ABTN speaks to Paul Harnedy, regional director for Barceló Hotels in the UK, about how the hotel group has fared since its UK launch in 2007.
Can you tell us a little about Barceló’s history?
Barceló launched in the UK with a 45-year lease agreement from the former Paramount Group of hotels on 21 UK properties, back in September 2007. As a company, Barceló is a family-owned worldwide hotel company that has been trading for some 79 years now.
What are the hotels like?
All of them are four star. We’ve got 21, from Troon up in Scotland to down as far south as the Imperial in Torquay. They’re all very individual hotels, acquired over many years from various different hotel groups. We’ve got some very historic properties like the Majestic in Harrogate, the Imperial in Blackpool and the Lygon Arms in Broadway, which used to be part of the Savoy Group – certainly as I was growing up and doing my training in the industry, they were hotels you aspired to work at. We’ve really got a good mix of leisure, business and event-led hotels. Our smallest hotel has 42 bedrooms in Bath, which is just on the outskirts of the city centre. And our largest is the Hinckley Island hotel which has 362 bedrooms in Leicestershire.
How did you go about rebranding the hotels and putting the Barceló mark on them?
Obviously the first thing we did was to make them look Barceló by introducing the brand name, which is put in front of all the hotel names – so we’ve retained the individuality of the hotels with their historic names. We obviously changed all the signage within the first four months of taking over the Paramount group and then over time we’ve introduced the brand standards that the hotels in Spain have in terms of toiletries, the Meet Barceló product. However, what we tried to keep was the individual character of each business. You’d know you were staying in a Barceló if you were in Edinburgh or Cardiff, but you’d know you were in the local area. We try to be part of the community and hold some of the local roots in each hotel.
How do you achieve that?
Through the food offerings, so menus will always feature some local produce, plus looking at how we can partake in the local community by supporting local charities, and how we refurbish hotels – instead of normal artwork we tend to put images of the local area in our hotels.
And do you have to go through the owner at all when it comes to the decision-making?
The properties are owned by a group called Puma hotels, so it’s one landlord in effect, but they’re not involved in the running of the business – that’s Barceló. It’s a full lease so its purely down to Barceló, there’s no interaction.
Are they suitable for business travellers?
We measure our business in three major segments – business travellers, meetings and events, and leisure. Every single one of our hotels has an element of the business travel market in it – even if you take our hotels on the coast, we still ensure the facilities and service are what would be expected by the business traveller, not just the leisure traveller.
What makes them suitable for the business traveller?
The room design – the space, the light, the internet access, just making sure that the rooms are comfortable and able to be worked in. Ensuring that there are business facilities on site, such as printing, photocopying and scanning. And making sure that while we do have great restaurants, we also offer home comforts in terms of menus and quick and easy food in bars and lounges for those business travellers that want to work and eat at the same time. Business makes up just short of 40% of our mix, not including meetings and events.
Can you tell us about your loyalty scheme.
It’s points based, per night, so it’s a very simple scheme. We talked to our customers before we introduced it – you can overcomplicate these things at times. You earn points and we convert those into shopping vouchers for you. We offer an incentive to convert them into Barceló gift vouchers, therefore you can buy a night. What we find very popular are the shopping vouchers. We introduced that towards the beginning of last year, back in 2010.
It is proving popular in key locations like Basingstoke, Oxford and Cardiff, because they’re more city-centre business-driven hotels. We are currently reviewing our UK scheme alongside our European scheme as we have partnership schemes running in mainland Europe, so we’re talking to them about how we can take advantage of that – watch this space. It’s a UK-only scheme currently, but has the potential to be opened up.
Do you have a separate scheme for business travellers?
We have Barceló awards for agents, bookers, and one for guests. They all run very similarly, so we’re rewarding each party involved in generating the business. Last year we introduced the one for the guests, to make sure the end user is being rewarded, not just the booker. If you look at the major groups in the UK they reward the actual person staying in the hotel and obviously we wanted to ensure we were honouring that also.
Do you offer wifi?
