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InfoWeb Marketplace · Editorial team
Published on 12 October 2022 · 5 min read
The Evolution of Luxury Hospitality
InfoWeb Marketplace · Editorial teamPublished on 12 October 2022 · 5 min read
Hoteliers, often owner-operators and founders of collections of properties in France and abroad, are embracing the codes of luxury, redefining them around values of their own and meeting the expectations of guests who often did not see themselves in the existing offering. Les Domaines de Fontenille, Millésime, Beaumier, Experimental Group, Evok Collection, Maisons Pariente, Les Hôtels (Très) Particuliers... these hotel collections, with their different products and DNA, share the desire to host guests differently. Beyond star ratings, services and location, it is often the experience and the creation of emotions that take precedence in these operators' definition of "luxury". Halfway between the classic, codified product and the trendy product, the Les Domaines de Fontenille collection, created by Fréderic Biousse and Guillaume Foucher, illustrates one of the many approaches behind these new positionings.
The development momentum of these collections since the early 2010 illustrates guests' appetite for products that redefine the codes. In 2022 and 2023, several openings are planned to complement existing hotel portfolios that have grown rapidly in recent years.
A few examples:
- the opening of the Grand Mazarin by Maisons Pariente is planned for autumn 2022 in Paris. This property will complete the collection with a more urban destination;
- Millésime plans to open its new house within the Château de Théoule-sur-Mer in 2023/2024;
- after 6 properties, Evok Collection continues to expand internationally and plans to open the Nolinski Venezia in Venice in 2022, and the Brach in Madrid in 2022 and in Rome in 2023;
- La Maison du Val, a property in Saint-Germain-en-Laye, joined the portfolio of the Les Hôtels (Très) Particuliers group in 2021.
Among the latest news, the Beaumier collection (owned by KSL Capital Partners since 2019, which also holds stakes in the upscale hotel collection "Pig Hotels" in the United Kingdom) announced in 2022 the acquisition of three properties in Verbier as well as a hotel in Ibiza. Illustrating the success of this new approach to luxury hospitality, Experimental Group announced a fundraising of ?380 million to finance its development, with several acquisitions already announced, including one in the Cotswolds region in the United Kingdom and two in Biarritz with Le Régina and Le Garage.
"Affordable luxury" at Les Domaines de Fontenille, "Another luxury" at Millésime, "Simple and warm luxury" at Maisons Pariente... Through these different approaches and definitions, diverse positionings are emerging, meeting the expectations of varied clienteles and generations. Some hoteliers, such as Evok Collection, also offer different brands in response to the varied desires and worlds of their guests: "a lifestyle for a style of luxury". Luxury is classic at the Nolinski, exclusive at the Hameau de la Volière, the Palais Royal Restaurant and the Cour des Vosges, relaxed at the Brach and offbeat at the Sinner.
Storytelling is woven into every component of the product and the guest experience, from the choice of destination to the selection of materials, including decisions on staff dress style... A pillar of brand image, this art of telling a story is key to the gradual, organic creation of a community of loyal customers. Beaumier group in particular works with a creative agency, Le Studio Saint-Lazare, to "give meaning to spaces, identities and visual stories", while at Millésime storytelling also takes shape on a daily basis.
Working on storytelling for each new destination makes it possible to develop a distinct identity for each property, which then has its own image and communication despite belonging to a collection.
Precise sourcing of opportunities, often with the aim of settling:
- in places with a soul and a story to tell: Catherine Deneuve's former home for the Domaine de Primard, a former postal sorting center for the Brach in Paris, the Convent of the Visitation in Nice for the upcoming opening of the Perseus in France, the former property of Sir Reginald Wright for the Château de Brindos...;
- but also in destinations consistent with the brand's identity and its clienteles, to offer them new experiences, off their usual paths or precisely where they like to travel and go out. Some therefore choose to expand exclusively in urban destinations, like Evok Collection, which is starting the international expansion of its brands (openings planned in Italy and Spain), while others set out to conquer little-explored territories and experiential destinations, like the latest property of Les Domaines de Fontenille on the Île d'Yeu, Les Hautes Mers (opened in 2022).
