Law: Visitors are staying longer despite uncertain economy
AS it enters new markets such as Indonesia and Australia and seeks to expand deeper in Asia-Pacific, Park Hotel Group (PHG) is embarking on a drive to strengthen its brand and product.
CEO Allen Law and executive director Shin Hui Tan envisioned “a big year” for PHG this year as they embark on a rebranding exercise, and asset and product enhancements.
RFPs have been called for the rebranding exercise, which they hope to finish by the third quarter. Another major undertaking is the renovation of Grand Park City Hall, the oldest hotel in the group, while product enhancements are being planned for Park Hotel Clarke Quay. Law and Tan declined to reveal more details on the projects.
PHG has already been making product enhancements over the last year, including providing free Handy smartphones for guests at Grand Park Orchard Singapore and soon, all its hotels in Singapore and Hong Kong. By April all its hotels will also offer free Wi-Fi. As well, PHG has fielded several new F&B concepts and, at the back of the house, implemented new technologies such as RFID-based laundry counting and tracking to boost productivity.
On the rebranding exercise, Tan said: “We’ve been progressive with our product development, but we do need to review if our brand messaging and proposition are also progressive.
“It might not mean that our Loving Hospitality messaging was no longer relevant. It might be just a question of conveying it well to today’s guests. And we now have to consider the brand look and feel in different markets, compared to one or two before. Today we are operating in six different countries and are targeting 10 different countries in the next one to two years,” she said.
Tan: Keeping brand messaging progressive
As part of the exercise, PHG would also look at whether its current two-tier Grand Park and Park brands are in line with its growth aspiration and if another tier is required.
PHG opened its first resort, Park Hotel Nusa Dua, Bali, last December and will break ground for the construction of the first Park Hotel in Australia in Adelaide, which is expected to be completed in 2018. CEO Allen Law said he was evaluating more opportunities in Indonesia, Australia and other Asian markets new to Park such as Malaysia and South Korea.
From a small Hong Kong hotel group, PHG, now Singapore-based, has grown into a regional chain with plans for a wider footprint in Asia-Pacific. Apart from the new resort in Bali, it operates four hotels in Singapore and another to open end of this year; three in China and one each in Hong Kong and Japan.
Park Hotel Nusa Dua, Bali
Law said he was looking for more properties in Singapore when asked if the chain was over-exposed in the city. He was not overly concerned with the decline in tourism revenue of seven per cent and a marginal increase of 0.9 per cent in arrivals last year, over 2014, with more challenges anticipated this year including more supply and weak economies.
“Actually, 2015 was not as bad as the general public think it is. A lot of people focus on arrivals which were on par last year (with 2014). But they don’t focus on room demand, i.e., the number of rooms sold, which grew over five per cent. This indicates that visitors are staying longer, which is a positive sign.
“I do agree that with economies not doing so well, this may affect the budgets of leisure and corporates, but we still expect a 10-15 per cent increment from last year despite the volatility and uncertainties,” said Law.
He added that having four-star hotels in the portfolio was helpful. “Our Bali resort for instance is trading quite well. When the economy is not so good, travellers are still able to enjoy a good holiday in a good four-star resort with nice rooms, great pool, etc, at a fraction of the cost. Most of the new supply in Bali are in the luxury market,” he said.
PHG is looking to grow both through ownership and management. New hotel partners are paying attention – its latest Singapore hotel, Park Alexandra Singapore, the Bali resort and Park Hotel Adelaide are all management contracts with new owners.
Law said adding value, coming up with new concepts and taking risks were key. Most of all, being owners, PHG thinks like one.
“Other owners know we manage their hotel like it’s ours,” he said.