2019 – The death of the corporate hotel?

Turn on the TV, check out the adverts at major transport hubs, scan the latest articles, and it’s pretty likely you’ll spot at least one advert from a longstanding stalwart of industry. I needn’t name them, but you know them – the big corporate engines with hotels across the globe and a particular signature that secures them the loyalty of their regulars, whatever the location.

We assess and mystery shop quite a few and there are those which are succeeding not only in staying on brand, but have also earned their top spots as global trademarks, delivering a consistent expectation and level of service to their guests and investing in prime locations to capture the attention of the transient traveller too. Yet, in the age of user-generated content, online reviews, third-party booking engines and hotel comparison sites, do the hotels even need their brands anymore and are they really delivering on their promises?

A recent business trip to Newcastle saw me stay at the best corporate hotel in the area. Or rather what used to be the best hotel. In the 90’s, the hotel was in its heyday; it was the best brand hotel in the region, a good four-star level, suited to most corporate budgets, had great customer service, fantastic facilities and was a sought-after provider for leisure and corporate travellers alike.

It was a little bit of an eyesore in its early 70’s building, but it was properly ‘sparkle washed’ i.e. they managed to get away with it. 30+ years on and frankly, it is just sad. The lobby smells of chlorine, the restaurant is a small segmented corner of a function room – how did they get away with that, with panache in the 90/00’s – the bar area is scruffy and the rooms, while comfortable, still have the same built in (but solid wood) desk/wardrobe combo and bed/bedside table set up. It even has the prerequisite two chairs and table to eat at – the common standards have a lot to answer for here in terms of creating soul and character-less product, but that’s a topic for another article.

Even setting aside the décor and building – I appreciate sometimes budgets and priorities are restricted – the soulless, poor quality theme continued. Practices were outdated, and I was pushed to pay for wifi or join the loyalty club; then when I did, the process didn’t even match up as I still had to wait at checkout for them to apply the loyalty club discount and reverse the charge. Anything but slick. Ultimately, it’s all very morose, particularly given its previous status, but it also got me thinking.

This hotel is one of many owned by the brand and the brand is deservedly well-respected and is actually great quality… most of the time. What’s happening though is that these brands are becoming behemoths that try, but fail to translate the ‘head office’ offering at an individual hotel level. It begs the question – is this the beginning of the end for corporate hotel models or will we see a resurgence and improvement as technology gets better and teams get savvier?

You might think I’m being harsh, but it’s far from an isolated case. I’m currently pursuing a complaint where the head office is telling me the claim is not valid because ‘I didn’t give them the opportunity to get it right’. An interesting approach to customer service – whatever happened to the customer’s always right – but in this case is also groundless as you’ll see from my experience. I entered my hotel in central London; a hotel which it turns out thrives almost entirely on its location and not on the realities of its staff or furnishings.

The lift was broken and the state of the walls demonstrated that repairs and renewals are clearly low priority, meanwhile the fried food menu and high drink prices are all designed to take as much money as possible off its guests. Not that I am averse to commerciality – in fact I encourage it heavily with our members – but when it affects customer service and seems to be a culture of the property, I take issue with it

I’ll forgive them for the lift not working – I can ‘understand’ that as this wasn’t a full service property; but I also think there is a basic need to compensate when something has gone wrong i.e. a porter for your luggage; whoops they don’t have porters; OK get the bar / maintenance/ reception team to help? No, just me? The room however was something else. Without being too graphic, a previous guest had clearly been unwell and had been ill by the bed and by the desk. Housekeeping had cleaned up the mess, and then they, or perhaps someone more senior, had decided to try and re-let the room without adequate deep cleaning.

The windows were open hoping to disguise the smell, the heating was on full blast to try and dry the carpet and it wasn’t immediately obvious there was a problem. I’d been there long enough to dump my suitcase, assume the smell was coming through the open window and decide the heating needed to be turned down, before departing for an event. Returning hours later, at just before midnight, I realised the carpet was wet, the smell was coming from inside the room and the windows had been open for a reason.

Suffice it to say, it was one of the worst experiences of my entire traveling life. The room wasn’t great anyway, cleanliness was an issue, the sink was very poor and had been for a long time, but never before have I had to put shoes on to cross the room from bed to the bathroom, because of wet, unclean carpet, nor could I use the tea and coffee tray or desk without having to hover over the smell and wonder if everything was really clean. Why did I not move then and there? Well they didn’t offer, although interestingly they now say they did, and the hotel was fully-booked.

