Marketing Week (MW): What is Dusit International’s approach to growth outside its home market of Thailand?
Rustom Vickers (RV): Dusit has been around for 63 years and is very much a family business. Around 15 years ago, the company ventured internationally with its first acquisition of a property in Manila. This was followed up by a management strategy, taking on the management of a hotel in Dubai. The growth was very much opportunistic.
That has completely transformed over the past four years to us pushing to become a fully fledged international hotel management company. That is our goal, with a combination of both looking at management agreements, where we operate hotels for other owners, but also acquisitions and joint ventures.
MW: How do the characteristics of cities and their inhabitants influence where you expand?
RV: We look at the spending power for the restaurants, bars and anything that is going to cater to local demand. But this will affect only the design of the hotel. It wouldn’t necessarily affect us going in to the city, because travellers will come from around the world.
For that analysis, we look at the local market, what existing hotels are doing, as well as the demand and supply. We are always looking for markets that have high-net-worth visitors, such as the Maldives.
It’s the economic side that drives where we go, and we also look at the safety and risk side of where we are going. The key driver of growth for a hotel company like ours is the doubling effect of what we call ‘cross-feeder markets’. Chinese travellers coming into Thailand will be more likely choose Dusit because they have heard of the Dusit in Shanghai.
MW: Do you have to adapt your hotel designs, service offering or marketing according to the hotel’s host city?
RV: Very much so, and it is sensitive for us because our unique selling point is Thai hospitality, which is quite cultural. We have to be careful, because you don’t want to go to Istanbul but feel like you’re in Thailand. In some places in the world, perhaps that culture is a clash, so we have to be sensitive.
A successful hotel has to be as localised as possible, because the trend for consumers is that they don’t want a cookie-cutter design experience, although there are still those that want the home away from home.
MW: Does the way you manage the brand’s expansion vary in different cities?
RV: Once we have targeted a destination we set up a development office to further that growth. We have a development office in Dubai that looks after Europe, Africa and the Middle East, for example. You have to understand the locality and incorporate it into the design elements and your service implementation. Usually, though, we will partner with a local developer.
Hotels are all about the human capital and the service. If you consider Dubai, for example, at least 80 per cent of the staff are expatriates. You have to bring people in from different parts of the world, and there are different issues associated with that.
If you go to a place like Nairobi, it is going to be the other way round. It is going to be 99 per cent local staffing, and we are going to have to understand the legal side of labour law, the bonus structure and those kinds of details. Nairobi is new territory for us. It is a whole new culture and a new part of the world. For a Thai-operated company, there is going to be a learning curve.
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