Phil McAveety, Starwood Hotels and Resorts Worldwide’s executive vice president and chief brand officer, muses on trends in design and technology, and what it all means for the guest...
You are Starwood’s chief brand officer – what does that mean?
I look after the whole portfolio of brands. It covers anything the consumer touches at the nine brands, from the reservations process through the experience at the hotel to after guests have left the hotel. The idea is we want to be consistent in how we present ourselves to customers, whatever the touchpoint. We look at ourselves as a lifestyle brand company – each of our nine brands is a lifestyle brand, in that each is focussed on delivering against a consumer need.
For example, at Le Meridien our inspiration is what we call the creative guest, someone who is interested in arts and culture, and we build our programming and design around that. We form relationships with art institutions and art curators. It’s a different connection point. In London we have a partnership with the Tate Modern, as our local institution. In Barcelona it’s the Museum of Contemporary Art.
In our St Regis brand, which is our most traditional luxury brand, our inspiration is the connoisseur. It’s someone who really is used to the best, and frankly is used to paying for it. Our foundation is butler service, and our goal is to deliver beyond expectations.
I understand Starwood is currently working on repositioning the Sheraton brand – can you tell me about that?
For Sheraton, which is our biggest and most international brand, we’ve been really investing in reenergising that brand in the last three years or so. We’ve invested $6 billion in real estate, new openings and renovations. Given the nature of Sheraton, with more than 400 hotels in 75 countries, it has a lot of history. It was the first international brand into China, the first international brand into many South American markets. That heritage has stuck with us, so one of the things we’ve really come to respect about the Sheraton brand as we interrogated it was that it spans generations, because it has been around a long time. Also when you have 12,000 weddings a year in Sheraton hotels around the world, but you’re also hosting the G20 summit, it’s from world events to life events. We’re building our positioning around Sheraton as the idea that it’s the world’s gathering place.
Do you view it as the core business traveller option?
It’s definitely the core business traveller option, but as you go international we have a wide range of Sheraton resorts, particularly in Asia where it is considered the gold standard.
Have you seen travellers returning since the upturn in the economy?
Luxury travel came back quicker than the other segments of travel. Travel all came back pretty quickly. Luxury came back quicker than other parts of the business and within the luxury segment across all categories of product, travel actually did better than watches and fashion. It said to us that people really value their travel experience, but one of the changes we’ve noted is that people want to understand what you stand for. They want the fancy watch, but it’s not about a badge. What they want to be able to say is 250 years of Swiss craftsmanship. They want the backstory, as opposed to look at my watch.
In the hotel business as we really think about developing our brands, it really is, for example with the W, having a real connection with fashion and music. You need to be a collaborator as opposed to a sponsor. With St Regis it’s about the authentic heritage of the brand, with people really understanding it is about bespoke service to the highest quality. It’s made us even more focussed on making sure we’re delivering an authentic experience and true connections.
At the same time, as the world becomes more and more global, you see the same brands everywhere. The flip side of that is as things become more and more global, people are looking for a local connection. People don’t want to fly for 12 hours and feel they never left Kansas. If I leave New York and I come to London, I want to feel like I’m in London. A lot of the design that we’re bringing together with our brand DNA is around respecting the local culture, so that people feel a sense of location.
How is technology changing the way Starwood positions itself?
The digital platform is important, particularly the personal. We’ve moved our marketing online almost exclusively now, I’d say. When you look at the travel space, most people will go online. If you’re going to Buenos Aires for a holiday you might look at an ad. It’s unlikely. But you will go online and start researching. We really divert our resources to making sure we have an online presence.
In the last two or three years that has evolved again, given the introduction of social media. It’s a real phenomenon. If you have one or two friends that have been to Buenos Aires, you’re going to ask them. You might not know anyone. When you have an extended social network, you can ask friends of friends. We find that is a much more trusted source. Engaging in social media is really important. From a marketing perspective it has really changed how we go to market, and how we position ourselves.