They did offer to send someone to my room, which occurred to me as pointless, and I remain astounded that at least one of their staff members had left it that way in the first place? They also invited me down to the desk but again, the hotel is fully booked? Plus I ruled out moving hotels, because I was tired, I couldn’t be bothered to repack, I was really cross – a mistake I won’t ever make again.

In hindsight, I probably should have requested an alternative room – it would have been a test to see if this defensive money grabbing style permeated throughout. However, the hotel was apparently full and what hope did I have? Now, the head office team is saying I “didn’t give them the opportunity to make it right” and are declining to compensate. I shouldn’t be surprised by a property where the team deliberately leave a room in service when it is clearly unhygienic and frankly disgusting.

I shouldn’t be surprised by the flippant attitude towards inadequate provision of services, when the hotel pays so little attention to product both physical and what they ask guests to consume. Yes, this is a property that will be financially successful because of location full stop. So we can withdraw all aspects of customer service? The problem is they belong in a brand that is trying to change this reputation.

The reality in both cases is that the product has missed so much investment it should be knocked down and rebuilt, and the team need to be replaced so this imbedded anti-hospitality culture can be knocked on the head. I have seen innovative approaches to investment so I know it is possible, but sadly the best ones are mainly from property developers and not colleagues within our industry.

Everyone must remember the enormous town houses around London’s Earls Court, which housed a multitude of two and three-star tired properties, an embarrassment for the industry and to our visitors. Some bright sparks have been developing them into short lets studios, with business travellers and leisure guests in mind; a hotel but not fully serviced; one where the facilities are brand new and clean. Unlike other homestay providers, they are still mixed market but not mixed with residents in blocks, where there is still a minimum stay to avoid the impact on local communities. A brilliant concept.

The hotel in Newcastle I first wrote about, has taken another route, it has been sold to Brittania, where I suspect it will make up part of a very tired portfolio, and where the strategy is to dilute customer service to benefit only the P&L. A bit like my second example, where I am hoping some real change can be delivered, if the right people take the right steps.

It leaves me thinking; what place do these hotels have in the market in the future? I can stay for less money in a homestay or B&B and I can stay in places with a better customer service led offer.

Are they set to continue then? Or are the online booking engines and the declining service levels enough to push them under? As a former operator, and now with the privileged position overseeing the inspection of hundreds of properties each year, I see three major options for these corporate behemoths: To innovate and find a way to improve translation between the Head Office vision and the on-the-ground delivery. If brands can succeed in actually delivering on the promises their brand makes, then there is very definitely a place in the market for them. If they don’t, well I can see a very different landscape in five, ten and fifteen years.

To morph into something new and be the early adopters of technology and innovation. These brands have the advantage of size and scale, so early adoption can carve their niche in the market and support customers to overlook shortcomings in other areas. It’s not the cheapest route to success though and they’ll need to make the right choices.

Possibly, a new kind of model will emerge, which enables the power, marketing, scale and economy of the big brand, with the personal, customer-service led offering of the small. It’s clear that communication, buy-in and care are disconnected and are often at the root of brands failing to achieve their aspirations. So what about something different? A new framework which creates a broad stroke corporate image and permits scale, but which functions more like a craft or independent business, with ‘tenanted’ operators. A model we are familiar with, with pub landlords, and which could offer the opportunity to marry corporate appeal with small brand ideals and customer service to match. An interesting concept.

This is not something that can be established overnight, nor do my musings even scratch the surface of the issue, but it is one that will clearly need to be addressed. What remains to be seen is how fast the demise will happen; I fear it is innovate or cease to exist for many of these places, and I for one am looking forward to these innovations. It’s also worth a mention that a revolution has started, with the likes of AirBnB supporting a squeeze from the bottom, and review sites supporting a squeeze from the top, so hopefully it’s only a matter of time before we start to see the shift.

We’re also lending our support, by scrapping the so called ‘common standards’ and focussing instead on the customer service led offering, an emphasis which many other brands are also seeking to establish. Watch this space…and if you need our help, give me a shout.