Carlson Rezidor brings Red to China

October 15, 2014

CARLSON Rezidor Hotel Group will debut its new Radisson Red hotel brand in Asia-Pacific with the launch of the Radisson Red Shenyang Hunnan in north-eastern China.

Set to open in 2016, the 300-key Radisson Red Shenyang Hunnan will form part of a twin-hotel development including Radisson Blu Shenyang in the capital of Liaoning Province, Shenyang.

Located in the city’s CBD, Hunnan New District, in Shenyang National High-Tech Industrial Development Zone, the two hotels are also close to Shenyang International Exhibition Center, the Sports Stadium and Shenyang International Airport.

Both properties are owned by Shenyang New Times Investment.

The Radisson Red Shenyang Hunnan will focus on design, detail, choice, personal interaction and technology. Guests enter the hotel to find themselves in the art-themed Hi All Gallery, and interaction is also built into the F&B outlets Ouibar and the 24-hour Redeli, which are open and social spaces.

Carlson Rezidor Hotel Group’s president Asia Pacific, Thorsten Kirschke, said: “The signing of Radisson Red Shenyang Hunnan marks an important milestone for the Radisson Red brand, being the first in the world. We expect to see Radisson Red feature significantly in our portfolio growth in China, as well as across the region, as the brand has a strong relevance to the growing segment of millennial-minded travellers and a compelling value proposition for hotel owners and investors.

“Of the global target of 60 (properties) by 2020, we are confident that half of it will be in Asia-Pacific. This new addition to our China portfolio further strengthens our commitment to China. We will be growing our presence in China, from 13 hotels currently in operation to 41 within the next three years.”

Carlson Rezidor unveiled two news brands in February this year – Radisson Red and the Quorvus Collection, which is a portfolio of iconic hotels.

Amadeus’ new merchandising system to allow for personalised offerings

By TTG Asia

October 15, 2014

AMADEUS is developing a new Global Merchandising System, which purports to let airlines create dynamic offerings at any time, through any point of sale, on any channel, through any device, to reach the consumer.

Delivered through Amadeus’ direct retailing and distribution systems, the Global Merchandising System relays search results based on real-time intelligence and information from both buyer and seller. This gives airlines the ability to develop personalised offers.

Both the new Global Merchandising System and Amadeus’ direct retailing and distribution systems are available to Altea and non-Altea users, and will be compatible with the upcoming NDC XML industry standards.

“The introduction of dynamic and flexible merchandising tools for airlines will give them the opportunity to deliver a unique and personalised customer experience for each traveller and in doing so, could unlock significant revenues,” said Julia Sattel, senior vice president of airline IT at Amadeus.

“Each customer values something different in their travel experience and Amadeus can help airlines to become intimate with their customers’ needs and deliver them the experience they want, increasing both their loyalty and value.”

Research by Amadeus unveiled that airlines are already earning US$50 billion in annual revenues through the sale of ancillaries, and a further US$53 billion could be earned by adopting an omni-channel strategy for the same services by 2020.

It also expects a further US$77 billion to come from new innovation in travel technology in the same period.

British Airways steps up frequency on London-Chennai sector

By Rohit Kaul

October 15, 2014

BRITISH Airways (BA) will increase the frequency between Chennai and London to a daily service from October 27, up from the earlier six flights a week.

BA will also serve the route using Boeing 787 Dreamliner with three class configurations: business, premium economy and economy. Chennai will become the second market in India after Hyderabad where the airline operates the Dreamliner aircraft.

Christopher Fordyce, BA’s regional commercial manager, South Asia, said: “The daily service will give business and leisure customers the opportunity to connect with our extensive global network from Heathrow.”

The growing economy in Chennai will offer opportunities to international airlines, posited Rajji Rai, chairman, Uniglobe Swift Travel. “India is the second biggest market for BA after North America. BA has been seeing a good demand from South India in the past and its frequency addition will help it to further consolidate its position in the region,” he added.

