LOS ANGELES—The age-old question surrounding the exact definition of “boutique hotel” might have become a little clearer during Tuesday’s opening day of the second annual International Boutique & Lifestyle Leadership Symposium at Hollywood’s Roosevelt Hotel.
The debate over the definition lasted throughout the day. The end result: It’s really up to consumers to decide.
Speakers were confident the segment has found a niche. Boutique hotels, in fact, can become brands, they said.
Boutique & Lifestyle Lodging Association founder Frances Kiradjian opened the event with the description that the segment was about flexibility, ingenuity and moxie. Virgin Hotels CEO Raul Leal said boutique hotels can garner significant revenue per available room and food-and-beverage achievements.
Leal, who treated the 265 attendees with Bloody Mary cocktails to start the day, said if a boutique hotel can own a specific experience, it can write its own definition. He said one unidentified hotel in New York rakes in more annual F&B revenue than five Marriott-branded full-service properties.
“It’s not about the product; it’s about the consumer that has a certain mindset, a consumer that is craving new experiences,” Leal said.
Richard Millard, CEO of Trust Hospitality, agreed.
“Consumers are looking for an experience. … They want the experience to have something to do with where they’re going,” he said. “In order to grow this segment, we don’t really care what it’s called; you have to do something in each location that is specific to that location to give the experience the consumers are looking for.”
Christian Strobel, co-founder of Basecamp Hotels and a former executive at boutique hotel pioneer Joie de Vivre Hospitality, said it’s not the number of hotels that matter. It’s the connection with consumers that can define the hotel.
“It’s more about whether you tapped into the nerve of a consumer,” Strobel said.
Julie Purnell, senior VP of acquisitions and development for Denihan Hospitality, said boutique brands are experience-based and have some common design elements while primarily focusing efforts on reflecting the communities in which they are located.
Niki Leondakis, CEO of Commune Hotels & Resorts, said in some regard, boutique hotels are hampered by their own rapid growth in popularity.
“One of the things that’s happened in the boutique/lifestyle segment over the last 10 years, the segment got defined by design,” Leondakis said. “The unfortunate thing about that today is too many people rely on design as the defining characteristic of their asset. The experience has to be the differentiator.
“Design is the price of admission,” she said. “We’ve come full circle back to the art of hospitality. It behooves us to really concentrate on the guest experience.”
A new brand of discussion
A conversation about boutiques as brands almost always goes hand in hand with the definition discussion. The symposium was no different.
Panelists throughout the event’s first day repeatedly said it’s OK for boutique hotels to be brands.
“Boutique hotels can grow, can become big brands with lots of different outlets,” said Craig Greenberg, president of 21c Museum Hotels. “Each individual project has its own sense of authenticity in terms of place and people. As long as it stays true to authenticity, the sky’s the limit.”
Millard said the “branding” of boutique hotel collections has a lot to do with economics.
“It takes a lot of capital to be in this business,” Millard said. “You need an infrastructure of some kind to make these things grow.”
But there are some things owners must keep in mind when turning boutiques into brands.
“The real challenge is how you actually keep the uniqueness and the scale,” said Brad Wilson, president of Ace Hotel Group, who was an executive on the ground floor of ultra-boutique brand W Hotels 15 years ago. “The challenge we find and we’ve been investing in is about people and the creative force that make those hotels purely unique. You need a team that’s really hands on.
“A boutique hotel needs to feel as if somebody made it,” he said. “It is a challenge to scale up.”
Connecting the dots
Sam Bakhshandehpour, president of sbe/SLS Hotels, agreed individuality is important whether it’s a single boutique hotel or a collection of them.
“I refer to it as guardrails more than a template,” Bakhshandehpour said. “At some point, when you start talking templates you need that infrastructure to be able to grow. … Stay true to the brand while customizing for specifics of that respective market.”
Michael Tall, president & COO of Charlestowne Hotels, said his company has never created two hotels with the same name, so “template” is not an option at this point.
“It gets to a place, whatever number that is, (where) it becomes a brand, or it becomes a reproduced mechanism,” Tall said.
Wilson said a branding effort for boutique properties can sometimes get in the way of the hotel actually reaching the intended level.
“Curiosity is the strong word,” Wilson said. “The standardization that’s required for scaling at times can become in conflict with leveraging that curiosity.
“It can be done, but it’s a lot of hard work,” he said. “It’s a lot of effort to make sure you’re staying curious. If you can keep that curiosity in that culture … then yeah, I think it’s completely scalable.”
Gregory Peck, president of Crescent Hotel Group, said using the same name for properties in different locations is fine as long as the hotels are unique.
“We decided to extend the name to the Hotel Crescent San Francisco, but virtually every other aspect of the hotel was different,” Peck said. “The building was different. We designed it around what the building gave us.”
While he didn’t specify a number, Bashar Wali, president of Provenance Hotels, said until a group of hotels reaches critical mass, they aren’t a brand.
“Hand-crafted hotels that are curated and not cranked out take time,” Wali said. “With success comes the desire to do more. All of a sudden by doing more you don’t have time to do hand-crafted any more.
“For us, it’s all about the individuality of the hotels,” he said. “A lot of the consumers connect the dots.”