ORLANDO, Florida—More than three decades have passed since Bill Marriott made one of the riskiest decisions of his career. It also proved to be one of his most successful.
“We decided to break out of the full-service hotel mode and build our first limited-service hotel, which was Courtyard,” he said Saturday during a general session at the company’s GM conference. “It was a great risk we took—a little 150 (room) hotel room hotel in Atlanta. We surprised everybody. Competitors came out to take a look and said, ‘It wouldn't work.’ And it worked.”
Now celebrating its 30th anniversary, the brand “built for business travelers by business travelers”—to cite the old ad campaign—is reinventing itself to keep pace with an emerging base of next-generation travelers.
It’s an area in which Courtyard was lacking, admitted Janis Milham, the brand’s VP and global manager.
“Over the past three decades we have been on the top of our game … But (successes) haven’t come without a few stumbling blocks along the way,” she said Saturday at the brand conference’s opening general session.
Among those stumbling blocks: falling behind competitors in measures of guest satisfaction and revenue-per-available-room index.
The first step to reverse that flow was a brand-wide lobby repositioning known as “Courtyard Refreshing Business.” What used to be a functional space where guests would simply check-in and check-out was transformed into a social area that encouraged travelers to relax and mingle.
“That really was the most significant stake in the ground,” Milham said later during a media roundtable.
Launched in 2007, Refreshing Business cost owners twice as much as a typical renovation at $750,000. Nearly 90% of Courtyard’s 900-plus hotels globally will have repositioned by year end, with complete compliance by 2015, Milham said.
The new lobby, which features a flexible bistro that transitions from serving Starbucks coffee in the morning to alcohol in the evenings, is a direct nod to the Generation Y and millennial travelers, Milham said.
“These millennial travelers will be our dominant customer segment for the next 20 years,” she explained.
And the results are already paying off. Courtyard has notched gains in both guest satisfaction and RevPAR Index brand wide.
“It’s now just taken off in the last couple of years,” said Marriott’s president and CEO Arne Sorenson during a separate media roundtable. “The bistro provides … simple, good fare to eat, which is open all the time. …
“It’s a dramatically different experience for people, and our guests love it,” he said.
(Credit: Marriott International)
A Gen Next room
With the lobby repositionings largely complete, Courtyard’s executive team turned next to guestrooms.
“(The lobby) was designed as a target to this emerging traveler, this millennial traveler,” Milham explained. “The next piece for us was really the guestroom.”
“We were hearing some comments, quite candidly, that there was a bit of disconnect between what we were doing in the lobbies and what we were doing in the rooms,” she said.
Courtyard brought in consultants to study how younger business travelers use their hotel rooms. Whereas when Courtyard first launched the room was all about getting work done, millennials were seeking comfort first and work second. At the top of the priority list was flexibility—spaces that could adapt on the fly. Also key was connectivity—not just to Wi-Fi but also to power outlets and USB ports.
And on top of that, millennials had a completely different décor preference. Instead of pops of color, they wanted a natural palette with tone-on-tone hues.
Courtyard’s Gen Next room prototype, which was revealed to owners a few months ago and to GMs for the first time Monday, is Marriott’s attempt to hit all those checkboxes, Milham said.
A sense of comfort? Gen Next features a new “lounge around” sofa that’s large enough for guests to sprawl out. Flexibility? The room’s desk is light and on wheels, meaning it can be moved effortlessly next to the bed, in front of the couch or at the central workstation. And connectivity? Marriott is requiring faster Wi-Fi, while power outlets and USB ports abound, complete with handy “tech drops” to hold tablets, smartphones and whatever other device a traveler has brought along.
The color palette reflects the new preferences as well, with earth tones and soft pastels creating an airy, natural feel.
Executives set out to make Gen Next “cost neutral,” meaning it would not exceed the costs of the brand’s typical room renovation required every six years. But the “lounge around” sofa will cost, on average, $500 more per room, Milham said, adding owners approved the cost for the pivotal piece of furniture.
The prototype will begin rolling out in parts with early adapters as soon as this year. By year end, 8% of the portfolio will be Gen Next; 25% will be on board by 2014, Milham said.
While designed initially for North America—a separate European prototype rolled out during 2011—the Gen Next concept has piqued interest from owners abroad. Courtyard has responded by creating a kit of parts for owners in China, Africa and Europe.
“We are really jazzed because everything is pointing for us to be back on track to be the dominating player in our tier,” she said of the updates. “By the end of 2014 we will regain that No. 1 position that we so deserve.”