ASEAN open skies dream remains unfulfilled

By Hannah Koh

October 15, 2014

AIRLINES, particularly LCCs, are making inroads in delivering the fabled ASEAN open skies policy first mooted a decade ago.

In an attempt to address the issue during yesterday’s panel discussion, Alan Tan, professor of aviation law at the National University of Singapore, argued that a true liberalisation would ensure seventh freedom rights – the right to transport passengers between two foreign countries without offering flights to one’s home country – in the ASEAN Single Aviation Market.

“Without seventh freedom rights, a Singapore airline would not be able to connect say, the Philippines, with China. But Chinese carriers, with a single backyard, can fly from any point in China to any point in ASEAN, creating an immediate systemic imbalance,” Tan explained.

Citing the same example of flying from ASEAN to China, AirAsia X CEO, Azran Osman-Rani, said: “We’ve circumvented that, bowing down to foreign ownership limits and creating joint ventures to have multiple hubs across South-east Asia, so that we’d be able to use the national rights to fly to China.

“That’s step one, because we need to get to the stage where governments see there are parties on both ends who are not significantly outsized or outstripped. We’ve generated (customer) demand first.

“The issue isn’t defending against Chinese carriers but embracing the opportunity and, by virtue of the fact that maybe the Chinese will start and take advantage of their disproportionate rights, gives us the mechanism to go back to our government and say ‘we’d like to be able to reciprocate’,” he concluded.

Echoing Osman-Rani’s comments during the panel, Peter Harbison, chief executive, CAPA – Centre for Aviation told TTG Asia e-Daily: “What the ASEAN Single Aviation Market proposes to do has in effect already been achieved commercially.”

Pointing to Thai AirAsia and the wider AirAsia network as an example, he remarked that although effective control is obviously coming from the external source and the local partner is usually a sleeping one, governments have looked the other way. “This is what I meant by passive liberalisation, which is driven by the market.”

However, Harbison does not expect much to change in the South-east Asian commercial aviation landscape between now and 2015. “It’s theoretically possible, but commercially that won’t happen,” he said.

Fairmont infuses old Beijing in new meeting package

By TTG Asia

October 15, 2014

FAIRMONT Beijing’s new MICE package for its three Hutong-inspired meeting spaces offers guests a new twist on regular meetings.

The three venues, which total 378m2, include the main Gold Fish Hutong room which can accommodate up to 200 pax in theatre style.

The meeting package includes themed coffee breaks throughout, Nespresso coffee machine usage, and a personal banquet service. Groups can make use of state-of-the-art meeting technology, an LCD projector and screen, podium with standing microphone and two wireless microphones, a whiteboard or flipchart with markers, and other amenities including writing pads, pencils, mint candies, and bottled water.

The full-day meeting package is priced at RMB680 (US$111) per delegate while the half-day option goes for RMB650 per attendee.

Technology, medical science leaders link up at Daegu conventions

By TTG Asia

October 15, 2014

THE South Korean city of Deagu last month played host two two major technology conventions from September 24 to 27, bringing together the brightest minds from the fields of innovation and medicine.

Held at the Daegu Gyongbuk Institute of Science and Technology, the 11th Asia Association of Learning Innovation and Coevolution Studies (ASIALICS 2014) saw former vice chairman of Samsung Electronics, Jong-Yong Yun, deliver the keynote speech.

It drew participation from researchers in local institutions, namely Keimyung University, Daegu Technopark, the Science and Technology Policy Institute, and the Korea Institute of Science & Technology Evaluation and Planning.

At the same time, the city also welcomed the Tissue Engineering and Regenerative Medicine International Society Asia-Pacific Annual Conference 2014 at Daegu Exhibition and Convention Center.

The event was attended by 800 tissue engineering and regenerative specialists from 40 countries, who discussed and presented the most cutting-edge research in the field.

Delegates also went on a technical tour to visit the city’s infrastructure of medical research.

Jeong-Ok Grace Lim, president of the Korean Tissue Engineering and Regenerative Medicine Society which organises the conference, of which she is also programme chair, said Daegu has shifted its investments from the IT sector to biotechnology.

