As international and domestic hotel groups work on beefing up portfolios to meet the needs of MICE clients, challenges such as brand consistency, unique offerings and talent shortage stand in the way.
BY SIRIMA EAMTAKO and KRISTIE THONG
Given the emergence of Asian markets in recent years putting them almost on par with matured economies, the demand for more rooms, leisure offerings and MICE facilities as well as strong competitors have pushed owners into making strategic decisions to attract and fight for business.
Chains such as Starwood continue to expand in key growth markets such as China and India, with senior director of sales and marketing operations for Asia Pacific, Nichlas Maratos saying these two countries will continue to fuel the chain’s Asia Pacific pipeline.
Also experiencing growth in emerging markets such as the Philippines, Sri Lanka, Indonesia and Thailand, Mr Maratos added that Starwood will be making its foray into Sri Lanka this year, while properties in Manila have been planned for 2016-2017.
Hilton Worldwide Asia Pacific head of sales, Dominic Sherry said the brand is set to more than double its current presence in Asia Pacific in the next few years, with currently 104 operating hotels in 18 markets.
“Driven by their sizeable populations and a growing middle class, markets such as China, India and Southeast Asia present immense growth potential especially for the six of our 10 award-winning brands with which we wish to growth further in the region, namely Waldorf Astoria, Conrad, Hilton, DoubleTree by Hilton, Hilton Garden Inn and Hampton by Hilton,” he said.
The first Waldorf Astoria property in Beijing can be expected in 2014, and in Bangkok, 2015. Conrad alone will be opening 11 new properties in the region, with maiden properties in Bangalore, India and Manila. Additionally, the newly-reformed Myanmar can expect a new era of tourism with a 300-room Hilton Yangon scheduled for 2014.
Domestic chains right on pace for growth
Thailand-based Dusit International has named 2013 as its year of expansion, announcing a major joint venture in China and a number of hotel openings planned.
Dusit group currently has a portfolio of 18 operating properties in Thailand (12), Philippines, UAE, Egypt and the Maldives and 10 upcoming properties in UAE, China, Saudi Arabia, US, India, Thailand and Kenya.
The decision behind the expansion was in part to ensure the legacy of its founder, Chanut Piyaoui, a pioneer in Thai hospitality, and to take the brand to more international locations, according to assistant vice-president of global sales, Dorinda Chua.
“It’s an exciting time for the brand as it grows internationally, and this growth works hand in hand with our MICE objectives. We try wherever possible to develop hotels and resorts that cater for the MICE market,” Ms Chua said.
Dusit plans to launch a new Dusit Meetings and Events brand later this year in recognition of the MICE market’s importance to the company’s business, and as it experiences accelerated demand especially from neighbouring countries.
ITC Hotels, a chain predominantly based in India, is venturing out of India for the first time – to Sri Lanka. Chief operating officer Dipak Haksar attributed the decision to a “growing number of tourists, association business and corporate investments, complemented with the political stability”.
ITC Hotels also has several projects in the pipeline, such as the Classic Golf Resort at Manesar, Gurgaon, ITC hotel Kolkata and ITC Kohinoor, Hyderabad.
“The growing demand for MICE business complemented with that of the business, as well as leisure demands in key metro cities and leisure hubs, have acted as catalysts in the building of these hotels,” he said.
MICE a reason for expansion?
While MICE is an important segment for many hotels, it is not the only factor to evaluate the potential for expansion.
Starwood’s Mr Maratos said airline networks, existing infrastructure and potential development are also taken into consideration.
TCC Hotels Group, one of the largest hotel owners in Thailand, has a portfolio of 46 hotels in the country as well as 14 in 10 other markets, of which Plaza Athenee and Imperial Queen’s Park in Bangkok are prominent hotels in the MICE market with large event facilities. In February, TCC signed a management contract with the Marriott International for renovation and rebranding of Imperial Queens Park to Marriott Queens Park, Bangkok.
TCC Hotels Group’s senior executive vice president Wayne Buckingham said the company’s expansion is based on opportunities to acquire assets in key locations at the right price, with the MICE market also playing an important deciding role.
“The MICE market is a paramount consideration for many hotels with large room availability as revenue from MICE makes up 20-35 per cent of the key MICE hotels’ overall occupancy.”
Companies have invested heavily to create consistent brand portfolios around the world, and the MICE segment cannot be ignored. Senior executives of MICE hotels have long recognised the importance of a customised approach and some brands have placed more emphasis on the service than others.
Sofitel, Accor’s luxury brand, has enjoyed a stronger MICE positioning with its InspiredMeetings programme.
“We saw an increase in the number of groups holding events within Sofitel Asia Pacific in the last four years, with approximately 15 per cent increase in growth year-on-year,” Sofitel Asia Pacific vice-president of sales, marketing and distribution, Stephane Laguette said.
Unlike brands that offer specific value-adds or price points, Sofitel emphasises on a “cousu main” or tailor-made approach.
“It translates into a permanent approach to deliver the unexpected within expert timing from professionally-trained ambassadors. Within the brand, ‘cousu main’ is a conceptual part of our daily briefing and hotel trainings. It is a new mentality, a daily exercise which is constantly improved on,” Mr Laguette said.
Thailand-based Centara Hotels and Resorts senior vice-president of sales and marketing, Chris Bailey, also believes in tailor-made solutions for MICE clients. With a portfolio of 58 deluxe and upscale properties in Thailand, China, Indonesia, Mauritius, Maldives, Sri Lanka and Vietnam, it outperformed other hotel companies on the Stock Exchange of Thailand in terms of RevPar (revenue per available room) due to what he believed was up-selling and a customised approach for MICE.
“It’s a hard work and it takes time to win MICE groups, but it’s a lucrative business. It is not just about room revenue, but all other revenues that come with it such as F&B,” he commented.
Fight for talent
Hotel companies rapidly expanding will need a large pool of talent to fill the myriad positions all over the world, but industry staff shortages at present paint a bleak picture.
Mr Sherry from Hilton said the brand is continuing to invest heavily in human capital and growing the talent required to manage expanded operations.
“This means that we need to anticipate our future human capital needs and implement a variety of career development initiatives to attract, train and retain talent,” he said.
With currently over 550 hotels in the region and more than 250 in the pipeline for the next three years, Accor has already announced it is on the hunt for 30,000 new employees by 2016. The main recruitment drives will be located in China, Indonesia and India, with a range of positions also available in Singapore, Thailand, Japan and Korea.
“The profiles we are looking for are mainly entry level staff for our Front Office, Food & Beverage, Kitchen and Housekeeping departments, which constitute the heart of our hotels,” senior vice-president of human resources in Asia Pacific, Patrick Ollivier said, adding that Accor is also recruiting talent for the sales, distribution, marketing, finance and HR teams.