On the heels of celebrating its centennial in May, Hilton said it plans to open more luxury hotels this year than it has in any year prior. The hotel group expects to debut 11 luxury properties across its Waldorf Astoria, Conrad and LXR flags by the end of 2019, with four of those projects — the Waldorf Astoria Dubai International Financial Centre, the Waldorf Astoria Maldives Ithaafushi, the Conrad Hangzhou and the Conrad Washington, DC — already up and running. And Hilton CEO Christopher Nassetta last month told analysts that the company would introduce two brands: a yet-to-be-named upscale, lifestyle flag expected to join the fold in the next six months and a luxury lifestyle concept that would launch in the next few years. Hotels editor Christina Jelski spoke with Martin Rinck, executive vice president and global head of Hilton’s Luxury and Lifestyle Group, about Hilton’s robust investments in the luxury sector.
Q: With political and economic uncertainty top of mind for many hoteliers, why is now the right time to be bullish on luxury?
A: We have always been focused on luxury, and this continues to be an incredibly exciting time for the luxury industry overall. If you look at reports, like a recently publicized wealth report from Credit Suisse, you find the world’s wealth projection is expected to rise to about $400 trillion. Now that big number may sound a little abstract, but it’s actually a 26% growth rate over a five-year period from 2018. And there are other staggering statistics, like that the number of millionaires around the world is projected to go up from around 42 million to 55 million in total by 2023. We have opened some truly unforgettable properties in the last few years, such as Waldorf Astoria Beverly Hills, Waldorf Astoria Bangkok and Conrad Washington DC, and look forward to the additional properties we will open this year and beyond.
Q: What’s the update on Hilton’s first lifestyle brand, Canopy by Hilton, and why is it so important for the company to further expand into the competitive lifestyle sector?
A: Canopy by Hilton, our lifestyle brand, launched following years of research in 2014 for upper upscale travelers. Canopy provides truly authentic neighborhood experiences for locals and guests alike and is beginning to take off around the world, with 10 properties open across four countries and more than 40 hotels in the pipeline in places like France, South Africa, Thailand and the U.K.
We continuously evaluate the market, examine trends and listen to traveler feedback so we can better craft differentiated brand offerings to welcome new guests and address new markets. Our focused and disciplined development process is making sure we get these brands right before introducing them. Whereas the recent growth in this segment can’t be denied, we are confident that our approach and track record will make [our upscale lifestyle flag] another successful brand in the Hilton portfolio.
Q: How has the luxury landscape evolved? Do younger guests have different expectations of luxury than generations past?
A: Absolutely. I mean, the formality of the service component has — I don’t want to say it has completely disappeared, but it has become a little less important than it was in the past. And whereas about 10 years ago the hotels would have decided what you wanted and then given it to you because they felt they knew best, we’ve since gone through a period of personalization where we try to better understand what you want and then give you exactly that. And I would say, right now we are in a period in luxury where it’s all about engaging the guest emotionally throughout the entire booking, travel, stay and post-stay experiences.
Also, luxury has evolved in terms of technology, but if you look at recent research regarding the younger generations, the millennials, or going one further, Gen Z, you find that, yes, technology is important to them, but the human touch and the experience they have is equally important.
Technology plays a role, but it doesn’t replace the incredibly strong employee culture and service commitment that makes a luxury property stand out in a sea of sameness. It will still always be the people that make the difference.
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