After disrupting hotel business models in Europe and US, Yotel turns its eyes on Asia
Visitors to the newly-opened Yotel Singapore must pass by two robots waiters and a stretch of self check-in counters that are lined up against both sides of the lobby, only engaging with humans when they reach the front desk at the end.
This is done on purpose, according to Hubert Viriot, chief executive officer of Yotel, as consumers are now demanding different services form hotels compared to a decade ago. “One of the thing that we realised a long time ago that was important to consumers, was time and how to remove the 'boring' parts of hotels like long check-ins and outs,” says the Frenchman.
Viriot, who spoke to The Drum before Yotel Singapore’s official launch party, adds that as hotels today need to be far more efficient and processes must be streamlined, Yotel introduced kiosk and smartphone check-ins to make guests’ stay more efficient because they travel all the time, have short stays and they do not have time to waste.
The kiosks, which are equipped with touchscreens and magnetic stripe card readers, allow guests to check-in and collect their room keys, and when they check out, they repeat the same steps. The robots meanwhile, function like personal butlers that takes the lifts by themselves to deliver small amenities like towels, toothbrushes and water bottles to Yotel’s 600 cabins, which is what the hotel calls its rooms.
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Its rooms meanwhile, come with ‘technowalls’ that have adjustable mood lighting and smart TVs, as well as adjustable beds that becomes couches when a remote is pressed. From its premium queen to VIP suite, the rooms are extremely compact, hence, the term cabins.
The rooms are built this way because the facilities that guests are looking for is very different from the old days, says Viriot. “Hotels do not need to offer 10 to 12 different food and beverages outlets, spas and gyms anymore because any well-travelled consumer will have a smartphone or an iPad with all sorts of social apps telling them where and what to do in the cities that they are staying in.”
“This is why hotels need to reinvent themselves because if you look at the hotels that were built in the 60s, 70s and 80s, they are a giant piece of real estate with a lot of rooms, restaurants and convention rooms. All these make for inefficient real estate,” he adds.
Instead, the executive says guests today do not need to do it all in a hotel and just need to connect within the city to be able to go to the restaurants and health clubs that they want. All they need from the hotel are co-working spaces, great breakfasts, ability to plug in their devices and a basic health club, he explains.
Singapore is Yotel’s first expansion into Asia Pacific. It currently operates hotels in New York, Boston and San Francisco, as well as airport hotels in London Heathrow, London Gatwick, Paris Charles de Gaulle and Amsterdam Schiphol.
Viriot explains that as the brand that has mainly grown in the United States and Europe so far, its consumers' point of origin has been many Europeans and Americans. However, since opening its first hotel in APAC, its bulk of guests so far has been Asians even though it is still very early days, says Viriot.
Even though it is in a new location, Viriot says Yotel’s marketing strategy will remain the same. “When we created the hotel from the very beginning, we thought that this new disruptive idea would be popular with a younger clientele, specifically, the millennials. As we started operations, we realised to our great satisfaction that we were attracting several types of consumer profiles.”
“So, age is not a demographic we look at because our guests are young families, millennials, baby boomers and senior citizens. What we want to target is the independent traveller who embraces innovation, enjoys efficiency and are not concerned with quantifying what they pay with the size of their hotel rooms.”
As its guests are usually very well-connected and do most of their research, book flights and hotels on the Internet, Viriot says the hotel does not advertise on traditional media and instead focuses all its marketing budget on digital marketing, which is driven by the hotel's social media and marketing budget, as well as its head office in London.
“We see a lot of people travelling between Singapore, New York, Boston and San Francisco, and as far away as these cities are from each other, people tend to go to all three cities,” he explains. “Our goal is to retain the consumers, which is why our media and marketing strategy is online. That has been reasonably successful because, so far, we generate on a group level about 35% of web bookings from our guests, which is not bad statistics. For our airport hotels, the number of web bookings is close to 60-65%.”
At this juncture, Sahrette Saayman, global marketing and communications manager at Yotel, jumps in to add that that the hotel currently has a few social influencers staying in its Singapore branch and they have done some reviews, which mentioned Yotel’s hotels in New York and Boston.
“That means we are already seeing a cross marketing benefit from using new media and influencers,” she says, adding that Yotel has been very fortunate because these influencers have been approaching the hotel, rather than the other way around.
