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Next Wave of Travellers Care Less about Luxury Hotel Bling

Jun 11, 13 | 12:05 am 


By Kevin Brass

Luxury hotel executives know they have a problem.

A pillow menu, gold-plated bathroom fixtures and spacious rooms will not be enough to woo the next generation of the world's wealthiest clientele. They will be better traveled than their parents and grandparents, and much harder to please.

"The younger generation, who is 28 to 35 years of age, they will start traveling differently," said Marco P. Nijhof, chief executive of Yoo Hotels, a division of the London-based company co-founded by the designer Philippe Starck. "It's a whole different ballgame."

Designers are proposing everything from underwater hotels to high-tech enclaves that will use facial-recognition software to predict a guest's every whim. But some are moving in the opposite direction, creating simple hotels that they want to stand as works of art, allowing guests to escape from their hectic lives.

"People are moving away from the bling factor," said Andreas Scriven, director and head of consulting for Christie & Co., a sales and advisory company for the hospitality industry.

No one is sure what will work. But everyone knows the stakes are huge. The luxury hospitality sector is valued at an estimated €127 billion, or $164.4 billion, a year, up from €91 billion in 2009, according to Bain & Co., the global management consulting firm based in Boston.

And the target audience is growing at an unprecedented rate. By 2022, there will be 4,076 billionaires in the world, an 85 percent increase from the 2,198 billionaires in 2012, the international property agency Knight Frank predicts.

There also will be 285,000 high net-worth individuals with at least $30 million in assets, a 50 percent increase from 2012, the agency's analysts say.

In many parts of the world, luxury hotels have recovered from the global recession far more quickly than other economic sectors.

The average price for a night in a luxury hotel last year in Paris was €617, up from €532 in 2010, according to data tracked by STR Global, a hotel research company. And in Hong Kong, the average daily rate for a luxury room in 2012 was 2,585 Hong Kong dollars, or $333, up from 1,901 dollars in 2010.

In response to the market forces, developers now are building 458 luxury hotel projects with 123,325 rooms around the world, according to STR data. Of those, 253 are in the Asia-Pacific region, the area with the largest predicted growth in billionaires.

The rapid development of the luxury market in Asia is sending ripples through the entire industry, some say.

"Asia will continue to set the trend in creativity and what you can do," said Mr. Nijhof, the Yoo Hotels chief.

The next wave of luxury hotels around the world is expected to try to reach the standards of many top Asian resorts in emphasizing exceptional levels of service, privacy and nature.

"It is the personal service you get in certain countries in Asia, but not in Europe and the U.S.," said Jaya Ibrahim, founder of Jaya International, an Indonesia-based design firm that had worked on luxury hotels around the globe. "It doesn't happen in ordinary hotels because it is very expensive."

To compete, private butlers will become more common, as customers come to expect their bags to be unpacked and in-room refrigerators stocked with their favorite foods and beverages, some executives say.

Hotels will also have to know more about their customers. Software and services that help hotels anticipate the needs and desires of clients are in their infancy now, many analysts say. And concierge services will have to advance to new levels, delivering on the demands of guests long before they arrive.

Helicopter pickup service will become more popular, connecting to airfields used by private jets, said Xavier Destribats, senior vice president for operations with Kempinski Hotels. "More and more of the clientele will use private planes," he said.

And in some markets, security will become increasingly important; the bulletproof glass and steel doors now in some locations will be replaced by bazooka-proof glass and personal panic rooms.

"These customers will be more and more demanding," Mr. Destribats said. "If they are going to pay for it, they are expecting value for what they are going to pay."

Then there is technology. While hotels will be expected to provide the latest array of gadgets, guests will also want seamless use of their own mobile devices, analysts say.

There's more… carry on reading page 2 of "Next Wave of Travellers Care Less about Luxury Hotel Bling" on the NY Times website. 

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