“Local officials have been especially influential in initiating research in this area, providing support to form a research partnership between Kyungpook National University and Wake Forest Institute for Regenerative Medicine.”

Lim is also professor at Kyungpook National University Hospital’s Biomedical Research Institute.

In Daegu alone there are 3,000 medical institutions including 12 full-service hospitals, five medical schools, and 48 medical research centres.

Overhaul in China’s associations industry required

By Jessie Liu

October 15, 2014

CHINA needs to relax the stringent rules governing associations and nurture a more vibrant industry by gaining a deeper understanding of the roles of associations in society.

New associations must register with both the relevant ministry overseeing its field and the Ministry of Civil Affairs, hindering the establishment of associations. Government scrutiny of association activities also acts as an obstacle.

However, sources have revealed that the Chinese government could introduce reforms to ease these restrictions before end-2014 at the earliest, a move that could boost the MICE industry.

American Society of Association Executives (ASAE) China representative, Maria Tong, observed that many NGOs have offered advice on possible reforms to existing legislations, such as mandating applications to be submitted to oen authority instead of two.

At the same time, ASAE research found that Chinese associations are still in their infancy, with little concept of association management.

International association management firms should thus enter the China market gradually, communicating knowledge on association management to help improve professional standards, and enhance the relationship between associations in China and the US.

Meanwhile, Tong pointed out that attracting the young, a challenge for counterparts in the West, was also an issue here. ASAE provides a range of services for associations including harnessing new communication methods such as social media and keeping abreast with the latest trends to better engage youth members.

Likewise, MCI Group’s director of association management and consulting, Florence Chua, commented that industry associations must research on the youth’s consumption and social behaviour and develop accurate understanding of their needs.

Translated from the original TTG-BTmice China e-Weekly, October 8, 2014, article by Ong Yanchun

Seeing red and blu

By Raini Hamdi

October 14, 2014

He’s been with the group for 20 years and in April this year took over from Simon Barlow as Carlson Rezidor Hotel Group’s president Asia-Pacific based in Singapore. Thorsten Kirschke tells Raini Hamdi he is open to franchising and aims to expand the chain’s two new brands in the region

Your predecessors created a lot of growth. By year-end, the group will operate more than 100 hotels across Asia-Pacific. How do you hope to top that?
There is still a lot of demand for branded, reliable hotel brands. Markets like India and China drive the growth because of their sheer size but there are other pockets such as Indonesia, the Philippines and Thailand, and new sparks, for example Myanmar or even Bangladesh, where many international chains are trying to make an entry. We are present there (Bangladesh) with one hotel in operation and another in pre-opening.

Australia, the surrounding New Caledonia and New Zealand are yet another great potential for branded inventory.

What’s your strategy?
Three-pronged. One is to deepen our strategic alliances. They come in several shapes: some are on the back of an articulated contract, like a JV, others are more built around relationships, but no matter what they are, they are fundamental to development in this part of the world.

For example, the SM Group (in the Philippines) is a contractual agreement with the commitment for development over several years but, as we know, it is a private family that is at the base of this company. Here’s where Carlson Rezidor has a huge advantage because we ourselves are a private company and we do understand the values that drive a family business. Thereby, the relationship aspect with that company becomes more important. Understanding the ‘mechanics’ and not being forced to report to a stock exchange on a quarterly basis is of great value.

What’s the second prong?
To broaden our business model. We see the opportunity for controlled franchise development, and to target conversion opportunities, which previously were not as clear on our agenda for growth.

For example, we are evaluating a multiple-unit franchise agreement in China with a well-respected group that owns one of our properties today and several others. This could be a fantastic recipe for future growth, provided our partners demonstrate the capabilities of operating the hotel within the brand promise.

Has Carlson Rezidor done any franchising in Asia-Pacific to date?
In India, there is a master licence agreement for Country Inns & Suites with CDMS (Country Development & Management Services, a joint venture between Country Inns & Suites and Chanakya Hotels since 1998). Other than that we have stayed away from franchising which is precisely why I believe there is opportunity for future growth as we see capabilities evolve in this part of the world.

