Give boutique a break – analysing a hospitality concept

1st January, 1970

Give boutique a break – analysing a hospitality concept

In an increasingly crowded marketplace where even economy hotels sell themselves as lifestyle brands, does the boutique concept still mean anything? Patrick Kingsland asks Kike Sarasola, Room Mate Hotels founder and president, and Filip Boyen, chairman of Small Luxury Hotels of the World.

When Kike Sarasola founded the hotel chain Room Mate Hotels in 2005, the word boutique meant something very clear to the Spanish entrepreneur. “It was about extra good service,” he says matter of factly. “It didn’t matter if you were five stars or four stars; it was about someone who really took care of you.”

As a company that wants its hotels to feel like your “friends’ house”, it was a label Sarasola, a former athlete and Olympian, was certainly happy to adopt. “At the beginning, I would consider us to be a boutique hotel chain,” he says. “It made sense because we were really offering that extra kind of service.”

Over the years, though, his attitude began to change. Hospitality buzzwords like ‘experiential’, ‘social hubs’ and ‘service-driven’ became totally ubiquitous in the industry, diluting the power and meaning of the term boutique.

“The whole thing got out of hand and I think the concept it is now completely outdated,” Sarasola says. “Suddenly, everybody started using the term no matter what. People just assumed it was about size, about being small.”

That focus on size proved particularly limiting for Sarasola, whose company expanded and began to add larger hotels. The service it was offering remained the same – “in all our hotels, we were giving that extra service and extra smile” – but the tendency to see boutique and smallness as one and the same thing forced Sarasola to reassess the relevance of the term. “For me, it had just passed its use, he says. “We needed to find something different.”

The idea for an alternative came to Sarasola, he says, one sleepless night while musing on the unfortunate likeness between the words ‘hospitality’ and ‘hospital’. “What I give my customers is happiness, so I thought instead of calling it hospitality, why don’t we call it ‘happytality’,” he says. “It is a word that Room Mate has since registered and that we are now actively promoting. We are no longer a boutique hotel, we are a happytality chain; we make our clients happy.”

The end of identikit

Of course, not everyone has given up on the idea of boutique hotels quite so dramatically. While Filip Boyen, chairman of Small Luxury Hotels of the World admits the word has changed over the years, he believes the concept still holds currency in the contemporary hospitality milieu. The trick, he says, is implementing it properly.

“Firstly, I think sense of place is key,” he says. “Boutique hotels need to be very representative of their locations. That doesn’t mean putting a picture up of a local artist in the lobby. It means the customer should be able to tell where they are in the world without even looking out their bedroom window. Secondly, I’d say informality is also more and more important for boutique hotels. Particularly with the younger clientele, people don’t want to go back to their bedrooms at 7pm and they don’t want to get all dressed up for a gourmet restaurant. We have people sitting at the bar with their kids in jeans and t-shirts because they are comfortable like that. Hotels have to learn to be that flexible if they aren’t already.”

For Boyen, the rise of a new generation of well-travelled, design-conscious customers that reject generic experiences means the boutique concept is still very germane. “We now have a big niche market of millennials who are looking for much more experience-focused travel,” he says. “They want to be connected with the communities, they want to know what it is like to be a local for a couple of days and they want to come back home and feel enriched, like they have learnt something.”

While Sarasola may contest the usefulness of ‘boutique’ as a label, he agrees that millennials and design-savvy travellers are also changing the hospitality market in a way that suits the culture and philosophy of independent hotels.

“In the 1990s, before the internet, people didn’t really know what kinds of things you could expect to find in hotels,” he says. “They didn’t have the information and so they just went for what was standard: a Four Seasons, a Hilton, a big brand where you knew what you would get. Then, in the 2000s, everything changed. Suddenly, because of the internet, people knew what they could expect and everything became about experiences, the search for something different. People now don’t want to have the same experience travelling to Madrid, New York and London. They want something different in every room, in every bathroom, in the whole experience. I think that is the future for where hotels are going.”

Big brands go boutique

With so many people searching for those experiences it’s unsurprising that big brands have been trying to get in on the act. “The paradigm has shifted in recent years and the larger chains have recognised that there is this niche market,” says Boyen. “They obviously didn’t have that segment in their offering and that is why they have all – practically without exception – started or purchased smaller, boutique hotel chains or groups.”

The process began in 1998, when Starwood became the first major hotel operator to develop a boutique concept with its flagship W brand. Others soon followed. More recently, though, big chains have been buying existing brands instead of building them from scratch. In December 2014, for example, IHG, at the time the world’s largest hospitality group, acquired Kimpton Hotels, the “first boutique hotel and restaurant company in the US”.

“In France and Spain, the big chains are also trying to buy these different brands and put them into their portfolios,” says Sarasola. “That’s because they know it is much more expensive to build up a new brand. I think it shows that we are doing the right thing. We’ve already had three offers and we’ve said no.”

As well as adding competition to the market, the presence of big brands in the independent space has also challenged what being boutique actually means. Can a company like IHG, with 742,000 rooms in nearly 100 countries, really offer a traditional boutique service? Sarasola thinks not. “The problem with these big brands is that they have they no soul,” he says candidly. “That’s the difference between my hotels and a big multinational: mine have soul and these major brands are just lifestyle copycats.”

While Boyen believes the big brands are “doing a great job”, he also says the way they are structured makes offering a genuinely boutique service a major challenge. “I think it has been proved many times that they struggle to differentiate their boutique offering from what they originally did,” he says. “After a while, we see the original standards and procedures that they have in place at their bigger sister or brother companies sneak in. And that takes away from the welcoming feeling and the spontaneous service that a boutique hotel should have.”

By comparison, at Small Luxury Hotels of the World, Boyen says individuality in terms of service and design is actively encouraged. “The GMs and owners in our portfolio know that we want them to be very individual, very quirky, and to offer the best possible experiences,” he says. “And unlike the big brands, we have lots of hotels that have been with the same owning family for generations. For example a couple of weeks ago I was in Italy visiting our hotels. In Monza, we have a place that has been in the same family for four generations; the love they have for hospitality and great food is just amazing.”

For Boyen, as the major hotel chains continue to create or acquire new boutique brands, it’s precisely that kind of backstory that will allow champions of independent hotels to remain differentiated and relevant to the new generation of travellers. “When it comes to the client’s experience, I think there is a big difference between us and the big brands,” he says. “We have hotels that are not just representative of the local community and local destinations, they are embedded in it.”


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