One-on-one with Ritz-Carlton's Herve Humler

Hervé Humler, the newly named president and COO of The Ritz-Carlton Hotel Co., has taken the top post of the luxury hotel company at a time when its portfolio contains a healthy 73 properties and its pipeline is robust. New-builds for its core brand and its fledgling Reserve hotels are on the drawing board for regions throughout the world.

Humler is not a newcomer to Ritz-Carlton; in fact, he’s one of the founding executives who were part of the original Monarch Hotels Co. that quickly evolved into Ritz-Carlton International.

As employee No. 4, Humler was part of the group that included Colgate Holmes and Horst Schulze, who went up to the Ritz-Carlton in Boston—the only hotel to carry the name at the time—when it was put up for sale. To own the Ritz-Carlton name, the hotel had to be purchased. That they did and a luxury hotel company was born.

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Out went the Monarch Hotels concept; they opted instead to go with a more luxurious hotel concept whose properties would carry the Ritz-Carlton moniker.

“We looked at each other and it was kind of a little bit of a letdown because we’d positioned Monarch extremely well and we said, ‘What are we going to do with that name?’” Humler said. “We went back to Boston, and we looked at the hotel and we did find a few cobalt blue glasses and a few packets of matches in cobalt blue and we saw the Ritz-Carlton logo on an old hotel.”

It was 1983 and there was work to be done, including creating the original Ritz-Carlton tenets based on the fact that the company’s employees are “ladies and gentlemen serving ladies and gentlemen.” Other founding Ritz-Carlton philosophies that were created and remain to this day include engaging with guests and employees, as well as getting deeply involved with the community the hotel is in.

That’s a philosophy that Humler, a native of Toulon, France, is known for. A hands-on manager who gets deeply involved with employees and guests alike, it’s likely that tactic was implanted early on in his DNA. Humler was actually raised on Africa’s Ivory Coast, where he eventually ended up managing a friend’s small lodge on a remote island, where he did virtually everything.

“It was in north of Abidjan in what we used to call in a bush, the jungle,“ Humler said. “It was a small lodge next to the Bandama River and there were elephants, hippopotamuses and lions all around. Frankly, I had no idea what I was doing, from buying food to having people cooking the food to cleaning up the rooms, but a lot of things made a lot of common sense.”

Humler may not have realized it at the time, but he was building a philosophy of how hospitality should be delivered. “It was truly what we call guest engagement,” he said. “Because the lodge was so casual, I would spend time having dinner with the people whom we escorted in the jungle. We’d know them after two days or three days because we’d have breakfast with them, you’d sit down, you would share a cup of coffee, you’d tell stories, they’d tell you stories, and you’d get to know the family. They would say, ‘By the way, I live in Paris and when you are in the city, please come to visit, I’d like to buy you dinner.’

“That’s how you create a relationship that’s very personal. People would send back their friends to visit us and then they’d come back themselves to visit the lodge and you’d see some of them for many years after that. That’s what I really learned there. If you engage with them, if you give people what they want and if you know them, you know what? It’s going to be a relationship forever,” Humler said.

That same mentality today influences his management style. “You’re not only the president of the company, you’re also serving the people, which means I’m a servant to my customer and I’m a servant to our ladies and gentlemen who are our Ritz-Carlton employees, too. That’s the way I always feel,” he said.

Growing Ritz-Carlton Internationally
As the company expanded, Humler was eventually charged with growing it internationally; he opened locations in Barcelona; Bali; Santiago, Chile; and Shanghai, to name some.

“Since 1996, what I did is develop the brand outside of the United States,“ said Humler, who did it all based from the company’s headquarters in Chevy Chase, Md., a suburb of Washington, D.C. “It was a lot of travel, but it was exciting traveling, trying to position our flag all around the world. We have a small team, but it’s a very efficient team. It was a lot of fun; it was certainly a lot of work, but, overall, we have done quite done well because today, when we look at 15 years later, we have more hotels outside of the U.S. than we have within the U.S.”

Humler said it’s been easy for him to come back and fill in for Simon Cooper, the former president and COO of the company, who transferred recently to Hong Kong to head Marriott International’s expansion in Asia Pacific. The management style of the two is also quite similar, he said. “We both travel extensively and you have to listen to your customer. You still need to solicit the opinion of your ladies and gentlemen around the globe; it’s so important that you get as many opinions as you can before making a decision.”

Integration with Marriott
Global growth is clearly the biggest change for Ritz-Carlton. However, another big move occurred when Marriott International took a 49-percent stake in Ritz-Carlton in 1995, before fully acquiring it in 1998. Since the beginning, Marriott made it clear it would keep Ritz-Carlton separate from its other operations; however, over the past year, the luxury brand has become a bit more aligned as far as sales and other efforts are concerned.
Humler insists that what’s occurred is that Ritz-Carlton has more access to Marriott’s tools. For example, Ritz-Carlton, with just 73 hotels, has access to reservations technology companies its size would not typically have. Marriott’s global facilities additionally help Ritz-Carlton in its efforts to develop internationally.

“Marriott has several offices in Hong Kong, in Europe, in the Middle East and we use the same development team. They have the responsibility of any market I’m going to and they can assist us with accurate decisions [as to] whether a place is going to be a luxury market or not.”

Similarly, Ritz-Carlton was able to launch a loyalty card last year, another initiative it couldn’t have done on its own. It was time to implement the program, said Humler, particularly because competitors in Asia, such as The Peninsula Hotel Group and Mandarin Oriental, have loyalty programs. Ritz-Carlton customers were asking, “When are you going to do something for me?” he said.

