Branding Success Hinges on Meeting Guest Expectations

In an industry where custo-mer expectations continue to rise, experts say travellers will increasingly reward hotel brands that are able to constantly meet their demands.

“An average holiday is not enough for today’s demanding travellers,” says Chris Nurko, Chief Innovation Officer at Interbrand, a New York-based marketing consultancy specializing in brands and branding management. “Incremental change will keep brands in the game, but it will take well-timed, brave moves to leap ahead of people’s expectations and drive extraordinary business results.”

But, with so many brands entering the Canadian hotel landscape, how can oper- ators avoid customer confusion and brand fatigue? According to Paul Loehr, area vice-president of Development, Canada, Marriott International, brands need to be clearly defined and positioned, while offering a distinct brand promise to the consumer. “Each of our [Marriott International] brands do this, which helps to provide the consumer with choice based on their personal travel needs and wants. Our Marriott Bonvoy program allows guests to experience a fulsome port- folio of hotels globally, while having the capacity to participate and benefit from a robust loyalty program.”

The aim, says Nurko, is to offer a seamless ecosystem of products, services and experiences that moves across multiple touchpoints to influence how a traveller will spend their leisure time and money. “Every hotel brand needs to find its own path that intrinsically aligns with its market context, history and business strategy.”

Nurko adds hotel branding should carefully consider the ever-shifting customer context. “As more people travel, new traveller types are coming into sharper focus: from ‘wander woman’ to multi-generational cruisers looking for travel as a way to bring the family together for quality time.”

He also notes the line between division of work and leisure is going to disappear, reinforcing the burgeoning ‘bleisure’ segment (75 per cent of business travellers are combining work trips with leisure activities). “We’re going to see more hotels challenging OTAs, luxury and boutique brands playing against the big hotel groups and travel agents versus self-serve portals. Even more, hotel actions are going to radically change. We’ve already seen some examples of this transformation.”

He points to loyalty programs transforming from rewards into a true customer experience as an example. “Marriott’s Bonvoy launched with a massive Super Bowl promotion, Accor announced [a rebrand/refresh of its loyalty program], “Accor Live Limitless” or ALL and Mandarin Oriental engaged Morgan Freeman and Helen Mirren for its celebrity-based Fans of MO,” he says. “Partnerships are changing and becoming centred-around digital transform- ation, which creates utility — Marriott International, for example, has partnered with Alibaba’s travel division and Fliggy as a new direct-to-consumer mobile portal and secure-payment system.”

The actual demographics of travellers also bear watching, says Loehr, as Gen-Xers enter their peak travel years. “We know Gen-Xers and millennials favour collecting experiences rather than things,” he says. “Understanding their specific behaviours and passions is key to delivering a hotel experience that makes an emotional connection with these guests. We [also] know next-generation travellers are become more discerning. A design-forward, hyper-experiential stay that’s connected to the local culture is what many of our brands are all about. There has been — and continues to be — a cultural shift of today’s consumer that doesn’t want cookie-cutter experiences.”

In fact, he says today’s travellers want to discover something new, take in the city, the food and the local scene — whether they are there for a day or a week. “Increasingly we see the blurring of lines between work and play, since technology has made us connected 24/7.”

So, how do hotel operators ensure their branding is attractive to the new generation of traveller?

“First, we need to understand the different needs of the consumer,” says Loehr, adding Marriott conducts significant research on general consumer behaviour, looking at why people travel and what they’re looking for when they travel. 

But, Nurko warns, hotels need to go beyond serving what they think a traveller would want, to reflecting the ideal each traveller has of themselves. “Travellers are more informed, more connected and more demanding than ever and their experiences are cast and recast by businesses beyond the tourism industry. People’s familiarity with other industries’ tech-driven advances in customization and user-friendliness are making a huge impact in the travel sector. Customer expectations have transformed and attention is harder to capture. So, even if the guests of a hotel might seem quite diverse, they share interests, needs and priorities.”

