The Leela Palaces, Hotels and Resorts has redefined luxury hospitality in India and has also become a force in the industry. The group, founded by Late Captain CP Krishnan Nair, began with one property on the outskirts of Mumbai. In a short span of three decades, it has grown into a network of nine properties across India, with plans to expand overseas, and gained acclaim for its unique identity among the world’s leading hotels. Rajiv Kaul, President of the group, recently spoke with Business World – Hotelier about the emerging market realities, the evolving guest experience, and ways to ramp up for the future.
What is the industry outlook for 2017?
Rajiv Kaul: Hospitality industry is fascinating – it is the canary in the coalmine, and reacts very quickly to economic and social events. When things take a turn, whether its terrorism, recession, demonetisation, or consolidation, it is rapidly reflected in our Revenues, Occupancies and RevPar. Overall, I am optimistic about the industry outlook in 2017 due to favourable political and economic conditions and increasing business confidence. We expect high single digit RevPar growth mainly coming from increasing ARRs. Growth shall be across all major segments – FIT, Corporate, Leisure and MICE. Incidentally, MICE segment could show maximum increase from regional overseas market due to growing popularity of the 72-hour e-visa facility. Also, F&B continues to have growth potential, especially from Banquets. As an industry, we are among major drivers of domestic economic growth, generating more employment than any other sector in the country. Internationally, Indian hotels are standing tall, recognized and awarded among the best in the world. That being said, we need to prepare for the emerging market realities and the paradigm shifts that are occurring.
What sets Indian luxury hospitality apart and do we have a competitive advantage?
RK: The maxim of hospitality in India that the guest is god has crossed generations. It dictates the respect and regard we always extend to our guests, and it is one of the biggest differentiators which set us apart from cookie-cutter lodgings that are available around the globe.
Based on our heritage, culture and traditions, we have a unique and an excellent story to tell. Excellence in hospitality is not a single act, but a habit to be repeated consistently.
It’s not just about personalized services but the warmth and grace with which they are delivered every time. Not just fulfilling a wish, but even anticipating one. As part of our DNA, we have an innate ability to make guests from around the world feel at home, to connect them with the local culture, cuisine and colours, and help them dive into the inner richness of India. The key to competing now in the new market realities is to leverage our inherent strengths and to translate them into a vibrant guest experience.
How have the customer preferences and expectations evolved over the last decade?
RK: Today’s guest has many different expectations from previous generations. Today’s luxury traveller is more empowered and confident, better informed. and cares more and more about memorable, immersive experiences and less about the product. They are savvy, and demand variety, myriad of choices, and insist on instant gratification more than ever before. Traveller’s prize unique experiences and the story telling opportunities they provide – they want to discover the hidden local secrets, from culture to cuisines, of the destinations instead of just visiting the typical tourist sites. They are not looking for ‘rich’ but ‘enriching’ experiences. Plus, we are all seeing the rise of the digitally empowered millennials, who want personalized communication on multiple platforms, seamless planning, flawless execution, authentic experiences, along with savvy use of social media.
How does one compete in the current environment?
RK: For a start, one has to be genuinely different and offer real value to the Customer. You will need to continually scan the environment, identify opportunities in a changing market economy and accordingly adjust your strategy and ensure swift execution.
Digital marketing provides a more transparent ROI as we can rifle target specific audiences in a fragmented market place. Further, Big Data analytics gives a deeper understanding of the purchase behavior and help identify guests with a higher overall lifetime value. Data savvy Brands that will utilize their data trails to get smart and actionable insights into what a particular guest expects from their stay will earn a competitive edge. Finally, there is no substitute for effective Execution and ultimately success shall governed by the speed and ability to execute.
How can social media and review sites be leveraged?
RK: A hospitality brand is no longer about we telling the guest, but what they tell each other, whether it is on review sites, social media, or blogs. Each touch point with a guest has become a valuable opportunity to nurture a deeper connection with travellers even before they check into a hotel. From a continuity point of view, social media allows hotels to engage with and become part of their guests’ journey across all five stages of travel – Dreaming, Planning, Booking, Traveling and Post-Travel. These are highly visual mediums, and as the saying goes, a picture is worth a thousand words, a picture shared by our guests…is priceless. Brands which make an effort to infuse elements of on-demand, personalization, and authenticity will likely fare much better than brands which do not, generating more revenue by driving loyalty, positive reviews, social likes and shares, and word-of-mouth recommendations.
Hotels around the world are reinventing themselves with technology? How does a luxury hotel balance a personal touch with modern technology to their advantage?
