, we've become a trusted brand with them and their travelers," Lawson said. "It's enabled us to show what we're made of: not just the design and uniqueness of our hotels, but our Wi-Fi capabilities, being sensitive to what's going on from a health and fitness perspective and our lobbies and our social space."

As many upper-tier hotels now are doing, Kimpton has evolved its business center and lobbies to reflect more of a "coffeehouse mentality," with communal spaces rather than set-apart areas with computers and printers, Lawson explained. On the fitness side, the brand has added such touches as public bicycle programs and yoga mats in all guest rooms, she added.

InterContinental Hotels & Resorts and Hyatt Hotels and Resorts tied for the second-highest overall rating in the upper upscale tier, improving upon respective third- and fourth-place finishes in 2012. Hyatt also had the top score for meetings facilities and tied with Marriott Hotels & Resorts for the top data quality.

All three of those brands, however, were among those with year-over-year drops in overall scores in the survey. A few brands in the tier improved their scores from last year, including Wyndham, Omni and Sheraton, which recently had billions of dollars of investment in renovation for its portfolio. Besides Kimpton, brands returning to the survey this year included Starwood's Le Meridien and Millennium, each of which have had appearances in past years but not in 2012, and Carlson Rezidor's Radisson Blu brand, which this year for the first time was scored as a separate brand.

Negotiations for corporate programs in both the upper upscale and luxury tiers should prove more difficult for buyers this year, particularly in the United States. Demand in each of those tiers increased by 1.6 percent year over year during the first seven months of the year, according to Smith Travel Research, while upper upscale supply was up by only 0.3 percent and luxury supply decreased by 0.1 percent. Upper upscale demand, in fact, hit its highest monthly level ever in July, STR reported, and upper upscale hotels during the first seven months of 2013 were more than 80 percent occupied for more than one-third of the time. The firm projects average daily rates in the luxury tier will increase year over year by 5.4 percent this year and again in 2014, and in the upper upscale tier, STR expects an increase of 4.2 percent this year and 4.6 percent next year.

Hotel brands in the luxury tier increasingly are looking at expansion opportunities in the Asia/Pacific region and other areas as opposed to the United States. Recent and upcoming openings for Four Seasons, for example, include St. Petersburg and Moscow in Russia, Shenzhen in China and a renovation and takeover of the Hotel Westcliff in Johannesburg, though it also has a new Orlando property opening next year, Jones said.

Kimpton, on the other hand, has several U.S. openings planned during the next few years, including properties in Austin, Milwaukee, San Antonio, Palm Springs and Pittsburgh, Lawson said.

"Not only are we growing in key markets but also in secondary and tertiary markets that have a lot of opportunities to meet the needs of corporate and meeting clients," she said. "International is definitely on the radar, but we still have a lot to do at home."

This report originally appeared in the Oct. 14, 2013, edition of Business Travel News.

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