At a press event earlier this
year, Starwood President and CEO Steve Heyer said, "I have joked in
the past that a bottle of ketchup holds more desire and loyalty
than a 300-room hotel. There is something fundamentally wrong with
that."
It was one of those
statements that is both startling and true.
True, because I know
that I'm often motivated first by room rate and then by brand when
I look for a hotel. Startling, because you just don't expect the
head of a hotel chain to say something like that.
Nevertheless, the
issue of brand loyalty, long discussed in the hotel industry, shows
few signs of dying down. If anything, the discourse in many ways
has only begun.
Lalia Rach, associate
dean of New York University's Tisch Center for Travel and Tourism,
says it is one of the fundamental challenges facing the
industry.
"If you look at the
hotel industry, the question is, do they have the brand as the
focal point?" she said. "Have they clearly defined the brand not as
a place to lay your head but as an experience, a lifestyle, an
element in your success?"
In the past, she
said, "what they thought they were selling was location. OK, now
that you've done that, what is it that makes you unique? It comes
down to what your brand is about, and that's what the hotel
industry is struggling to define."
Any discussion of
brands inevitably turns to consumer brands that have been
successful in transcending, to some degree, the products to which
they are attached.
Rach cites Nike as an
example.
"What Nike has
smartly done is say, 'We are not a product.' They wanted to be far
more than tennis shoes."
Through the "Just Do
It" slogan and marketing campaign, she said, Nike has become "an
attitude, a lifestyle. But they are also saying that in order to
[just do it], you need our stuff. In essence that's what I think
hotels will have to do relative to lifestyle, relative to
experience, relative to your success as a business professional.
Establishing clearly the brand image and awareness in the
marketplace has to happen."
It could be argued
that hotel chains have little choice but to better define their
brands in the market if they want to avoid the fate of the
airlines.
"Technology has
accelerated the amount of information that arms consumers," said
Peter Warren, chairman of WarrenKremerPaino, a New York advertising
and consulting firm and a member of the executive advisory board of
the Tisch Center. "Guests have the ability to go online and find
the best rate. The transaction is very transparent."
Once rate is
eliminated from the equation, Warren said, what's left is the hotel
itself.
Through the Internet,
guests "can find out about previous guest experiences at the
hotel," he said. "There are chat rooms. There are blogs now. As we
know in marketing, word of mouth is very powerful. So now we are
not selling real estate or a room any more. It has gone beyond
that. It is no longer about location. You have a lot of hotels and
a very sophisticated clientele. We are now into the personality and
experience business."
And that essentially
places hotel brands in the same realm as other consumer brands,
such as Nike and Apple. In fact, that largely was the point Heyer
was making.
Several hotel brands
are already thinking along those lines.
Michael Deitemeyer,
president of Omni Hotels, which ranked highest among 13 upscale
national hotel brands in the J.D. Power and Associates 2006 North
America Hotel Guest Satisfaction Index Study, is so certain that
brands will be the new battleground for hotels that earlier this
year his chain did something unusual. It established what it calls
a Sensory Advisory Board.
Comprising
representatives of such well-known brands as Apple, Sirius
Satellite Radio, Elizabeth Arden Red Door Spas and Whole Foods
Markets as well as the Juilliard School, Benziger Family Winery and
Bon Appetit magazine, Omni is seeking the board's advice as it
continues to define and differentiate its brand in the
marketplace.
It is the kind of
thing Rach believes hotels should be doing.
"I would ask you
right now: How many brands are you wearing?" Rach said. "There are some areas of everyday
clothing that nobody sees but yourself. But yet, there are people
who will only buy certain brands. We are a brand society. It
infiltrates every aspect of our being."