If you ask John Scott, president and CEO of Belmond (the new name for Orient-Express Hotels), about the true meaning of luxury, he’ll offer several strong opinions that all come back to a common theme: Luxury is all about the guest and a fastidious attention to detail.
“True luxury is about understanding your guests,” he said. “It’s customization. Give me what I want. Give me the fruit basket or something that I’ll use. Don’t give me a bottle of wine when I’m staying on business for one night when you know for certain the bottle won’t be touched. If I’m traveling with my wife, give me the Champagne.”
That attention to detail means stocking Diet Coke in a guestroom minibar when you know it’s your guest’s favorite, or going the extra mile when replacing a guest’s forgotten toothbrush with the exact brand and type he uses at home. Those small elements add up to true luxury, Scott said, who has spent the past few months morphing Orient-Express Hotels to the entirely new Belmond brand.
“You can clearly see I’m passionate about this stuff, and we do some of it very well. But I think we’ll be able to do more of that well with our new Belmond brand,” he said. Scott joined the company in November 2012 after serving as president and CEO of Rosewood Hotels & Resorts for nine years.
The rebranding of Orient-Express to Belmond, which means “beautiful world” if you know your Latin, has been the buzz of the luxury business since it was announced in February. The move was primarily prompted by the fact that the Orient-Express name was licensed from French transportation company SNCF, so there were limits as to what could be done with it. Belmond is 100-percent organically grown and owned; it’s a brand that can be shaped and evolved and crafted as its executives see fit, and that’s just what’s about to happen.
Pictured: Belmond Villa San Michele in Florence, Italy, dates back to the 15th century. The hotel’s facade is attributed to Michelangelo.
First up is bringing together a group of luxury products that are wedded through the sheer fact of their iconic status. There’s the Venice Simplon-Orient-Express (which will retain the Orient-Express name), but did you know the family also includes a line of adventure safaris in Botswana and river cruises in Myanmar? Maybe you’ve heard of the legendary Hotel Splendido in Portofino, Hotel Cipriani in Venice, the Copacabana Palace in Rio, the Hotel Ritz in Madrid and the Grand Hotel Europe in St. Petersburg, Russia? There are about 35 other hotels of a similar ilk in the company’s international portfolio.
Belmond has already made its name in the marketplace. Consider the Hotel Cipriani, which is now the Belmond Hotel Cipriani, and the Grand Hotel Europe, now the Belmond Grand Hotel Europe. But even though the Belmond name is right up front, it’s meant to be a subtle touch to the existing well-known hotel moniker. “Belmond will certainly not be flashing in bright lights,” said Scott.
That’s in regard to the hotel names, but the Belmond brand will be shouted out loud and clear in the market, as Scott and his chief sales and marketing officer Ralph Aruzza use a war chest of $15 million over the next four years to promote it—$5 million set for 2014 alone.
Pictured: Belmond Hotel Splendido is located in Portofino, Italy, and overlooks the harbor of Portofino and its yachts below. Pictured here is the living room of an Executive Suite.
The first-ever brand-wide promotion to attract new guests and build cross-visitation throughout the portfolio is already in the works, social networking touting the new brand is evident on all the networks, and there’s even an Instagram photo contest for Belmond employees who are encouraged to take photos of moments that define the Belmond brand. (The winner will receive an all-expense-paid trip to a Belmond property.) It’s likely a similar contest will follow for consumers.
“We think there are a lot of ways to really extend the concept of a ‘Beautiful World,’” said Aruzza. “It’s one of the reasons we really liked the name. It absolutely connected with what our traveler experiences are.”
Scott, meanwhile, loves the full control and flexibility he, Aruzza and the team have with the name. “And that gives us great confidence to invest in the brand,” he said.
The plan is for consumers to “get” the fact that, say, the Cipriani hotel in Venice is related to the Villa San Michele in Florence and Maroma Resort on Mexico’s Riviera Maya. This thread was not recognized under the Orient-Express brand, Scott said. According to the Wall Street Journal, just 3 percent of visitors stayed at more than one property within the portfolio.