Yes, it’s in all our hotels. We had it prior to 2007, but since Barceló came in we introduced free wifi throughout our public areas – you still have to pay in the room. We are currently looking at making it free everywhere, but obviously we work with a provider and when those terms are up for renewal we’ll discuss the possibility of introducing it free into the bedrooms. Towards 12 months from now. The key for Barceló was to make sure there was a free element within the building.
How much investment has there been since Barceló took over?
In terms of Barceló investment since 2007 they’ve invested £17m, not all of that the customer sees, what we’ve been very careful to do is ensure things like heating, hot water, all the basic elements were spot on and up to the 21st century – obviously we’ve got some old buildings and we want to make sure the infrastructure is right. While we have spent a lot of money at front of house, we spent a lot back of house to make sure they get the best service possible in terms of amenities. We’re also introducing new hot water and heating systems and when we do that we put the most environmentally-friendly systems in place. It’s difficult in the older buildings but where we can introduce more energy efficient ways of using power then we do so.
In terms of refurbishment we’ve done our bedrooms in Stirling over the last three years, and bedrooms at our hotel in Bath (Barcelo Combe Grove Manor Hotel), just to name two. We’re only three years into a 45-year deal. This year we have plans for looking at bar and lounge areas – we’ve done Cheltenham and Basingstoke this year, and we have further plans to do the lobby, lounge and bedrooms at Cardiff.
We’re also continuing to roll our flat screen TVs in all the properties – we’re at about 70% right now, so we’re finishing that this year. In addition, we are currently in talks with contractors about upgrading some of our bedrooms in Cheltenham and wherever we can we’ll be looking to add additional bedrooms to the current infrastructure of the hotels – to look at converting unused space.
Does investing in your current properties take priority over expanding the portfolio?
Yes, we are investing in the current properties we have. There is a real desire to invest in London. I can’t sit here and give you an update on that other than it is something we’re working hard on and we hope to get a hotel in London very soon. Certainly over the next three years we would hope to enter the London market.
What are your plans for future investment?
We’re probably looking at spending £4 million a year for the next three years. We want to make sure we invest in our service delivery. Shiny products and bedrooms are one thing, it’s the service element that can differentiate us from our competitors. We’ll have a focused team of people who are on the road training
and launching new initiatives. It’s about ensuring our teams have not just the training but also the tools and resources to be able to deliver.
This year we’ve introduced more analysis of our customer feedback, we’re using an external agency to do all our guest feedback this year. We get that on a daily, weekly and monthly basis. It’s real-time information of what our customers experience in our hotels.
We also work very closely with the AA as we’re trying to attain a rosette for restaurants in each of our properties – Oxford recently got one, and we got our second rosette in Troon in Scotland. We have a number of properties with them now and we continue to work on that. We’ve set ourselves a target of three years to have a rosette in each of our properties.
Barceló acquired the UK properties at the start of the recession – how did you survive that as a company?
It’s fair to say it was tough, if anybody says it wasn’t they’re lying. But when you get through tough times your best people shine. We approached the market as a united team, we were all in it together and we worked very hard, especially on the customer service side, ensuring our existing customers continued to use us – the market was very competitive. We also introduced the rewards programme in our meetings and events segment, and introduced the Meet Barceló brand.
What we tried to do was look at each revenue generating area of the business and make sure we deliver above and beyond the cost expectation. We’re working a lot harder to win the business. Instead of reducing the number of people in our sales team we have continued to increase the number, so that we’re out there on the road in front of the customers talking about what Barceló is and what we can do for them.
So did the customer become the most important element?
Yes, we’ve got to understand what our customer thinks of us and what their needs are. The unique thing about going into the downturn as we did was we had something to talk about. We were a new brand, fresh in the UK, so we needed to build loyalty and that’s what we’ve been doing for three years, but we actually had a news story – we arrived in the UK and introduced all these various things over the past three and we will continue to introduce new products going forward.
Did you lose any corporate deals as a result of the recession?
I think we lost some, because some competitors were dropping prices far more than we were. It certainly became more competitive out there. We held firm on a few, we did lose a few accounts but I’m pleased to say we picked up quite a few as well. The fact that we had that sales presence in the marketplace and this new brand to go out to market with helped.
And how is business faring this year so far?
In the first few months of this year we’ve seen an improvement in our business traveller market – the number of rooms sold has definitely increased.