RK: Having personally looked after guests for over 35 years, undoubtedly technology has made the greatest impact in the past decade – from online booking systems to mobile ubiquity to virtual reality and guest room technology.
niversally, hotels are revitalising the industry with new and rapidly changing technology. However, it is necessary to remember that it is people that lie at the heart of hospitality. The value of being greeted warmly on arrival by your first-name and personally escorted for a check-in is far more memorable than an app talking back to you. In the pursuit of efficiency and profit, we should not forsake our biggest and most important resource: service from the heart. I say that the real disruption and innovation in Indian hospitality doesn’t lie only in technology and data analytics. It’s a lot more about the service, and the people delivering it. At The Leela, we view technology as a service enabler to better meet our guests’ needs.
Do you attract an equal number of domestic and international travellers? Do you see a difference in the tastes of the international and domestic travellers?
RK: The majority of our clientele remains international, and we are seeing growth in visitors from the Middle-East, South East Asia and Australia. However, the rate of growth of Domestic travellers in recent years, due to increased spending power, has been higher than foreign guests, and this trend shall only strengthen in future. Internationally, in addition to traditional long-haul markets – US and Western Europe, the E-visa is now encouraging short-haul impulse travel from neighbouring countries.
The Leela is comparatively a young hotel group which has, in a short span, received prestigious international acclaim and awards. What is the secret of this meteoric rise?
RK: We are deeply grateful to our guests who ranked The Leela fifth among the 15 ‘World’s Best Hotel Brands’ in the prestigious worldwide survey by Travel & Leisure, USA. Also, last month, in TripAdvisors “World’s Top 25 Travellers Choice List”, Leela Palace Udaipur is one of the two Indian hotels that made the list. Our founder Chairman Late Captain Nair’s vision was to provide our guests with a grand Indian experience that showcases the multi-layered richness of our country. The Leela difference can be felt in every aspect of a stay – from the way each hotel celebrates its location and showcases natural materials and Indian craftsmanship, to the way every guest is treated with honour, respect and regard and showered with thoughtful luxuries. Of course, one has to use technology and data analytics, but ultimately, it is about service and the people delivering it. Our young team is deeply committed to our values and the appreciation from discerning guests around the globe, for our efforts is most encouraging.
Leela is now focusing on the asset-light strategy, how is this model working out for the group?
RK: The Leela brand currently owns and operates nine properties across India, and the next cycle of growth will be through an asset light strategy with Management Contracts. Our plan is to continue to operate in the bespoke luxury hospitality space and be very selective with the destinations we choose for expansion. The upcoming projects are all through management contracts, including, a Palace hotel in the historic city of Agra, where every room will have a sweeping vista of The Taj Mahal; a Palace resort in Jaipur; a business hotel at Bhartiya City, Bangalore; internationally – we are looking closely at Maldives, Seychelles, Abu Dhabi and Dubai.
Given the current global economic slowdown, most luxury brands/corporate houses are reworking their marketing strategy. What are the innovative experiences being offered at the Leela Palace Hotels and Resorts this year?
RK: A major reason for our guests appreciating The Leela experience is the way in which we introduce them to the destination, and showcase bespoke experiences that are not ordinarily available. More important, our endeavour is that our hotels should serve as a great gateway to the destination, open our guests to people, places and things that help enrich their knowledge and understanding of India.
We also make the hotels’ environment and its landscaped green spaces, central to the guest experience of India. Celebration of Indian art, architecture, cuisines and culture is at the core of The Leela hospitality. The Leela difference can be felt in every aspect of a stay –from the way each hotel celebrates its location and showcases Indian craftsmanship and natural materials, to the way every guest is treated with honour and regard, and showered with a host of thoughtful luxuries. With these elements at their heart, our plan for all nine Leela hotels is to continue to surprise and delight our discerning guests with touches that reveal the multi-layered richness of India.
How did the partnerships with Megu and Le Cirque come about? Did you need to adapt these concepts to make them a success in India? Did you anticipate that the Indian marketplace would accept them as they did?
RK: We partnered with iconic international brands like Le Cirque and Megu to recreate the same fine dining experiences in India that our discerning guests enjoy in New York, Dubai or London. Our focus was to deliver memorable dining experiences with uncompromised quality and authenticity. Of course we rebalanced the menus to offer a wider vegetarian selection and introduced dishes to showcase the finest local produce. I am happy to share that the guest patronage and appreciation of both these restaurants has exceeded our expectation. The success of Le Cirque, New Delhi has encouraged us to launch Le Cirque signature (a more relaxed version of the original restaurant) at The Leela Mumbai and The Leela Palace Bangalore.
What advice would you give to young hotel professionals who desire success in the industry?
RK: Now is a best time ever to enter the industry, as it is poised for expansion and growth. My advice to tomorrow’s leaders is to develop hunger for knowledge and make learning a continuous process – because a person who graduates today and stops learning tomorrow is uneducated the day after. Be a Problem solver and be genuinely committed to your guest and your staff; ensure that your actions create meaningful value for you, reward your guests, and are profitable for your hotel.