Managing a Boutique Hotel: Working with Less Means 'Getting to Know You'

By Jane Renton General Manager, Jumeirah Lowndes Hotel | August 03, 2010

Industry pundits tell us that the appeal of boutique hotels is based on good location, distinctive character (physical as well as emotional), personalized service and perceived value. It would appear that these are qualities that resonate with today's consumers who increasingly seek "experience" in whatever they do, whether it is a museum with interactive learning experiences, a resort stay where they learn to Scuba, ski or knit, or a shipboard program of lectures, seminars and cultural performances on their Mediterranean or Caribbean cruise. Across all price points but particularly at the high end, consumers expect, or at least wish for a hotel that is more than a bed in a room. And the expectations go beyond state-of-the-art communications technology to those more difficult to quantify or even define qualities such as "ambience," "character" and "personality."

As a manager of a boutique hotel, however, there are limits on what can actually be "managed." The location - good or bad - is a given; you live with it, in the case of the latter, or revel in it - make it an integral part of the guest experience - in the case of the former. Indeed, those of us blessed with ideal locations strive to make the hotel synonymous with our neighborhood. Our branding, our marketing strategies, focus as strongly on the guest experience beyond the hotel doors as they do on the character within. The hotel becomes a friendly and welcoming character in the neighborhood, for out of town guests as well as area residents.

Facilities also are a given; you have what you have. You turn your one restaurant into a neighborhood favorite and you seek ways of providing customers with access to other facilities. That might mean complimentary membership in a local health club, a dine-around program or partnerships with area facilities that can provide unique meeting or special event spaces. Boutiques that are members of a portfolio that includes larger properties nearby, of course, have a special advantage in being able to make those facilities conveniently accessible.

Short of total renovation, there are limits to what a boutique hotel's manager can do with a property's physical character. The building, its architecture and style, its history, are what they are; they either warrant celebration - if there is a story to tell - or careful avoidance if the structure has little character or pedigree. There's great advantage to having the former because the hotel itself then becomes a personality that guests relate to. On the other hand, how many of us return to a hotel because of the architecture or history of the building?

Far more important than physical character, is the ambience of the hotel, the emotional character - the experience that the guest takes away with her, and remembers fondly and appreciatively. Here is where the unique challenges, and rewards, of boutique hotel management really come into play. This experience ultimately creates value as perceived by the guest, which, in turn, generates all-important customer loyalty. All segments of the industry strive for brand loyalty. For boutique hotels - which usually cannot compete with larger properties in terms of facilities, size, pricing structure, including discounting - the repeat customer is absolutely essential.

The first talent a boutique manager needs is the ability to recognize and reach those customers - the optimal demographic markets that will provide loyal guests. Who are the travelers most likely to be captivated by your unique character? Most urban properties probably do 60 percent or more in corporate, mid-week business; who are these people? What about you appeals to them? Many boutique hotel companies report that 20 percent or more of their business is in small meetings and conferences. What are these meeting planners and corporations looking for in a boutique?

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Coming up in March 2018...

Human Resources: Value Creation

Businesses must evolve to stay competitive and this is also true of employment positions within those organizations. In the hotel industry, for example, the role that HR professionals perform continues to broaden and expand. Today, they are generally responsible for five key areas - government compliance; payroll and benefits; employee acquisition and retention; training and development; and organizational structure and culture. In this enlarged capacity, HR professionals are no longer seen as part of an administrative cost center, but rather as a member of the leadership team that creates strategic value within their organization. HR professionals help to define company policies and plans; enact and enforce systems of accountability; and utilize definable metrics to measure and justify outcomes. Of course, there are always new issues for HR professionals to address. Though seemingly safe for the moment, will the Affordable Care Act ultimately be repealed and replaced and, if so, what will the ramifications be? There are issues pertaining to Millennials in the workforce and women in leadership roles, as well as determining the appropriate use of social media within the organization. There are new onboarding processes and e-learning training platforms to evaluate, in addition to keeping abreast of political issues like the minimum wage hike movement, or the re-evaluation of overtime rules. Finally, there are genuine immigration and deportation issues that affect HR professionals, especially if they are located in Dreamer Cities, or employ a workforce that could be adversely impacted by federal government policies. The March Hotel Business Review will take a look at some of the issues, strategies and techniques that HR professionals are employing to create and sustain value in their organization.