Back in the 1980s when Robin Leach entertained TV viewers with his thick, nasal English accent on Lifestyles of the Rich and Famous, the term “luxury” was used to describe homes and hotels designed with over-the-top extravagance, heavy on the gold
leaf, silk fabrics and crystal chandeliers.
Since then, however, the definition of what constitutes a luxury hotel has undergone a radical transformation, becoming less a matter of surface glitter and more about refining the guest experience.
Among those who note the change is Karen Weiner Escalera, president and CEO of KWE Group, a Coral Gables, Fla.-based marketing, communications and public relations firm specializing in luxury travel and hospitality, who has been following the luxury market for 28 years.
“There is no one definition of what is luxury,” she says. “It used to be that luxury was defined by price and brand, which gave status; i.e. if it was expensive, it was luxurious. It also tended to be defined by Old World trappings—the more rich brocades and silks, antiques and white glove service, the more the hotel product was viewed as luxurious.
“But in less than a decade, that has changed dramatically. Luxury has no single definition,” she says. “It means different things to different people. It is not monolithic anymore.”
Sense of Place
Steve Hennis, managing director of Arvada, Colo.-based Hospitium, says there have been a plethora of marked differences seen in luxury hotels in the past few years. One of the most evident is the fact few new luxury hotels are being built without a residential component.
“Over the past five years, the model has become more geared toward having a residential component. A lot of it has to do with construction costs,” he says, adding that luxury hotels are especially costly to build.
In addition to the influx of residences, many brands are trying hard to establish a sense of place, moving away from their traditional cookie-cutter images. Instead, hotels are taking more of an interest in incorporating the culture, art and even food of a location into their motif.
“I think a lot of five-star hotels are really tapping into the destination they are in,” says Darla Methey, CMP, El Cajon, Calif.-based national account manager for ConferenceDirect. “A five-star property in Scottsdale [Ariz.] is going to be different than a five-star in Hawaii.”
Sean Hennessey, CEO of New York-based Lodging Advisors, says one reason big-name hotel companies are taking an interest in incorporating specifics of a destination into their interior is because they have seen the success enjoyed by boutique hotels that have done the same.
“The brands have gotten very much oriented toward their properties having individual character that is incorporated into their interior design,” Hennessey says. “It used to be that the brands would have a high level of uniformity because then customers would know what to expect. Now it seems that the customers want to be delighted and perhaps surprised by the unique character of the hotel.”
Another change Hennessey notes is the increased size of guest rooms within the past few years.
“The size of the guest room itself has expanded,” he says. “Luxury brands are now demanding that their investors and developers provide them with rooms that are 550 to 650 square feet, where 10 years ago, 450 square feet may have been acceptable for a luxury hotel.”
Along with guest units, larger guest bathrooms and high-end bath amenities have become hallmarks of a luxury hotel.
“The level of finish has moved up dramatically. Now it is pretty much standard to have a four-fixture bathroom in a luxury hotel and a separate bath tub and shower,” Hennessey says.
At Your Service
Sarah Galbraith, CMP, partner of Jensar Associates Inc., a Harrisburg, Pa.-based conference, management and communications firm, says the most sizable change she’s seen in luxury hotels over the past several years is the huge emphasis on spa amenities.
“The spa has been the biggest trend in the past three to five years,” she says. “There are requirements for spa services and the spa amenity side of things has really increased.”
ConferenceDirect’s Methey agrees.
“Years ago, the five-star hotel had a spa, but it was usually very limited. Now it seems that the spa treatment rooms and the amenities and the procedures are just growing stronger,” she says.
Along with spas, many luxury hotels are upping the ante on food and beverage outlets, often drawing on the talents of celebrity chefs.
“Now at the luxury level you have a lot of name-brand chefs being associated with properties as well as name-brand restaurants as part of the hotel’s portfolio,” Hennessey says. “This is a reflection of the hoteliers being smarter about the food and beverage and the general public having recognized that hotel restaurants can be pretty good.”
Industry observers also note that many luxury hotels are placing more emphasis than ever on personal service.
Methey recalls that on a recent trip to a luxury resort in the Caribbean, she was greeted with a warm towel and a complimentary iced tea.
“That was strictly a luxury amenity,” she says. “Then I was walked to the front desk and walked to the elevator.”
She adds that many luxury hotel companies are fine-tuning their approach to service and that guests’ expectations have never been higher.
“The time five-star properties are spending on their employees is tremendously more than years ago,” Methey says. “The time they are investing into training them is just on a whole different level than it was. The customer is looking for the front desk to know them by name. It is becoming a lot more personalized, and the client and customer want that. They want to feel like a VIP when they walk onto that property.”
Growth Spurt
In addition to an evolution in services and amenities, the luxury segment is also in the middle of a sizable growth spurt where established hotel companies are entering and re-entering the luxury market and new brands are popping up left and right.
Heather Small, market analyst for Portsmouth, N.H.-based Lodging Econometrics, says established companies are “introducing new brands to tap into different demographics or expand their range in a particular area,” and the luxury sector seems to be the market’s current sweet spot.
“The luxury sector is seeing the highest performing rates of any sector,” she says. “There is a lot of growth in the young, economically advantaged demographic, and I think a lot of these new brands are targeting that demographic.
“This is going to continue to be a strong market as far as construction goes,” Small says, adding that 61 new luxury properties are under construction.
The growth is also a product of hotel companies “wanting a greater share of the customer’s wallet,” says Lodging Advisor’s Hennessey.
“Keeping customers within your brands is attractive for hotel companies,” he says. “During one trip they [travelers] will look for all-suite hotels, another trip they will look for corporate hotels and another will be a romantic getaway and they will want luxury hotels. The cost of keeping a customer is much less than the cost of finding a new customer.”
Expanding Market
Hospitium’s Hennis says another reason for the sector’s growth is an expanding market for upscale experiences.
“Within the past couple of years, Baby Boomers have started retiring,” he says. “A big dynamic is that the Baby Boomer generation is going to inherit a significant amount of wealth. The [former] generation was taught to save, so the Baby Boomer generation will inherit those savings and they are used to being pampered.”
He says that because of that dynamic, the demand for luxury hotels, as well as multiple vacation homes, is growing exponentially.
“It seems to be much more apparent that a summer home and a second home isn’t a luxury anymore. People think that is a given. It is the same with timesharing. Now it is the highest growth sector in the industry,” Hennis says, shedding light on why more and more residential units are popping up in luxury properties.
KWE’s Escalera says the growth has to do with not only the increasing wealth of consumers, but also increased sophistication of travelers.
“After you’ve been to Mexico and the Caribbean and Paris and London and Rome, what’s next? You want something different,” Escalera says. “The more sophisticated a traveler you are, the more you want something unique, personalized, customized. People are looking for those one-of-a-kind hotels.”
