Steady in Tough Times

The Ritz-Carlton Hotel Co. sticks to its promise of outstanding service — and weathers the worst downturn in decades.

Financial & Insurance Meetings: The luxury segment took a big hit in 2009 — particularly in regard to meetings business — and Smith Travel Research predicts it will be hit even harder in 2010. How is Ritz-Carlton responding to this?

Ezzat Coutry: Overall, we actually saw some improvement in the third quarter of this year, and we think some hotels will continue to improve next year. However, this downturn is lasting longer than expected.

In regard to meetings business, of course we have seen plenty of cancellations. Most of our group business in 2009 has been last-minute meetings. But we remain committed to group business. At Ritz-Carlton hotels, 40 percent to 50 percent of the business is focused on meetings, depending on the property. Our hotels average 350 to 500 rooms. I think that starting next year, there is going to be pent-up demand both for corporate meetings and association meetings.

FIM: We're still dealing with the huge perception issue of people equating “luxury” with “excess.” Do you see the “AIG effect” becoming less important any time soon?

Coutry: I think that the perception issue is gradually going away. Right now we are hearing less and less public comment about meetings being held at luxury properties.

FIM: And yet the stigma attached to meeting at luxury properties is particularly bad for financial companies. Do you think that those financial companies having meetings at Ritz-Carlton hotels will continue to “fly under the radar” indefinitely?

Coutry: I think that few companies are really holding their meetings completely under the radar. Financial companies, like other types of companies, hold meetings for very specific purposes — to motivate employees, to bring in customers, etc. — and most develop business cases to justify their meetings.

FIM: The perception issue has been so damaging that some hotels have taken “resort and spa” out of their names. What do you think of this as a marketing strategy?

Coutry: I think this is a response to the public rhetoric and might make it easier for some companies to justify holding a meeting at a specific hotel. At Ritz-Carlton, it is not something we are doing or considering. Our hotels are typically destination driven — The Ritz-Carlton, Philadelphia, The Ritz-Carlton, Cancun, and so on. The destination is part of the name and it is what attracts the customer.

FIM: How has Ritz-Carlton made up for the downturn in the luxury segment?

Coutry: Our leisure business has been spectacular and has saved the day. We're also seeing a strong wedding business.

FIM: Are new hotels still in the pipeline?

Coutry: Although some projects have been abandoned or delayed, and some flags are changing, Ritz-Carlton development has not stopped. New hotels are opening in 2009 in Lake Tahoe [Nev.], Tucson [Ariz.], and Charlotte [N.C.] — along with three openings in Asia. In general, the luxury segment is a small one. Recently, supply has exceeded demand. But this is not going to continue.

FIM: What final words would you like to leave with FIM readers?

Coutry: I would say that our commitment to service, both group and leisure, has not changed. Despite the cost cutting that everyone is going through today, we have not cut costs in a way that impacts service. In fact, our guest service satisfaction studies are higher than ever, with scores that improved this year compared to last year.

And we really focus on our relationships with our meeting planners and on delivering their objectives. The economy has not stopped us from continuing our annual industry-specific client educational events such as the Ritz-Carlton Insurance Advisory Board meeting.


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  • The Greenbrier in White Sulphur Springs, W.V., has named Todd Gillespie director of sales. Having previously served as national sales manager at The Greenbrier, Gillespie's most recent position was director of sales for the Ocean Reef Club in Key Largo, Fla.

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