How have capabilities evolved?
We see owners becoming more ‘educated’ as the hospitality industry grows in Asia-Pacific. Some of them have started to form their own management companies.

The China group for example has started to build its own management capability, as in people and resources. We have a long-standing relationship with the company; we have known the properties’ GMs for many years. So there is an opportunity to expand this relationship under the umbrella of franchising.

India too, is a long-standing relationship. We have deep trust in each other. They were the founding members in driving our presence today in India. We are the largest international hotel operator in India and this would not happen if it hadn’t been for the mutual trust. This proves that franchising as a business model and vehicle for growth has its merits even in developing markets and particularly here in Asia-Pacific.

How do you intend to franchise and is it only for Country Inns & Suites?
We would not give an exclusive master licence either for a brand or a territory – that is one step ahead in this business model, particularly in China.

We’re open to franchise all brands, but the higher the segmentation, the more complex it becomes. In China, we are considering the higher-positioned brands, Radisson and Radisson Blu, for franchising, but again it is case-by-case evaluation. What I’m saying is we are not ruling out franchising anymore. We would be negligent if we do not consider the increased capabilities investors have assumed over time, and franchising as an avenue for growth as a result of it.

So selective franchising and conversion targeting is the second dimension we are pursuing for further growth in the Asia-Pacifc region.

Why are conversion opportunities on your agenda now?
A report some years back identified a list of conversion opportunities in Asia-Pacific but the number then was not very large. We see that growing and, of course, we know conversions are lucrative and fast-to-market, so we have identified this as a platform to grow.

These can be existing hotels where agreements are expiring, or conversion of potentially non-branded to branded assets, or on the rare occasion, re-adaptive use of existing buildings. As the real estate market in Asia-Pacific matures further, we’ll see more of that going forward.

So what’s the third prong?
The third is the introduction of new brands into market, Quorvus Collection and Radisson Red (TTG Asia e-Daily, July 25, 2014). Quorvus is a luxury brand by affiliation, catering to hotels that are clearly looking for a platform and distribution while protecting their heritage and identity. Red clearly taps into a niche that has evolved in the last number of years and is making its way into developing markets around the world. It speaks to changing demographics – we know that today the younger generation, which forms almost a third of tomorrow’s travellers, uses hotel facilities differently than maybe myself or other generations before me. It is much centred on community and communality. It is an upscale select offering – there are reduced services and facilities but it is upscale from the build-out to the quality. I call it lifestyle select.

What happened to your luxury partnership with Missoni?
Missoni was defined as a fashion/lifestyle brand in partnership with the Missoni family but we are dissolving the relationship for several reasons I wouldn’t want to go into at this point. We are ‘folding’ two of the former Missoni hotels (GV Royal Mile Hotel Edinburgh and Symphony Style Hotel Kuwait; the collection also now has a third member, The May Fair Hotel London) into the Quorvus Collection. At this point, too, we will not create another distinct fashion/lifestyle brand.

Is it a fair criticism that chains just dream up brands so they can get management contracts?
Every company has to grow. Whether it is retail, fashion or liquor, companies are expanding their portfolios continuously, not for sake of growth but in response to new and evolving demand from changing demographics, markets and different consumer trends around the world. Ikea is not what it was 20 years ago, and we can quote many other companies from other industries that have evolved over time.

Of course underneath all that is the looming danger of commoditisation when we bring new brands to the market and I know this is also on the minds of my colleagues around the world.
But I think the industry is doing a good job.

Really? I see a lot of sameness in the rush to cater to Gen Y, for example.
Of course you’d find global international chains collectively responding to the changing demand – that is only logical. The question then becomes who is delivering and executing to the best of the consumer expectations. You can’t just develop a brand on a piece of paper, you must be able to deliver it.

