UK hotel management company Bespoke is launching its offer into the US market, in a bid to show the Americans that British character still has a place in a highly branded hotel sector.
Bespoke chief executive Haydn Fentum said the timing for the venture felt right, and was also the result of meeting the right potential US partner in Toby Syson. “It’s been a pretty much one way street until now. But we’ve always felt there was a gap in the market here and in Europe for unbranded hotels. We’d been looking at an overseas venture, and we just hit it off with Toby.”
Bespoke has consistently delivered a management service for non-branded hotels in the UK, eschewing involvement in portfolios of chain hotels operating under the major brand flags. Fentum admits his strategy has seen Bespoke lose out in the numbers game as it sought to grow in earlier years: “Every time we pitched for something, we lost it; but we kept sticking to our idea.” This also meant not signing up to properties dogged by overly aggressive lease deals, many of which have found the going tough as markets slipped.
But the recession has seen the company pick up the management of increasing numbers of less strongly branded hotels. Sometimes, this has been at the behest of administrators or banks, looking to maximise revenues from hotel companies suffering other financial issues; while most recently it was the decision of Topland, the new owners of the Menzies hotel portfolio, to hire Bespoke as management.
The service is one “where the hotel is still seen as champion,” explains Fentum. “It all comes back to – particularly for leisure-led businesses – would you rather go home and say you stayed in a great hotel, or in a Holiday Inn. People like that the hotels are not cookie cutter.” He points to an ex Park Inn property in Sheffield, where the change from a brand to a more stand-alone style has increased weekend business, and improved occupancy 8% overall.
For owners, the service offers central reservations and distribution support, low commissions, with flexibility on signing up or leaving the system. “It’s similar in some ways to Best Western, but you’re still very independent and can promote yourself as you want.”
The Bespoke portfolio currently stands at just over 100 managed properties, with Fentum still seeing benefits from further growth. The US venture, which will initially be cost negative, is one opportunity that scale offers support for.
In the US, one of the first properties Bespoke is looking after is the Mariner’s Lodge and Marina in Fort Myers, Florida. “Fort Myers doesn’t lend itself to a brand,” said Fentum, adding there are plenty more boutique hotels in the states, and in the nearby Caribbean, that lend themselves to the individual treatment.
Bespoke has launched several soft brands under its own name, such as Beloved, Befriend, and BeInns. “It’s mainly to give a level of differentiation to people on the website,” said Fentum, “it’s useful shorthand.” He has no firm plans to extend the scope of these, preferring to stick with the brand value of locally recognised venues, whether that’s the Lugger on the Cornish coast, or the Skeabost on the Isle of Skye.
HA Perspective: [by Katherine Doggrell] When the brands seek to defend themselves, the first direction they point is west, where they have a taste for the cookie cutter in the exact opposite proportions to Europe. As of November last year it was 66% branded in the US, 61% unbranded in Europe, according to STR Global.
And still they come. Hilton Worldwide is planning a boutique launch this year and elsewhere in this issue Marriott International has been putting its money where its mouth is by backing Edition.
The US is seeing a backlash amongst its populace who are no longer happy to stay in the same room all over the country, but are looking for something more individual. They are replacing the confidence and reassurance which the brand gave them with the reassurance that the wisdom of crowds gives them through TripAdvisor. They feel safe in taking a chance on that unknown kid and a having a unique experience they can brag to their friends about afterwards.
More pertinently, owners see alternate methods of distribution being plied on the internet and have realised they are less reliant on the brands to fill beds than they used to be. Putting together a reasonably-sized group of unbranded hotels under something like Bespoke takes care of economies of scale as far as toilet roll goes.
With hotel supply in the US remaining limited, owners can afford to hold beauty parades of brands should they wish but, with demand looking to pick up in 2014, such is the need for rooms that they have never needed the flags less.