Then there is how technology is impacting the hotel experience itself – how can my ipad or my phone add to the hotel experience. This is something we’re building a lot on now. Technology is touching a whole bunch of areas, from reservations to entertainment, to functions like opening doors and ordering room service. It’s going to take a lot of focus and a lot of investment.
Also, we don’t want to forget that all people aren’t the same. If they were it would be a pretty dull world. For example, if my travel experience means I don’t have to talk to another human being until I want to, then I’m really happy. There are other people who want that interaction. So technology is interesting in that it is quite polarising.
There’s always that balance in every consumer trend. As people get worried about health, sales of premium chocolate and ice cream go up. It’s one of those great marketing quandaries.
What about the next generation coming up – those who have grown up with computers and the internet? What is Starwood preparing for them?
There are a lot of different things that influence all generations. Part of it is that technology for technology’s sake is irrelevant. Most of them don’t even think of it as technology. It’s an enabler. That’s how they consume content, that’s how they communicate, that’s how they entertain themselves.
People often say that Apple is the most innovative company in the world. In a lot of ways they are not. What they’re brilliant at is packaging. They didn’t invent the MP3 player, but they marketed it and gave it a personality. Design and technology go hand in hand. As we start thinking about making sure we have a connected environment, we also want to package it up in the right way.
Aloft is one of our newest brands and talks directly to this Generation Y consumer who has grown up with design, whether it’s the iPod, You Tube, or Ikea. Ikea make cheap and cheerful furniture that is actually pretty well designed when you put it up. Whereas design used to be something that you had to almost graduate to – I’m going to stay in this kind of place until I earn enough money to stay somewhere nicer – this generation is pretty impatient. They want it all and now. Generation Y has grown up with travel and design. It’s not a luxury, almost.
Aloft has managed to take inspiration from the W to a modern contemporary space with a social setting and be really technologically connected, and at a good price. We’re opening our first Aloft in the UK at London’s Excel Centre on October 1, 2011.
How about the budget sector – will Starwood ever launch a low cost model?
We have nine brands that straddle luxury, design and what you could call mid-market. In the budget category we don’ t have plans right now, for a couple of reasons. One, you need to do an awful lot of those to get the same kind of revenue streams as from one of these. Also, to be respectful to the people that work in that business, it’s a whole different skillset, which we don’t necessarily have right now.
When the low-cost airlines came out, all the big airlines set their own up. But within three to five years they were selling them off, because they were operating a budget model with a premium overhead.
Equally the airlines have taken aspects of the low cost model and introduced it into their own operations. Do you think the same thing is happening in hotels?
Not necessarily, but I think there are some interesting innovators out there. If you look at Japan, there is a hotel there that has no employees. You arrive, put in your credit card and it spits out a key. You go in, the room is ready. When you leave you put your key back in the slot and it notifies a third-party cleaning company that you’ve left. You have to book online, there is no reservation centre. They have a little grab and go shop, which is also third-party. It works. It’s a whole different concept.
Which starwood isn’t ready for...
I wouldn’t say we’re not ready. I admire that, I just don’t think it’s appropriate. It’s just not somewhere we want to go.
You used to work for Camper. What are the similarities between hotels and shoes?
Someone I know once said many people will wear a hotel in the same way they wear shoes. I think that’s a nice analogy. At the end of the day it’s all about that idea of looking from the outside in. Whether it’s shoes, clothes or hotel rooms, you’re fulfilling a consumer need. If you constantly think about what it is the guest needs, in the same way as what the runner, the footballer or the camper shoe wearer needs. If you start with the guest, and then find out how you can deliver that, it’s the same process.
Before I was with Camper I worked for Nike. They’re working on programmes for running shoes where they can put RFID tracking into the shoe, so you can measure much more accurately how much you’re running, how many calories you’re burning.
Our guests might have a shoe that’s telling them how far and how fast they’re running and they’re able to check in to an airline and fly to the other side of the world without any paper. One of the things that I constantly bang on about – as I would being a brand guy – is that unlike the traditional hoteliers, our guests don’t live in the hotel world. They live in this universe of brands.