Wanting to do something different, Ritz-Carlton worked with airlines, cruise lines and tour operators like Abercrombie & Kent as well as designers like Vera Wang, for whose products points could be used for redemption.

“We’re looking at some new opportunities right now and we’ll be able to announce them sometime in June,” said Humler, who said that thus far, 68,000 members have joined the forum worldwide.

Bottom line, said Humler, “We can use everything that we can [from Marriott International] to enhance the Ritz-Carlton. If it doesn’t enhance Ritz-Carlton, I’m not going to use it. We continue to work with Marriott on a daily basis to find the right balance between partnering in some of the forums they have that will deliver maximum value to our guests and our owners and certain areas that we must maintain, because they are distinct to our brand. We are not going to put the Marriott name above our hotel and the Ritz-Carlton name underneath. Absolutely not.”
Reserve

In fact, Ritz-Carlton is forging ahead with a new brand of its own, Reserve, whose first property, Phulay Bay, opened in Krabi, Thailand, in December 2009. The resort is a 54-room boutique hideaway that sits on 10 acres of beachfront. More Reserves are planned for Costa Rica, Puerto Rico, the Turks and Caicos, United Arab Emirates and Similan Beach, Thailand.

“We realized four or five years ago that there was an opportunity to go in to some very small but very high-end markets that I would not be able to go into with a Ritz-Carlton,” Humler said. “Reserve would also allow us to compete with some very small but very high-end brands globally, especially in some of the markets where they are.”

The Reserve in Krabi, 20 miles from Phuket, is comprised of large villas with a great sense of place, he noted. “If you’re a business executive and you’re traveling the world, you would come to this type of location to get reacquainted with your family and your loved ones. It’s for those people who say, ‘I’m going to spend a week here and I don’t want to hear about business,’” Humler joked. There is a small business center for those who need it.

Deals for seven new Reserve hotels have been signed and three new properties are under construction, Humler said. One in the works is the Rockefeller Dorado Estate in Puerto Rico. Cabo San Lucas is also under construction with 120 villas. Further afield, a Reserve designed as an old Arabian fort will begin construction this summer in Muscat, Oman.

After a year in operation, the Reserve in Krabi is starting to enjoy good return business. What Ritz-Carlton has found is that guests don’t like to move from the hotel and so the company has added on more dining venues.

While Reserve is designed with resorts in mind, Humler said there’s a location in Vienna, Austria, that could work well. “It’s a place where we could do 60 keys and it has a beautiful garden with no cars. It would work as a resort because you’re in an oasis downtown.”

Bulgari is another small brand that Humler oversees; recently, a property in London was announced that’s been under construction for a year. Next up is Tokyo, he said.

In the meantime, developing the core Ritz-Carlton brand is a huge priority. The company is about to open a new Hong Kong hotel at the end of this month, a milestone project that has been seven years in the making. Of note is the fact that it sits on the highest floors (102 to 118) of the International Commerce Centre, making it the highest hotel in the world. Guests can take in the views of Victoria Harbour from the observation deck on the 100th floor and from the rooftop bar on the 118th floor.

The hotel also marks the ninth in China for Ritz-Carlton, including two hotels in Beijing. There are two hotels in Shanghai and one in Guangzhou. Ritz-Carlton also has a business hotel in Shenzhen and a resort in Sania. Humler is hoping to finalize Macau “very soon.”

As far as the rest of Asia, Ritz-Carlton is in every capital city from Jakarta, Indonesia, to Kuala Lumpur and from Singapore to Osaka, Japan. “There are some great markets that I need to be looking at in Japan,” he said. “And there are some good resort destinations that we’re looking at.”
Humler has a great location in downtown Cairo, which he expects will start moving ahead soon. A second Ritz-Carlton just opened in Dubai, and plans are for a hotel in Riyadh, Saudi Arabia.

As for Europe, Ritz-Carlton has development offices in Zurich and London. It doesn’t have the license to open a hotel in Spain, Portugal, London or Paris, but it’s had the Hotel Arts in Barcelona for years. It also operates Penha Longa Hotel and Golf Resort in Portugal. In Paris and London it uses the iconic Ritz hotels as partner properties.

“I wanted to make sure we have that relationship with them and one day, if they change their heart, we’re here to manage the hotel,” said Humler, “or as much as we can if we can steer our customers to use them. That’s why we have them in our marketing agreement, that’s why we have them in the Ritz-Carlton website for reservations and so on.”

Humler has a list of other European destinations he’d like to be in, including Budapest, Hungary, and Vienna, projects that have been on hold. He told Hotel Management the company is looking at “some great European hotels” that may convert to Ritz-Carltons.

“Some [people] in Europe who are managing their own hotels with their own reservation system, and it’s time for them to turn it over. We are looking at some very high-end small luxury hotels right now in Germany and Switzerland and as well in Italy. A lot of them have been run independently for many years.”

In North America, Ritz-Carlton just opened a hotel in Toronto. Humler said he’s starting to see some activity pick up again in that region “but the biggest issue today is financing.” He sees opportunity in California.

On the horizon, Ritz is putting a hotel in Aruba (contracts are signed and construction should begin this summer). The company also has a project under construction in Panama City, and Argentina and Sao Paolo are in the works.

In Humler’s mind, there’s no doubt luxury hotel development will pick up. “People always want to go on vacation,” said Humler. “Traveling is not a want but a need.”

 

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