“For example, after six years in New York, we still have people approaching us to do reviews. We have more budget for PR than engaging influencers."
While Saayman admits that the company has more budget for PR than engaging influencers, she is quick to point out that it depends on the situation. “If we can work with someone on a campaign, we will. It also has to do with the cultural experiences that we put on, whether it is outdoor cinema, bike programs, colouring books etc,” she says.
The popularity of Airbnb and boutique hotels has seen major hotel chains invest in sub-brands that offer different experiences from parent brands with unique local flavours, cutting-edge design and innovative technology, similar to Yotel.
However, Viriot remains unperturbed by the increasing competition as he says innovation and creativity are at the heart of the Yotel brand, which means it is constantly innovating. He also points out that as it is a young and fresh brand, the company always try to look at the industry with a new pair of eyes to see what can be improved.
Consumers that are used to staying in more traditional hotels have also embraced what Yotel is doing, which is why all the brands have reinvented themselves, he adds, noting that he has been seeing new brands coming up and the older brands creating more sub-brands to be competitive with Yotel because it pioneered a new segment in hospitality.
“It is very flattering to see brands created like ours, which means that we are doing something right. Having competitors makes our growth story easier because it is more straight forward to explain to investors and realtors, what we are doing is not just a crazy idea, it is scalable around the world,” he says. “Competition also forces us to keep on reinventing ourselves and improving our brand, not resting on our laurels after creating something great. New concepts come in all the time, so we must continue our innovation, plan how we can continue pioneering this segment and improve it.”
The bespectacled Viriot highlights that Yotel is also very unique because it remains completely independent. He reveals that the company has been approached by major chains, but asserts that it is not embracing the ‘darker forces’ of being a part of a bigger organisation anytime soon because the company stills want to keep its independent and entrepreneurial mindset.
“This is a very new concept of hospitality and sometimes, I feel large organisations can walk in here and redesign their hotels in the same way, but it is not just about the design. It is also about how to operate it, what consumers you are targeting and why there is a lot of things we do not do,” he says.
“If they try to do what we do, but without the same thinking and older processes, it may look the same, but it won't feel the same,” he adds with a chuckle.
As hotel chains like Hilton have seen their mobile app bringing in 20% of all bookings, what is Yotel’s mobile app strategy and how much of its bookings come from mobile?
Viriot reveals that most of Yotel’s investments today are in mobile applications because it is seeing its guests’ booking patterns shift from desktops to laptops, and to smartphones. “That is why we had to reinvent our website a year ago to be completely fully mobile friendly and now we are introducing our mobile app to allow our guests to do much more than just booking a room, but also control their stay before, during and after,” he explains.
He adds that as building a mobile app is not easy because tech evolves very quickly and requires big investments, the company constantly conducts research and organise focus groups to understand what consumers want when they travel and how its app can help them.
“We are not perfect yet, but mobile is the future. When you enter Asia, you discover what works well here and it is different from in Europe and the US. In China, it is a completely different model and we are still in the process of learning it. Being a global company, we need to understand these environments and define our digital roadmap accordingly,” he explains.
“Apps like WeChat are very Asian-based, they are not used in the US, so for us, it is a learning curve,” he adds.
The impending new year will see Yotel grow the positioning of its Singapore hotel, improve its penetration in the Asian market and introduce the Yotel brand to Asian consumers outside of Singapore, according to the chief executive.
“We have a business development team based in Singapore, who are actively looking for new opportunities to grow our company. We are here to grow a global portfolio of hotels, it is not a one-off event, which is why we are focused on looking for other opportunities to grow the brand in different parts of Asia Pacific like Japan, Hong Kong, Australia and India,” he explains.
“Those markets have very clear opportunities for us and hopefully, in 2018, we will have new projects coming up in this part of the world. All this while we are growing our brand in Europe and North America, where we will have six new hotels opening next year,” adds Viriot.
YotelAir, which is the company’s airport hotel, is also slated to open at Changi Airport in 2019. Since there is already a hotel at the airport in Crowne Plaza, how will Yotel differentiate its offerings?
Viriot explains that as hotels that are around airports usually cater to businesses around the airport, YotelAir has a very unique positioning because it is located inside the airport and caters exclusively to airline passengers. “We are an extension to the airline, while their passengers are transiting in Singapore for a short stay, if they have an early flight or late arrival. That makes the YotelAir concept so unique,” he says.