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Polo In Perilous Times

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A Perfect Storm: Where Is Online Travel Going?

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A Snap! Crackle! Pop! Review of De Niro

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Undersea Eating

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What Works in Luxury Travel Marketing

Through the year, Luxury Travel 360 regularly published articles about promotions that were creative - and that worked effectively to generate ROI in the form of business driven, publicity garnered, image enhanced, etc. We went back to some of these promotions to see if they were still in place, and still creating brand buzz, or if they had ended to make way for other initiatives.

Here's an update on the staying power of several innovative promotions we covered.

Ritz-Carlton Chicago's  "Stay As Long As You Like" program enables guests to store clothing and other items (including, in one case, a Christmas tree) to ease their packing and unpacking chores.

According to Michele Grosso, the general manger, "The program continues to be an extremely popular service for our frequently returning guests. We have storage closets full of their clothing and other items -- one guest even stores a guitar with us. We not only store their items, we place them in the guest rooms according to their preference. And when they leave, we pack up the items for them.

From the Media-Snapshots on Luxury Marketing

But Luxury Travel Connoisseur Karen Weiner Escalera says Value Added Alone Is Not Enough

 

Karen Weiner Escalera, president of the KWE Group in Coral Gables, one of the most insightful thinkers on luxury travel, told an industry newsletter in an interview that, "Early in 2009, many marketers thought that offering "value adds" would be enough - i.e. a four-night stay for the price of three, a resort credit, a free dessert when ordering an entrée, etc. As the year progressed, it was obvious that these initiatives weren't enough. The overall rate had to be priced right as well."

Escalera continued, "The winning combination is value add and the right rate.

I am not accustomed to seeing such verve from parent paper Wall Sreet Journal, but editor Tina Gaudoin gave us a treat with her take on The Changed State of Luxury. My favorite nuggets:

  • ..."Luxury goods houses will have to rethink the way they appeal to us, the consumers, in order to survive. In which case, we're talking better value and maybe even lower prices. But will this approach ultimately devalue the meaning of the L word?" PS > Editor Gaudoin thinks not.
  • ...‘People want value for money in every single market, says Chloe' CEO Ralph Toledano. 'Pricing is a key issue we are working on'.
  • ... "You couldn't go to a cocktail party and say you just bought a $25 million dollar apartment. Now you can---as long as you got 30% off'.
  • ...'It's just a question of time before China will be a luxury car market on par with the U.S.,' says the VP of marketing for BMW in China

For more, visit wsjmagazine.com

- Hershel Sarbin

Luxury Travel Issues and Insights

1) Luxury At Its Low Point

Just as after 9/11, luxury hotel occupancies and rates tumbled faster than the rest of the industry and many questioned the very viability - and even future - of that segment. Joe Brancatelli, editor of Joe Sent Me, the website considered the voice of the business traveler, told us, " Every rule is off the board now as far as where people stay. While many business travelers are staying in lower categories other are asking, 'If I can get a Hyatt for $49 a night, why not.' He added, "The industry is not getting the message that we won't want to pay for frills that we don't want. We don't need five-ounce bars of Bulgari soap."

According to Brancatelli, one of the top luxury chains had closed "all its fancy restaurants." He noted that, " When the Mandarin Oriental opened in New York at an $850 rate, nobody sneezed; now if a hotel asks that rate, people laugh."

" My plea," Brancatelli concluded, "is for real luxury at a real price. It's just like the price of a business class airline seat - if you take away the markups for all those extras that many travelers don't even want, it could be much more affordable."

 

Voices & Views

When it comes to hotel industry conferences, Jim Burba is the man to see and he is also a good man to listen to because he is in constant contact with all the industry's big players. His Burba Hotel Network runs a cluster of high-powered conclaves every year. They range from the very well attended Americas Lodging Investment Summit in San Diego in January to the Hotel Investment Conference Asia Pacific in Japan; also on the agenda are conferences dedicated to the Caribbean, India, Central America and Southeast Asia.

At the 2009 ALIS conference, at the very lowest point of the economic crisis, Burba shook things up predicting "Heaven in 2011." He was not referring to luxury specifically, but he did tell LT360 in an interview that, "If you take a longer view, if you can get through this period as a luxury owner you will be in a good position. With luxury having been so tied in to mixed use and residential project, which is not happening now, there will be great opportunities for those who do manage to maintain a luxury product."

Burba also agreed that the affluent represent "a great opportunity to reach into another market. You can get them to know you; the tricky question will be how to keep them."


 

From the Editor

A year that began with warnings about "the end of luxury" is ending with headlines about "surge in demand for luxury" (Smith Travel Research) and "Luxury Makes a Comeback" (Fortune Magazine).

Looking forward, we are focused on lessons learned during the Great Recession by smart luxury travel marketers and experts who shared their experiences –and their counsel—in LT360 columns and stories during these challenging times.

Senior Editor Harvey Chipkin and I have used boldface black—a hopeful color for the coming year—to highlight smart marketer themes, actions, and adaptations below that will pay large dividends going forward.

Read Luxury Leaves 2009 Behind, Looks Ahead to 2010 for more information. 

In today's commentary we share thoughts from a recent conversation with Mary Gostelow, editor of KIWI's online WOW Report. They don't say "Affluent", but they sure point to a more sensible, and comfortable travel culture to come:

 

  •  Everybody was using luxury for everything. We've been living in a time of growing excess which was not really necessary. Why should bedrooms get bigger and bigger? Why should the thread count of sheets get higher and higher? Who cares? Does anybody even know what thread count means? Why should one hotel's terry bath towels get thicker and more sumptuous than anybody else's? You know, it was as though everybody was going for the Guinness Book of Records the whole time.

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