Como Hotels and Resorts is executing a strategic plan that highlights the broader dynamics of the luxury sector.
If you haven’t heard much Hotels & Resorts in Como, I hope you do it soon. The luxury brand is taking some distinctive steps that are worth noting.
While not a unique company, Como Group appears to be emerging from the pandemic with more momentum than many of its luxury hotel peers.
- This fall, he opens Como Singapore.
- A few months ago, she opened Como Le Montrachet in France.
- Other recent additions include Castello Del Nero in Italy (2019), Como Castello Del Nero in Tuscany, Italy (2020), and Como Laucala Island in Fiji (2021).
- Como Group plans to open about one property per year on average. The group is finalizing a project in Japan. It wants to expand in countries like Bhutan and Antarctica, but also in remote outposts in markets like the United States, for example in the desert or in the mountains.
The company has the resources to grow, despite competition with better-known brands like Four Seasons, Belmond, Montage and Auberge.
- Billionaire Christine Ong founded the company in 1991 by opening The Halkin in London. Today he has 18 properties worldwide.
- It claims to be the oldest luxury hospitality brand still controlled by its founder.
- Christine Ong owns 85% of the group.
- Ong and her husband, Malaysian businessman Ong Beng Seng, had a net worth of around $1.7 billion in 2019, Forbes estimated. They have significant investments in real estate, retail, fashion and hospitality (excluding Como).
- They have stated that they want to keep Como for years and years to come, and they have the resources to make that plausible.
To find out more, I spoke with Olivier Jolivet, CEO of the Como group. He has thought a lot about how luxury hotel companies should approach their strategic planning.
- The Singapore-based CEO started his career at McKinsey.
- Then Jolivet joins Club Medwhere he held positions such as Director of Group Development and Asset Management.
- In 2008, he joined A man, an ultra-luxury supergroup. He helped implement the brand’s revamped strategies and served as group CEO between 2014 and 2017.
Jolivet told me that some of the smartest strategies for luxury hospitality companies today involve telling a unique brand story..
- Como tries to talk about rare experiences.
- A good example: he opened the first phase of Como Le Montrachet this year in Burgundy.
- No other luxury hotels exist in Burgundy, although its coveted wines appeal to many wealthy people.
- “With a 30-key hotel (in Burgundy), we barely cover our costs because everything there is expensive,” explains Jolivet. “So you need dexterity to run. But we felt we had to be where others weren’t. Because we have to offer an experience. You are not selling a room. You’re selling an experience that customers will always remember.
- The result is a growing share of repeat guests, with 35% of its guests this year being repeat guests – a high ratio for a property with only around 15 properties.
Jolivet has refined the Como group’s strategy over the past five years. Sale of non-core assets is on the table.
- “We had to decide whether we want to be the biggest or the best in our category,” Jolivet said. “We chose to be the best.”
- “That means we need consistency across the portfolio,” he said. “We may need to sell some non-core assets and invest more in the high end of the market and a ‘small is beautiful’ lifestyle approach.
- The company is looking at a few assets that don’t generate as high a rate as average and is talking to hotel brokerage firms about possible asset sales.
Adding premier properties is also essential.
- To appeal to asset owners, Como Group can offer to invest money in the initial investment related to the development of a property or can guarantee gross operating profit based on performance. Large hotel groups with limited resources rarely offer one or the other, and Como could thus win certain contracts.
- “We appeal to a certain type of owner because we also own hotels,” he explains. “We could buy out a partner in the future if necessary, whereas large hotel groups with few assets cannot offer this.”
- Adding properties with higher rates will help increase results. Como Group’s turnover before the pandemic was $497 million in 2019.
Jolivet has focused on hiring and retention, as staff are essential to providing high quality service.
- “Large hotel companies struggle to hire and retain top talent,” Jolivet said. “Today, about 95% of our staff have been here for at least three years, which is something most of our biggest competitors can’t say at the moment.”
- A recruitment tool involves offering employees and their families the opportunity to remain employed outside their home country for a period of time, such as allowing Indonesian workers to work outside Indonesia for a period of time .
- He’s also considering giving company stock to employees as an incentive to stay, because that’s something the “big guys” won’t do.
- A simple increase in salaries is not always feasible. When he joined the company five years ago, he streamlined many operational processes to better control costs. “We are not a charity,” he said.
Focusing more on wellness services is also a priority.
- Jolivet wants to move towards holistic hospitality focused on well-being, a growing interest from guests. Como already offers health offers in its seaside resorts located in remote areas.
- “But more and more city leisure travelers want to be in a city but also have a feel-good experience,” he said.
- It is looking for potential partners to help it improve this offer in its most urban sites.
Luxury hotel brands also need to be effective in their marketing, Jolivet said.
- An effective strategy is to partner with travel agents and tour operators specializing in luxury customers on a commission basis.
- Como Group is also making its loyalty program more “experiential,” it said in an attempt to stand out from competitors. THE “Como ClubThe rewards program offers members priority reservations at the group’s restaurants, complimentary wine consultations and fitness workouts at select properties, access to limited-edition fashion collections at Club21 fashion stores and more. other advantages with partners.
- Besides other tools such as social media promotion, Como also tries to identify its most valuable customers and stay top of mind for them. “Some of our general managers (general managers) know the birthdates of certain guests and may send a gift or message,” he said, in order to maintain the relationship.
- From the company Como Foundationwhich supports charitable efforts aimed at empowering women around the world, also offers a positive brand halo.
Jolivet says Como Group’s long-term capital resources help inform its strategy.
- “The founder wants to own it for years and years to come,” he said. “This allows for a completely different portfolio construction strategy than publicly traded companies did just a few years ago. They must create synergies and cut corners. So if you stay at their properties, you will find that the quality of service is inconsistent across their portfolios.
- “The longer time frame is important because you can’t take a small luxury hotel from zero to high profits in just a few years,” he said. “In luxury, time counts. »