BTN Europe presents an overview of business travel and MICE predictions for this year
Thursday 9th September, JW Marriott Grosvenor House
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Jan D. Goessing is General Manager of the Mandarin Oriental, Bangkok.
How are things in Bangkok at the moment?
The situation is wholly unpredictable. If I knew how things would turn out I would be a fortune teller or a rich man. It is unprecedented, but having said that, in our industry many things are unpredictable and we have to make assumptions and show we are prepared for emergencies and we manage our business according to the current situation. Long term planning is out of the window, so we try to be intelligent about the information that is available and converting that into our day to day operations.
What sort of measures can you take?
We focus on what truly makes a difference in a hotel like this such as safety and security for both the guests and the employees and proactively communicate with guests on property and those about to visit as well as with our travel partners so they get a first hand impression from us on the ground rather than just from the television and the newspapers. The media have their own view on this and they focus on the hotspots in the city and make it look as though the whole of Bangkok is affected and at the moment that is not the case. If I did not read the paper I wouldn't know there was anything going on because I have seen none of it so I'm being informed the same way the world is, but I know it's not the entire city that is under siege. It is very isolated. In our location we have not been affected by these demonstrations whatsoever, except in terms of the volume of cancellations and the slow-down in business which has affected everyone in the city.
So how do you plan your business at times like this?
We actualise our forecasts and business predictions on a weekly basis but clearly it is extremely difficult. Once a week the revenue managements team at the hotel gets together and evaluates the latest information - bookings against cancelations, and so on and we update the information but no matter how much time you put in this sort of exercise events change
How can you encourage people to visit you? Is this the time for marketing or discounting?
I don't think it's the right time for marketing now, no. I don't think people would believe us even if we told them the truth about the situation here. As far as discounting goes, I don't think heavy discounting would necessarily build significant occupancy levels. We have a 135-year history here and it has been the number one hotel for decades and by some margin. The hotel has the most loyal following of guests that I've seen at any hotel, and this is my fifth Mandarin Oriental. We build relative rev par performance even in difficult times as was proven last year or when the airport was closed, this hotel outperformed the competition, principally because of the loyal leisure following. Most of our competitors are more reliant on group business and corporate business and those two segments completely collapsed. The leisure business was weakened, but this hotel is still the exception. Our clients are resilient and are willing to ignore what they are being told to still come and stay here and not just for a few days, but for a week or two weeks. It is what makes this hotel get through these periods, so we don't see the need for discounting, and in any case I really believe Bangkok offers incredible value compared with other cities.
Where do your guests come from?
Mostly from Europe. Our number one market is the UK, number two is Germany, then the US and then Asia, which is always very badly affected by events such as we are seeing now. The same travel advisories are in place from most countries, but different cultures reach in different ways with some being more stringent and absolute than others. The European market is much more resilient - they seem to be more willing to override these travel advisories and still travel.
What builds loyalty like that? And as the general manager how do you improve the hotel?
The value you bring is sticking to the traditions of the hotel, but ensuring [the hotel] has relevance in the future. The traditions are so strong, it would be foolish to touch them, and that's things like the weekly cocktail reception, the general manager parties where we have guests changing their travel schedules in order to be able to attend. These parties are not just meet or greet, they are elaborate receptions and usually last for two to three hours and create a bonding between the guests and employees, and between the guests themselves. We also have guest recognition events when guests who have stayed with us a number of times are invited to a dedicated party where employees and members of the management team celebrate their loyalty. There's also the quite stringent dress code, which is part of the tradition of the hotel and is appreciated by the majority of guests. It elevates the experience, though it's not for everyone.
In Hong Kong you have both the Mandarin Oriental and the Landmark Mandarin Oriental for a younger generation of guests. How will you continue to attract new guests to your Bangkok property?
It's a question we are asking ourselves now and we are trying to address it through our capital expenditure programme. We need to find a balance and a way for the next generation to find the value in the hotel that the current generation has appreciated so much. So, we will add some F&B offerings that are maybe hip or more attractive to a younger generation. Also, we are discussing the possibility of adjusting the renovation programme so a section of the hotel would have a different design which would be more appealing to a younger generation. We are also working on enhancing our health and wellness offering, and the environment is very important as well - demonstrating that we care about the environment, that we are looking after those aspects in a very proactive way. What's very interesting is that the older generation has introduced the younger and we have seen the kids of these families grow up here over the years, so it's a mix of a number of things but we are very conscientious about it.
We will continue to pursue several capital expenditure projects and so far we have received full support from our owners not to fall into the trap and believe in cutting costs for short term benefits. This hotel continues to employ 1300 employees for 400 rooms and we continue to have the same floral arrangements in the lobby, the same amenities in the rooms and we are not making any adjustments that are reducing the guest experience. You can only do that with incredible support from the owners, of course, but that's how it is here - they are taking the long term.
So no cutbacks in staff?
We are in the people industry, and this hotel has reminded me that everything should start with the staff that the hotel has. It's all about the people you employ and the tools you provide them with and the way you motivate them. That will ensure the guest experience will be a positive one and so and ensure success. This hotel is second to none in looking after its employees. They are our most significant asset and if we care for them and look after them they will care for our clients and ensure we have a successful business. It's tempting to computerise and depersonalise everything, but I can see here now that nothing beats personalised and dedicated service. It's amazing for me as a manager to see these people at work. We are doing guest surveys like many other companies and on a scale of 0 to 100 this company runs at 98.5 per cent, which in this environment is truly remarkable.