Half a year since acquiring Australia’s StayWell Hospitality, Japan’s Prince Hotels is set to make its mark beyond its home ground, with two new brands about to be unveiled and plans to more than double the combined portfolios in 10 years.
For Prince Hotels, which has a stronghold in Japan, the acquisition has given it geographic diversity, and hence better “protection from peaks and declines, economic time frames and environments”, said Stan Brown, former executive vice president of Prince Hotels and now chairman and director of StayWell Holdings.
“The biggest difference is the risk is not just in Japan anymore. One example is right after the (Tōhoku) earthquake in March 2011, it was very difficult for hospitality players in the country, and for Prince especially because we didn’t have hotels in other regions,” he elaborated.
The goal is to grow the combined StayWell and Prince portfolios from about 88 properties today to 250 in 10 years, approximately 100 of which will be outside Japan and 150 of them StayWell hotels. A check on the hotel websites shows Prince now has seven overseas hotels, while StayWell’s full portfolio of 36 is outside Japan.
“Prince and Seibu have expertise and talent in Japan, but not (beyond). StayWell, operating in eight countries, brings (the relevant) expertise and language skills to the table,” Brown noted.
But a larger and more diversified portfolio is just one part of the strategy. Victor Osumi, managing executive officer of Prince Hotels, said: “One of the main reasons for expansion outside Japan is to create brand awareness, which will feed inbound business to Japan. Inbound used to be 20 per cent of total business, and we now have 36 per cent. It’s becoming a huge piece of business, but we want that to continue to grow.”
With Singaporeans making up 800,000 of Japan’s inbound visitors and other South-east Asian markets fast growing, “we really need the brand in Singapore and Bangkok”, Osumi continued.
Simon Wan, president and director of StayWell Holdings, added that Jakarta and Kuala Lumpur are also on the expansion map. Beyond South-east Asia, expansion will also take place in Australia, New Zealand, Japan, Taiwan, Oceania, the Middle East, Europe and the US.
To build recognition for Prince outside of Japan, the company will introduce a new five-star brand, which Brown says will have the name “tweaked a bit but with Prince still the key component”.
Another new lifestyle concept will be rolled out, with properties piloting a mobile app that allows users to select rooms and enjoy quicker check-in, Wan told TTG Asia. Such innovations, he said, are long overdue in the hospitality sector and would allow hotels to better cater to the needs of today’s guests and wrest bookings back from OTAs.
Brown further shared: “The parent company has a stronger balance sheet, so it will allow us to develop (while) still keeping the brands that we have. Prince has significant brand equity – probably the most of any brand in Japan, so we’ll keep Prince within Japan.”
He added that StayWell brands likewise “will stay”, with slight tweaks to the Park Regis brand.
Even as the company expands, Brown hinted that its moderate scale will remain a strategic anchor, adding that the portfolio will be kept to around half a dozen brands.
“Because of the big players and the consolidation that has occurred, you have saturation in given markets. A lot of owners look at us as (not having that) saturation so they get much quicker response when dealing with us. This has been one of our key strategic successes,” Brown said.