“They didn’t make a connection to all that we were,” he said. Now, instead of promoting hotels as individual assets, the company is sending the message that they’re part of an elite collection. It’s a way to entice the guest to “connect the dots and really understand that if you liked Belmond at one location, you’ll like it at the next location,” said Scott.
Who then is the Belmond customer? Right now, Belmond guests skew older by simple virtue of the price points of the hotels, cruises and safaris.
Pictured: Belmond Hotel Cipriani in Venice, Italy, is set on Giudecca Island. Shown is a double bedroom that overlooks the Casanova Gardens.
That’s okay by Scott, since this group has the means and time to travel, as well as the desire for something special. “They’re looking for those experiences, which is what we sell,” he said. “The affluent traveler is looking for more experiences because you can get the same marble bathrooms and the same large rooms anywhere. What makes [the travel experience] different and unique? I think we appeal to that customer.”
He also has his eye on a younger active and affluent set in the 35 to 55 age range. The challenge there is keeping the hotels, most of them historic, relevant to a younger age group, as renovations and updates are done that remain faithful to the nostalgic aspect of the hotels.
“There’s a great trend toward nostalgia. You want to recall that experience you had with your parents and do it with your family. If I were a 35- or 45-year-old, I’d want to take my kids on the Venice Simplon-Orient-Express. Wow. I’d know they would remember that and talk about it. Nostalgia works for a younger generation so we need to make sure we’re relevant for them,” Scott said.
Scott and his leadership team will address this issue of relevancy as they expand the Belmond portfolio, a strategy that’s very much on the agenda.
The company’s business model has been to own all or a portion of its hotels, but it’s starting to dip its toe into third-party management contracts, a less capital-intensive strategy. That tactic led Belmond to sell The Inn at Perry Cabin, in St. Michaels, Md., but retain management of it.
“We’ll do more of those [types of deals],” Scott said. “We have the sales and marketing infrastructure. We’re great operators of hotels and we have very loyal customers. [Hotel] owners like that and we can offer them those resources without having to own and build every hotel in our portfolio.”
Ownership is still very much an attractive option as well, he added. “Will we acquire hotels? Will we develop other hotels? The answer to that is yes. We’ll do it opportunistically, where we see a fit.”
Pictured: The pool at Belmond La Samanna in St. Martin. The main building of the hotel is in the background.
That might mean adding rooms in an existing location or adding a new hotel in a region such as Italy, where Belmond already has a strong presence. “Could we develop a hotel in Milan or Rome by developing or buying or redeveloping it? The answer is yes,” he said.
A development team in Belmond’s London headquarters is pursuing those fronts; the company also has an architecture, design and technical services team working on renovations and additions to existing properties. For example, late last year, a $7.5-million renovation of the 81-room Miraflores Park Hotel in Lima, Peru, was announced; the hotel reopened recently in time for high season.
Growth from within
Pumping up existing assets to meet demand and garner additional revenue is a sound practice in Scott’s mind, or as he prefers to put it: “Look in your backyard first for growth.”
Case in point: A new excursion was added onto the Venice Simplon-Orient-Express, a move that generated nearly $1 million in revenue. A new river cruise in Myanmar that leveraged existing guests who’d sailed on the Road to Mandalay program and wanted to do something different had similar positive results.
On the hotel front, Villa Sant’Andrea in Sicily is getting six new luxury suites added to its inventory, which will appeal to affluent travelers who more and more seek larger accommodations.
“I can grow my business by going to each property and adding a villa or some new suites, restaurants and amenities. The employees love that because we’re investing in existing businesses. Investors love it because there’s a good return and it makes sense,” Scott said.
Moreover, guests are demanding it. At Belmond, suites and villas are selling out first. “I wish I had more of them because I have more demand for our best product than I have for anything,” said Scott, noting that this bucks the trend of how hotels used to sell inventory from the bottom up, only to give unbooked suites away.