Particular care is given to decor, with properties often designed by interior architects who contribute to the hotel's image and commercial success (Jaune Architecture, Festen, François Vieillecroze...), sometimes even becoming part of the brand's story, like Dorothée Meilichzon, who designs most of the Experimental Group properties. Other hoteliers prefer to create a decor in their own image. The founders of Maisons & Hôtels Sibuet, pioneers of this collection hospitality, also strive to offer places where "you feel at home", through the choice of furniture sourced by the family, for example. FF&E amounts often reflect the attention paid to decor, which often allows a natural over-positioning of the products when they enter a new market. A developed and constantly renewed events program, sometimes led by an Artistic Director, also helps build customer loyalty and gain visibility among locals. The Château de Brindos (opened in 2022 - Millésime) has developed "Les Rendez-Vous de Brindos, Lac & Château" with, for example, mixology classes, concerts, fashion shows, brunch with a DJ, etc. The Brach in Paris offers Master class Workshops and Immersion Workshops that reveal "the well-kept secrets of the Brach's Chefs and Mixologist", who are keen to share their know-how, or let guests join a Chef's brigade and immerse themselves in the atmosphere of a service.
Illustrating their commercial success, these properties often manage to post average price levels decorrelated from market ratios, over-positioned against their traditional competition, particularly in destinations where products have changed little. At the same time, the codes of distribution are also being redefined. With a loyal clientele eager for new openings, hotel collections benefit from a unique sales force, which optimizes their direct sales (representing up to more than 70% of bookings for some operators). The rate of repeat guests accounts for more than 50% of revenue for some properties. For example, some properties report food and beverage revenue of up to 50% of total revenue, whereas the average for the 4/5* hotel sector with a restaurant ranges between 20 and 35% depending on the property. These complementary flows also help optimize margins on activities that are not very profitable in hospitality. Thus, with high average price levels, loyal clienteles and diversified revenue sources, the industry's traditional ratios and benchmarks for a virtuous business model (large-capacity hotel, limited food service, etc.) are being challenged. Gross Operating Profit levels are often strong, reaching up to 60% of total revenue for some hotels.
Information from the study ?The French Hotel Industry in 2022? conducted by KPMG SA
Success stories that illustrate hotel guests' expectations for this new luxury
The development momentum of these collections since the early 2010 illustrates guests' appetite for products that redefine the codes. In 2022 and 2023, several openings are planned to complement existing hotel portfolios that have grown rapidly in recent years.
A few examples:
- the opening of the Grand Mazarin by Maisons Pariente is planned for autumn 2022 in Paris. This property will complete the collection with a more urban destination;
- Millésime plans to open its new house within the Château de Théoule-sur-Mer in 2023/2024;
- after 6 properties, Evok Collection continues to expand internationally and plans to open the Nolinski Venezia in Venice in 2022, and the Brach in Madrid in 2022 and in Rome in 2023;
- La Maison du Val, a property in Saint-Germain-en-Laye, joined the portfolio of the Les Hôtels (Très) Particuliers group in 2021.
Among the latest news, the Beaumier collection (owned by KSL Capital Partners since 2019, which also holds stakes in the upscale hotel collection "Pig Hotels" in the United Kingdom) announced in 2022 the acquisition of three properties in Verbier as well as a hotel in Ibiza. Illustrating the success of this new approach to luxury hospitality, Experimental Group announced a fundraising of ?380 million to finance its development, with several acquisitions already announced, including one in the Cotswolds region in the United Kingdom and two in Biarritz with Le Régina and Le Garage.