As customers change, won’t your older brands be sidelined by the new brands?
No, we have taken great effort to rejuvenate our portfolio – our Radisson Re-imagined initiative was probably one of the largest brand renovation projects. We also developed the fourth generation of Country Inns & Suites so that the brand is more relevant to younger travellers.

So we do always manage our brands to stay relevant but of course every brand can only ever evolve so much in its rightful positioning, and there is always an opportunity to launch new ones. The upscale select brand, for example, was not an opportunity that existed 15-20 years ago, when mostly upscale, full-service hotels were built. That was also the time all the great brands of the world were travelling globally.

So what’s next – a Green? Is there another gap the group wants to fill?
I know there are still segments we’re not covering today – we do not have a brand in the economy/budget sector, for instance.

This article was first published in TTG Asia, October 10, 2014 issue, on page 9. To read more, please view our digital edition or click here to subscribe

Golden Week performance holds for HK, but future bookings shaky

By Prudence Lui

October 14, 2014

THE impacts of the ongoing Occupy Central protest on Hong Kong’s tourism sector are becoming more apparent since it started in late September.

While Harbour Plaza 8 Degrees saw minimal cancellations during the week-long National Day holiday and maintained an occupancy rate similar to last year’s (over 90 per cent), general manager Christina Cheng said that the hotel received cancellations of 180 room nights for this month.

She added: “Some business partners told us that some overseas clients have switched to other destinations due to the current situation in Hong Kong. This affects our future pick-ups.”

Sharing similar views, InterContinental Hong Kong, director of sales and marketing, Linda Hodgson, said: “During and immediately following China’s Golden Week, there was a slowdown in bookings and enquiries particularly from the Chinese market. However, the business segment continues to show strong bookings for the month and the general pace has increased again over the last few days. We did not receive any requests to postpone or cancel events in the next few months.”

While there were rumours that the Chinese government suspended the issuance of group tour and FIT visas to Hong Kong since late September, Sincere International Travel Services managing director, Charles Ng, shared that he did not receive any official documents so far.

“For sure, the visa service was stopped during the Golden Week holiday but I haven’t seen Chinese traffic stopping over the past week,” he said. “The movement did exert a negative impact on the city, but Chinese travellers are (in fact already) spoiled with many itineraries and destinations more affordable than Hong Kong. It’s not a must for them to come here.”

Although Chinese arrivals to Hong Kong grew 5.6 per cent over the Golden Week, Travel Industry Council chairman Michael Wu expressed worries that if the protest drags on, business and MICE traffic might be diverted to Macau.

Preliminary statistics by Public Security Police Force of Macau showed over 840,000 Chinese visited the city during the Golden Week, an increase of 17 per cent.

However, Gray Line Tours of Macau managing director, Andy Wu, said: “The growth this year is within our expectation. Chinese group tours always put Hong Kong and Macau as twin destinations, so they would not just come to Macau.”

China’s theme park war revs up with Universal Studios Beijing

By TTG Asia

October 14, 2014

THE Chinese capital is set to become the third destination in Asia to have a Universal Studios theme park, following Japan’s Osaka and Singapore, according to media reports.

The 20 billion yuan (US$3.3 billion) park will span some 120ha in Beijing’s south-eastern Tongzhou district, according to China Daily. The complex will be jointly owned by Universal Parks & Resorts and Beijing Shouhuan Cultural Tourism Investment, a consortium of four state-owned companies.

The destination will be home to China-themed attractions as well as well-known ones based on Western brands like the Harry Potter series, according to a Reuters report.

Tom Williams, chief executive of Universal Parks and Resorts was also reported by Reutersto have said that the park would target to attract visitors from outside China, while Hollywood director Steven Spielberg would be participating in the design.

Although no opening date was announced by the company and its Chinese partners, local media said that the park would debut in 2019.

The Beijing Universal theme park is expected to join a flurry of theme parks debuting in China in the next few years, including Shanghai Disney Resort, which is due to open in late 2015, and a entertainment complex by DreamWorks Animation, scheduled to launch in Shanghai by 2016.