At the Grand Hotel Europe in St. Petersburg, Russia, rooms on the first floor have ceilings that are 20-feet high but the rooms are tiny, almost bigger vertically than they are horizontally. They’ll be turned into what Scott said will be extraordinary suites, “the best in St. Petersburg.” Included will be a three-bedroom presidential suite.
He cites the needs of his own family, which includes three young children. “If I put them in one hotel room together, and you’ve got a lock off like hotels traditionally have had, and my wife and I are in the other room, it’s a disaster. I need a villa, not because I’m affluent and I want one, but because I need to enjoy my vacation,” Scott said.
Another trend he sees as a strong influence in the hotel space is the blending of business and leisure travel. A couple might travel together on a spouse’s business trip if it’s to a great city like London where they’ll enjoy the hotel’s fine dining restaurant, the spa and then head to the theater.
That blending of trip intention should be reflected in how a guestroom or suite is laid out, Scott said.
“If I wake up in the morning and my wife says, ‘I want to sleep until 10 a.m.,’ and I’m sitting there doing conference calls, that doesn’t work,” Scott said. “So we’ve got to provide the right product, a location to go to, whether it’s a business center—that’s old-fashioned—or an ante-room in the suite—I actually have a room like that at my house. That way I can go to work for two hours before the kids get up. It’s also got to have great wireless, and the wireless has to work at the beach. We need to think of ways to enable people to stay connected when they’re on vacation. Luxury is about giving people options.”
Scott is looking forward to delivering those options within an array of luxury products united under the Belmond brand. “I’m often asked what makes an iconic hotel,” said Scott. “Some people think it’s how long it’s been around. Some say it’s the architecture. Others think it’s more about who’s stayed there. Then it dawned on me—it’s all of those.”
An icon is also irreplaceable, he added. “You couldn’t replace the Hotel Cipriani today. You couldn’t replace the Copacabana Palace or the Hotel Ritz Madrid.” Having 45 such products makes the entire portfolio iconic, he said. “To have all this in one company, it’s quite rare.”
At a glance
Portfolio: 45 hotel, rail and river cruise experiences
Meet the Belmond GMs
Watch for upgrades and additions at Belmond hotels to continue; a relatively new practice is to have the company’s GMs heading up Belmond’s hotels report to London headquarters several times a year to pitch ideas to corporate for additions or renovations to their hotels in what Scott says resembles a “Shark Tank” environment.
“Our team collaboratively vets the best opportunities. If it’s not accepted it doesn’t mean that your idea wasn’t great. It just means it may not happen this year, it may happen the next year,” he said.
It’s natural for GMs to be strongly involved in their hotel’s physical offerings—that’s the company culture.
“There’s an individual, entrepreneurial spirit at each of our properties, and the general managers who run our businesses are a unique breed,” said Scott. They’re given a luxury template, he said, but the manner in which each general manager delivers five-star luxury is unique.
Pictured: Belmond’s executive team and GMs from all over the world met in Charleston, S.C., recently to strategize around the new branding. Orient-Express officially became Belmond in March.
He feels that varies widely from some of the bigger brands. “They’ll give you a map and say we want you to go from point A to point B. They’ll tell you what road to take and how fast to drive and they’ll give you all the rules of engagement. They’ll say stay on that road and don’t go off of it. If you go off of that you’re not one of us. In our culture we will tell you we’d like you to get from point A to point B by a certain time. You pick the road and you navigate that journey.”
The global group of general managers recently headed to Charleston, S.C., to engage with senior management on the move to the Belmond branding.
“It is really about getting them excited about being a part of something bigger,” said Scott, who believes the connectivity the brand brings to all of his hotels will also attract new employees as they see the opportunity to develop within the network. “There’s a great opportunity for us to transfer culture by being able to move people from property to property. They’ll see it as a long-term career. That is a cultural change, but I think it’s a good cultural change.”