Associated Luxury Hotels says it is investing more than US$10 million this year on a slew of new hires and initiatives at WorldHotels, which it acquired in February last year, and believes its leadership of seasoned hoteliers and a sales-focused culture will make a whole world of difference to WorldHotels.
Tom Santora, chief commercial officer of Associated Luxury Hotels and executive chairman of WorldHotels, said in an interview in Singapore on the strategic direction for WorldHotels: “Our mantra is, we’re not in the membership business; we are in the revenue generation business. We want to grow the membership in the right places to support our customers, and we want to make sure we have the sales support to make those hotels successful.
“We’ve always been a sales-focused organisation that highly incentivises our sales people to perform.”
Associated Luxury Hotels International (ALHI), owned by Associated Luxury Hotels, has over 30 years’ track record as a global sales organisation matching meeting & incentive planners in North America to its portfolio of over 250 luxury hotels and resorts.
That sales-oriented culture has quickly seeped into WorldHotels.
A new incentive scheme for sales staff of WorldHotels, for instance, is now in place. James Koh, WorldHotels’ regional vice president hotel development Asia-Pacific who has been with the company for more than 11 years and was recently promoted to the position, said: “One thing that is vastly different is the more attractive incentive scheme that has been put together. In the past there wasn’t really a proper programme in place. Clearly this will be the key driver for the sales (team) as they will be rewarded for the targets they hit.”
Santora said: “WorldHotels did a nice job in driving revenue but it was more of a supportive role to members. We’re shifting the culture and we want to amp that up, removing obstacles so that the sales people can perform and providing them with the tools – technology, collaterals, access to go to more events and so forth – to succeed.
“With all the independent hotel groups being on the same technology (Sabre SynXis Central Reservations), technology is a given. So what makes the difference? Sales,” he added.
At acquisition 14 months ago, WorldHotels said it had 140 sales professionals and expert staff globally. The company recently promoted one of its sales veterans, Ganessan Suppiah, to regional vice president of sales Asia-Pacific. Outside the region, recent new hires included Tim Burke, global director, travel industry partnerships, and Fernando Carranza, regional director of sales based in Los Angeles. Both came from the hospitality sector.
Santora pointed out how an organisation that is run by hoteliers is “a big shift” for WorldHotels, which was previously owned by Battery Ventures, a private equity firm whose focus was more on technology companies.
The leadership at Associated Luxury Hotels rose through the ranks from a sales and marketing background. President & CEO Josh Lesnick was Wyndham Hotel Group’s EVP and CMO, while Santora was OMNI Hotels & Resorts’ CMO and SVP of sales. Chief sales officer Mark Sergot was Fairmont Hotels & Resorts’ SVP of sales. WorldHotels’ CEO Geoff Andrew was Corinthia Hotels International’s head of sales and marketing before joining WorldHotels’ then sister company, Nexus.
“We are an organisation that is run all by hoteliers and we’re very involved with our hotels. Members have access to me, Josh, Mark, if they have a problem with anything; we’re not just providing our sales people with directions, we’re almost hands on with our members.
“WorldHotels was always owned by distribution – it’s almost a different business model. This is a big shift. Now we are focused on getting the right members in the right locations and we’re all about sales,” said Santora.
Support for members is also being intensified. In Asia-Pacific, WorldHotels last week signed an in-principle agreement with ACI HR Solutions as its training partner for the region. ACI will provide training to WorldHotels members, starting with those in China and Japan, on sales and marketing, including revenue optimisation, digital marketing and social media marketing.
“The most successful members are the ones that engage with us,” said Santora. “It’s like having a gym membership. We have all the equipment – from sales missions to digital experts to help you with your booking engine – but if you don’t go to the gym and use the machines, you’re not taking advantage of your membership.”
Continuing the analogy, he said WorldHotels has one “personal trainer” (officially a person guiding members on performance revenue optimisation, or PRO) per 20 hotel members while the ratio might be one per 60 or even 90 elsewhere. “We hired a PRO from another group – that person had 115 hotels to one person. So he was just being reactive whereas our ratio allows our PROs to be proactive,” he said.
Koh believes the new directions for WorldHotels will put it on an even keel to compete for new members and retain existing ones in the region. Asia-Pacific is WorldHotels’ second largest market (93 members) after Europe (175 members). WorldHotels has 350 members currently.
“With Associated Luxury Hotels coming in, a lot of things have changed and new directions set. Our fees are transparent, based on actual data the hotel provides and what we think we can produce – everything is factual,” Koh said.
Santora elaborated: “When we’re talking to a potential new member, our capabilities presentation is almost all numbers: our year-on-year growth, GDS production, consortia production, how many accounts do we have in your market that we can tap into, and so forth. It’s not ‘here’s the ads we ran, or here’s the PR we’ve garnered’. Those are important and we do all that but at the end of the day, the focus is on sales, because revenue is what members want.”
Santora has set a target of 500 members but he re-emphasised expansion is going to be strategic. “It might even be addition by subtraction. There could be members that are not profitable or that we can’t support, so we may see those hotels go. We might not get 15 new hotels onboard but we might have five new ones that from our perspective generate more revenue than the 15.
“In the past year, we have turned away over 10,000 rooms inventory from people who came to us. When we did the background, we didn’t think we could support them so we didn’t want to take their money, or we felt their quality wasn’t where we’re going. We’re trying to shift the focus to the right hotels that we can help make a success.”