Collection brands are everywhere nowadays.
From Hilton and Wyndham Hotels & Resorts launching new collection offerings this fall, to Marriott expanding its new Series collection brand to the U.S., hotel companies are actively seeking out partnerships with independent hoteliers amid heightened demand for boutique stays.
The play isn’t a new one, though. Independent owners have been collaborating with bigger hotel brands for years. One notable example is Kessler Collection CEO Richard Kessler, who in 2010 joined forces with Marriott International to launch the luxury Autograph Collection with several of his properties.
Since then, however, traveler preferences have evolved. Today’s tripgoers want boutique hotels within established brands, so they can capitalize on loyalty points while still getting a unique and experiential stay, Kessler noted.
As more independent owners look to buddy up with the bigger brands during this shift, Kessler shares what’s top of mind for independent owners when a partnership is on the table. He also talks about the advantages and challenges of alliance and how the boutique space will continue to take shape.
This interview has been edited for clarity and brevity.
HOTEL DIVE: What are the nonnegotiables for independent hoteliers when teaming up with a brand?
RICHARD KESSLER: For independent hoteliers, maintaining the freedom to create the product that they have in mind or that they think is needed in the marketplace is really important, and as soon as the brand starts trying to control that, it will lose what it was trying to gain in the first place. It’s most important that the brands leave it to owners to create something unique.
The brands should be careful of telling independent owners what colors they have to use. As a brand, don’t tell boutique owners what kind of carpet to have, don't tell them what color the walls have to be, don't tell them how to decorate, because they will stop the conversation immediately and hang up.
The brands also have to be careful not to fall into the old pattern of what I call corporate creep, when they slowly start to dictate decisions that should be left up to independent owners. The next thing you know, they begin to tell you what color to make your hotel and what color carpet to have. That’s when they lose their sales pitch.
With so many unique properties joining under one flag, how can brands create cohesion?
There are still brand standards that keep the collections unified. But, instead of talking with boutique owners about the design details of their properties, brands should focus on quality standards, standards of cleanliness and food and beverage requirements — the elements needed to maintain the star-level quality they’re hoping to offer.
That’s what they want to sell, and that's what they should hold owners to. But they should keep it to that and not get into the weeds like they do with every other brand … because when they start doing that, they begin to kill the uniqueness of the offerings. As soon as they start creating a very defined brand out of it, instead of a collection of independent boutique properties, it turns the marketplace off and it turns off the people like me who've created something very unique.
For an independent owner, what are the advantages of joining an established brand?
When it’s difficult to get financing, particularly at a time like right now when costs have gone up and the borrowed amount becomes larger and larger, many banking institutions require a brand and a formal reservation system. So that's one advantage, and sometimes a necessity, of working with a brand like Marriott.
Additionally, being associated with a brand does bring a group of loyal customers to your hotel. However, I wouldn't deny that there’s disadvantages to these corporate loyalty programs. They are getting out of hand … in ways that really cost the owner. For example, let's say I build a property with 20 or 30 suites, and these suites should rent for twice what a typical guest room should rent for. If a platinum loyalty member shows up wanting a room but all of the rooms are full, then I’m likely obligated to upgrade that customer to a suite at no upcharge.
Will we continue to see new collection brands emerge?
That is for sure going to continue because people like surprises — good surprises — and that's what the independent hotels offer. Guests want to be surprised and delighted. They want to be entertained. In this independent space, you’re in the entertainment business. That's why everybody is jumping in trying to find and create these independent brands.