He encourages hotel brands to “shift from ensuring consistency to stimulating desire; from marketing-centric to enterprise-centric; from simply creating functional and emotional differentiation, to generating positive utility; and anticipating and responding to the shifting cultural trends.”

THE ROLE OF SOFT BRANDS
Soft brands continue to grow in Canada — in both supply and demand — and are quickly becoming the new norm.

“Customer-centricity was always key for hotels, but now the way to understand and deliver it is radically changed,” says Nurko. “People expect integrated end-to-end experiences that are highly personalized. This demands a capability to marry customer-centric data and understanding with the operational efficiency to provide value across integrated product, service and experiences.”

Enter, soft brands. Nurko says the combination of wealth of choice, erosion of loyalty, availability of information and shifting frames — the strongest challenge for hotel brands — is one of the top drivers of the soft-brand trend. “At the same time, the pressure on profits requires greater operational efficiencies and infrastructure management to meet and exceed customer expectations. From our Best Global Brands study — which we’ve published since 2000 — we learned the world’s most-successful brands are those that have placed customer-centricity and digital transformation at the heart of their strategy and innovation. Those brands that were able to leverage a deeper customer understanding and relationship were able to predict and serve a competitive value proposition.”

With soft brands, an owner has the ability to stay independent and tap into the sales-and-marketing engines and loyalty program of a major hotel company to drive both the top and bottom lines. Loehr point to Marriott’s Autograph Collection as a prime example. “Autograph Collection Hotels is a distinguished portfolio of independent hotels around the world that are exactly like nothing else — hand-selected for their rich character and uncommon details,” he explains.

Until the fall of 2017, the Autograph Collection brand consisted of two hotels in Canada — The Hotel Saskatchewan in Regina and The Algonquin Hotel and Resort in St. Andrews, N.B. Today, the Canadian portfolio has more than doubled with the introduction of The DOUGLAS in Vancouver (opened October 2017), The Civic in Surrey, B.C. (opened March 2018) and the Kananaskis Mountain Lodge in Kananaskis Village, Alta. (opened May 2018). The pipeline in Canada is also strong, with four confirmed new additions to the collection planned in Burlington, Ont. (2020), Saskatoon (2020), Calgary (2021) and Montreal (2021). “This speaks to both owner and customer appetite for a soft brand,” says Loehr. “We tell potential developers and owners ‘hard’ brands are ‘our’ brands, while ‘soft’ brands are ‘their’ brands. For those looking to build a hotel with a unique design or personality, they get it. They like how affiliating their independent hotel can help their unique, spirited property remain unique — yet benefit from Marriott’s reservations system, loyalty program, digital platform, scale, purchasing power and more.”

BRANDING 101 FOR 2020
As the hotel landscape continues to evolve in Canada and travellers redefine the guest experience, hotel branding strategies need to keep up with the shift.

“A brand strategy that involves core customer insights and understanding is vital,” says Nurko. “Customer-centricity demands the brand proposition and offer is aligned to both the key customer target audience and has a compelling point of differentiation in the product, service and experience. “

For some hotel brands, he explains, this will be in the ‘hard’ assets of property — rooms, features and facilities. For some, the ‘softer’ service aspects will be able to differentiate through guest hospitality and unique content collaborations. “A great example of this is the 21C Museum hotels, which seamlessly blend unique and curated experiences with a strong design and architecture aesthetic for a smaller chain of hotels in the U.S.,” Nurko adds.

“A continuing trend we’ve observed is the desire for more personalized and personally relevant experiences for travellers that respond to psychographic attitudes and behaviours inside and outside of travel,” says Loehr. “Hence the approach of creating a unique end-to-end branding experience that centres around a singular point of view and infuses that perspective into more touchpoints — design, service exper-ience, talent culture and marketing.”

Everything communicates a brand, he says, and the experience surrounding a brand is becoming more specific toward a specific consumer and/or trip purpose. “The diversity of brands allows travellers to choose their adventure depending on their personal lifestyle or a lifestyle they want to tap into for a specific trip purpose. Working with organizations like Marriott International allows owners to tap into brands that have a distinctive and well-executed POV.”