Distinctive products for diverse hotel clienteles
"Affordable luxury" at Les Domaines de Fontenille, "Another luxury" at Millésime, "Simple and warm luxury" at Maisons Pariente... Through these different approaches and definitions, diverse positionings are emerging, meeting the expectations of varied clienteles and generations. Some hoteliers, such as Evok Collection, also offer different brands in response to the varied desires and worlds of their guests: "a lifestyle for a style of luxury". Luxury is classic at the Nolinski, exclusive at the Hameau de la Volière, the Palais Royal Restaurant and the Cour des Vosges, relaxed at the Brach and offbeat at the Sinner.
Storytelling, creativity and identity: key success factors in hospitality
Storytelling is woven into every component of the product and the guest experience, from the choice of destination to the selection of materials, including decisions on staff dress style... A pillar of brand image, this art of telling a story is key to the gradual, organic creation of a community of loyal customers. Beaumier group in particular works with a creative agency, Le Studio Saint-Lazare, to "give meaning to spaces, identities and visual stories", while at Millésime storytelling also takes shape on a daily basis.
Working on storytelling for each new destination makes it possible to develop a distinct identity for each property, which then has its own image and communication despite belonging to a collection.
Precise sourcing of opportunities, often with the aim of settling:
- in places with a soul and a story to tell: Catherine Deneuve's former home for the Domaine de Primard, a former postal sorting center for the Brach in Paris, the Convent of the Visitation in Nice for the upcoming opening of the Perseus in France, the former property of Sir Reginald Wright for the Château de Brindos...;
- but also in destinations consistent with the brand's identity and its clienteles, to offer them new experiences, off their usual paths or precisely where they like to travel and go out. Some therefore choose to expand exclusively in urban destinations, like Evok Collection, which is starting the international expansion of its brands (openings planned in Italy and Spain), while others set out to conquer little-explored territories and experiential destinations, like the latest property of Les Domaines de Fontenille on the Île d'Yeu, Les Hautes Mers (opened in 2022).
Particular care is given to decor, with properties often designed by interior architects who contribute to the hotel's image and commercial success (Jaune Architecture, Festen, François Vieillecroze...), sometimes even becoming part of the brand's story, like Dorothée Meilichzon, who designs most of the Experimental Group properties. Other hoteliers prefer to create a decor in their own image. The founders of Maisons & Hôtels Sibuet, pioneers of this collection hospitality, also strive to offer places where "you feel at home", through the choice of furniture sourced by the family, for example. FF&E amounts often reflect the attention paid to decor, which often allows a natural over-positioning of the products when they enter a new market. A developed and constantly renewed events program, sometimes led by an Artistic Director, also helps build customer loyalty and gain visibility among locals. The Château de Brindos (opened in 2022 - Millésime) has developed "Les Rendez-Vous de Brindos, Lac & Château" with, for example, mixology classes, concerts, fashion shows, brunch with a DJ, etc. The Brach in Paris offers Master class Workshops and Immersion Workshops that reveal "the well-kept secrets of the Brach's Chefs and Mixologist", who are keen to share their know-how, or let guests join a Chef's brigade and immerse themselves in the atmosphere of a service.
A success that is not just marketing: products that redefine the business models of upscale and luxury hospitality
Illustrating their commercial success, these properties often manage to post average price levels decorrelated from market ratios, over-positioned against their traditional competition, particularly in destinations where products have changed little. At the same time, the codes of distribution are also being redefined. With a loyal clientele eager for new openings, hotel collections benefit from a unique sales force, which optimizes their direct sales (representing up to more than 70% of bookings for some operators). The rate of repeat guests accounts for more than 50% of revenue for some properties. For example, some properties report food and beverage revenue of up to 50% of total revenue, whereas the average for the 4/5* hotel sector with a restaurant ranges between 20 and 35% depending on the property. These complementary flows also help optimize margins on activities that are not very profitable in hospitality. Thus, with high average price levels, loyal clienteles and diversified revenue sources, the industry's traditional ratios and benchmarks for a virtuous business model (large-capacity hotel, limited food service, etc.) are being challenged. Gross Operating Profit levels are often strong, reaching up to 60% of total revenue for some hotels.
Information from the study ?The French Hotel Industry in 2022? conducted by KPMG SA
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