In today’s hospitality arena, there is a movement to create more boutique hotels, which can offer solid profit margins and the ability to offer a unique guest experience.
The challenge is that many investors moving into this space – to capitalize on this opportunity — are taking a “me too” attitude with the singular focus on making the property’s design different and innovative.
As recently highlighted by boutique hotel visionary Ian Schrager, the key to success is attitude and approach, which should be about offering an elevated experience.
Schrager also pointed to the need to stay away from just focusing on design.
“Special effects in a movie make a good movie better, but they don’t make a bad movie good. I’m worried we’re seeing the same kinds of hotels now but in different colors,” said Schrager at the recent Boutique Investment Conference.
He also discussed how guests often don’t expect top service from boutique hotels. When top service is combined with top design, then the real “alchemy” of true guest loyalty can be fostered. It also takes an attitude where traditional hospitality rules should be broken, which can lead to long-term success.
As the boutique hotel sector continues to be a prime target for investors, Schrager’s insights should clearly be taken into consideration, especially since there’s the risk of oversupply.
“It doesn’t matter that there’s an oversupply problem in New York. Come prepared with a great product, and it’ll do great. Same with Airbnb. The best way to compete with Airbnb—which is coming after our children—is to provide a unique experience,” added Schrager.
The “unique guest experience” continues to be the holy grail in the hotel arena. The challenge is that the stakes are higher for boutiques, and the need for the right “attitude and approach” will dictate business growth in the long run.