Ted Teng, CEO, Leading Hotels of the World to create a new business model
The Leading Hotels of the World is one of the largest luxury hospitality collections worldwide with more than 430 hotels and resorts in more than 80 countries. The company was founded in 1928 with 38 member hotels across Europe, Egypt and Israel.
What started as a reservations service for independent hotels has evolved into a full-service organization that includes sales, marketing, financial services, and inspections. The company remains 100 percent owned by its members, putting it somewhere between a cooperative and company with services for hire.
Leading Hotels of the World and similar organizations, including Small Luxury Hotels, Preferred and Relais & Chateaux, differ from hotel chains like Marriott International, Four Seasons or Hilton Worldwide for a number of factors, including ownership models, pay structures, and branding.
These international chains, however, are now investing in independent hotel collections of their own, driven by consumer demand for more boutique, local hospitality experiences. Starwood launched the Luxury Collection in 1998 through its acquisition of Sheraton, Marriott launched the Autograph Collection in 2010, and Hilton Worldwide launched the Curio Collection in June 2014.
Ted Teng, CEO of Leading Hotels of the World, discusses the future of the luxury hotel industry in an interview which appeared first on Wealth-X
Q: How do you differentiate from other hospitality groups like Relais & Chateaux and Small Luxury Hotels?
Ted Teng: One of the biggest differentiators between The Leading Hotels of the World and the competition is the breadth of hotels that we have in collection throughout the world. Relais & Chateaux is immersed in the epicurean world and has predominantly smaller properties. The same is true of Small Luxury Hotels in terms the number of rooms their hotels offer.
Leading Hotels has curated a collection for our customer – the curious traveler – that truly inspires and encourages discovery of a destination. Whether it is a passion for food or the outdoors and whether our guest wants a boutique or grand property, each Leading Hotel is rooted in its destination and enables the journey to begin at check-in, not just when venturing out.
Q: How many hotels are added and how many leave each year, and how do you judge what makes a LHW hotel or not?
TT: On average, we add about 25 hotels a year with the same amount of hotels exiting the collection.
We have over 800 standards that we provide to our hotels and we like them to achieve at least 85 percent of those standards. They’re standards not of sameness, but of the right quality.
Beyond quality we look for a whole host of things before a member is admitted including its architecture, history, the owner, the operator, what’s the market, whether we can support the hotel, and whether we have other members in the same market. We ultimately are selecting high quality hotels that deliver an uncommon experience for guests.
Q: It is probably like choosing between children, but can you name some of your favourite hotels and why?
TT: It really is impossible to name a favorite – or even a few favorites – from among our portfolio. On a recent trip to Italy, I had the pleasure of experiencing five very different properties. Each of them – from Gran Melia Rome Villa Agrippina, built on the site of the former home of the mother of a roman emperor; to Fonteverde Tuscan Resort & Spa, a magical retreat that embodies all that is makes Tuscany irresistible; Portrait Firenze, an homage to haute couture on the Arno; the serene Hotel Il Pellicano on the Argentario coast and its sister property La Posta Vecchia Hotel, a former outbuilding to one of the oldest Roman families; the ancient thermal spa at Hotel Bagni di Pisa; to the intimate JK Place Roma – which has the scale and feel of a private home—revealed another of the myriad facets of Italy in its own unique way.
Q: What are your thoughts on the future of the luxury hotel industry and how it is evolving?
TT: One of the biggest shifts is how consumers are defining the standards of a luxury experience and not the supplier. Rather than suppliers dictating what they think qualifies as luxury, consumers are taking on a larger role in creating what luxury is and means to them. This is leading to more of a co-created experience with a hotel that is authentic and personalized.
With these changing expectations, hotels must also adapt in hardware and software to offer the latest in technological convenience, as well as the finest in furnishings and service. They will also need to keep placing even greater emphasis on the guest and staff experience. Not only does the quality of the accommodations, facilities and food & beverage affect the guest, but also how well and warmly employees care for customers is crucial to ensuring they experience genuine and memorable luxury hospitality.
As the customer base continues to skew younger, luxury hotels will need to keep abreast of the power of social media and how it impacts travelers’ perceptions and buying choices. Ensuring guests have access to engaging, immersive experiential options can encourage enhanced sharing along various platforms.
Luxury hotels will always be a pillar of the hospitality industry. Historically the top-tier properties have enjoyed consistent demand, and they have demonstrated the most resilience during and after periods of geopolitical and economic disturbances. Their continued success will depend upon how nimbly they anticipate and deliver on their guests’ rapidly changing needs and expectations.
Q: What are the most important must-haves that every luxury hotel needs?
TT: The Leading Hotels of the World established its product and service standards through Leading Quality Assurance, a joint venture that conducts anonymous property inspections for the world’s most prestigious hospitality organizations. The detailed 800+ point system is designed to cover all phases of the guest experience, from reservation to check out, including every aspect of the hotel product from reception, to back-of-house. A recent revamping of the standards criteria has strengthened the original system while integrating new, forward-thinking categories.
Serving as the benchmark for the luxury hospitality industry, the meticulous criteria by which we judge and accept our members is periodically reviewed and revised to adapt to the changing landscape and guest expectations. These quality standards are the foundation of our collection, but we also look at many other aspects of a hotel that truly facilitates the connection to the destination that our curious traveler is seeking. It is important that our collection has a certain common link for luxury standards, but we also encourage each hotel to remain distinct in character and authentic to its culture, to tell its own special story.
Q: How much does the occupancy of a hotel go up when it is named a LHW? Do they have to pay anything to bear the name?
TT: While we do drive direct occupancy to our hotels, members benefit from their memberships in many ways as part of a broader global network.
We used to have a fixed membership fee and then a reservation fee, but we are now in the process of completely eliminating all transaction fees and creating a new model that really gets back to the spirit of collaboration.
Q: How much do you have to travel and what are your tips for travelling and staying sane?
TT: When travelling, I enjoy getting to know the city or destination that I am in and one of the best ways to do that within the hotel is staying in a room with a balcony. Another tip is to stay at the end of the corridor to avoid the noise of people walking by. Since I am usually working while traveling, a room with some sitting area, so I can sit and read is a must along with a full-length closet, so I can hang my pants by the cuff.