Raffles Accommodations advertising technique | INSEAD Data


Although at present working six properties worldwide — modest by comparability to sister firms, the Fairmont and Swissotel teams — Johnston says that for Raffles to match the identical variety of properties over the subsequent 5 to seven years, can be thought of “a big quantity”.

“The objective is to develop the model slowly and steadily in markets which can be complementary to one another,” he informed INSEAD Data earlier than addressing MBA college students within the International Chief Collection held lately on the college’s Asia campus in Singapore.

Although he reveals that Raffles will open three lodges in China, France and Saudi Arabia this 12 months, he says the plans had already been within the pipeline for the final two to a few years.

This conservative stance could have one thing to do with the current monetary disaster, which Johnston says adversely affected the Raffles Group.

“Like all companies, and just like the lodge trade specifically, we have been impacted in a reasonably main approach within the final 15 months. So enterprise has been off throughout the board, within the 15-20 per cent vary. There was a shift in momentum in journey patterns. Among the company shoppers that may usually meet two or 3 times a 12 months, both cancelled final 12 months or have in the reduction of of their journey. Some leisure journey has shifted from phase to phase downwards or the enterprise has fallen off.”

“Revenues are down, earnings are down and all people has to share the burden. And it clearly has not been a simple time for any of the constituents. It hasn’t been straightforward for our house owners, our company, or for workers.”

Nonetheless, he believes there are “pockets of optimism”, particularly in Asia. Already, the Raffles Accommodations in Singapore, Cambodia and China are seeing a gradual pick-up in occupancy.

And whereas Asia could proceed to be the money cow for a model that originated in Singapore, Johnston reveals that Europe and the Americas are additionally on the radar for Raffles’ subsequent part of enlargement.

“Clearly with our small base and our Asian base, plus the properties that we’ve within the pipeline, should you consider the cities the place we at present function — Singapore, Beijing, Dubai (and) we’re about to open in Paris — evidently the goal cities for the Raffles model, the place we will make a distinction and we will put a lodge that may be distinctive and excessive worth creation for an proprietor and price creation for us, the first cities that match can be London, New York, Shanghai (in addition to) Tokyo and Hong Kong.”

Whereas “cautiously optimistic” however on the similar time “bullish and optimistic” concerning the trade, Johnston is upbeat about how father or mother firm Fairmont Raffles Holdings Worldwide can pull by from this non permanent setback.

“I believe the lodge trade is a very resilient trade in cyclical occasions. I believe charge flexibility, efficiencies, cost-sharing and saving alternatives are options of environment friendly and good lodge operators. Maximising income by international distribution methods is one thing that the bigger, well-structured operators can do and I believe it stands them in good stead towards the smaller rivals.”



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