ORLANDO, Florida—NH Hotel Group is using technology as the cornerstone of a five-year strategic plan to expand its global footprint.
Madrid-based NH’s approach has been to carve a technology driven niche in the meetings space to differentiate it from its competitors, said Rufino Pérez Fernández, chief commercial officer, during a break at the recent Global Business Travel Association annual conference.
“We are obsessed with delivering the right experience. Technology is one of the pillars, one of the tools that you can use,” Pérez said. “Technology is a tool, so you need to have a purpose. Our purpose is to provide the best possible experience.”
At the forefront of the technology platform is NH’s Smart Room system that allows for the integration of onsite attendees and up to 250 remote users to have the same experience during meetings. The remote users can access the meeting using a number of devices, including mobile smartphones.
“Most customers don’t have this type of technology at their office,” Pérez said. “Twenty-five percent of our revenues come from meetings, so we have to pay a lot of attention to technology and services available to enhance the experience.”
NH hosted 113,000 meetings at its approximately 400 hotels during 2014. The company has properties in 29 countries comprising nearly 60,000 guestrooms. The Smart Room meeting technology package is installed at six hotels, with nearly a dozen more expected to be equipped with it by the end of the year, the executive said.
Hybrid meetings are a trend meeting planners are demanding, and emerging holographic technology enhances the experience, according to Pérez. The holographic technology was introduced last fall at the NH Collection Eurobuilding Hotel in Madrid. Pérez said the hotel is a bellwether property for business travelers, and technology is an important piece of that puzzle.
Technology is just one of the forces driving the company and its four brands—NH Hotels, NH Collection, Nhow Hotels and Hesperia Resorts.
NH is utilizing its Nhow lifestyle brand as a stepping stone for more growth as well. Properties are open in Berlin, Milan and Rotterdam, while contracts have been signed for hotels in Santiago, Chile and Amsterdam, Pérez said.
“One of the identities of the brand is inclusiveness,” Pérez said. “We want every kind of consumer to be welcome there and feel they belong.”
In addition, meetings and events will be a core part of Nhow’s makeup—a unique attribute for a lifestyle brand, according to Pérez.
Paying close attention to growth
The company is in the second year of a five-year strategic plan that includes 24 initiatives, according to Pérez. The main objective of the plan is to grow the size of the company.
The company’s primary footprint is in Europe (323 hotels comprising 48,716 rooms) and Latin America (57 hotels comprising 10,289 rooms).
NH Hotel group in February announced it acquired Colombia-based Hoteles Royal for €65.6 million ($74.9 million). The acquisition expands the company’s presence in Colombia, Chile and Ecuador to 21 hotels from two. Eleven of the properties have already been rebranded as part of the NH Collection, Pérez said.
The company is entering the U.S. market with an upper-upscale project set for New York City. The future NH Collection property located at Madison Avenue and 38th Street will close for six to nine months on 1 December to undergo a full renovation, Pérez said.
“In the U.S. we are targeting mostly New York because it is the epicenter of our global accounts,” Pérez said. “The second target could be Miami because of the traffic between southern Europe and Latin America is huge.”
Beyond continuing to build its footprint in Europe and the Americas, NH Hotel Group will focus on adding a presence in China. In late 2014, the company signed a memorandum of understanding with The HNA Group for the joint management of a significant portfolio of HNA and third-party hotels in the middle and upper-middle segments of the Chinese market. HNA owns nearly 30% of NH’s equity, Pérez said.
The agreement starts with NH operating six HNA hotels comprising 1,312 rooms under the name HNA-NH Hotel Management Joint Venture Company. The new company will design a prototype hotel for tackling growth in the market under the NH brand and will define a strategic plan to boost its development.
The importance of recognizing key markets and focusing on growth there can’t be underestimated, according to Pérez.
“We cannot be everywhere; we cannot be distracted by tapping business everywhere,” he said. “So we’re selective in location, but the second half of the five-year plan accounts for lots of growth. The first three years is about transforming the company’s focus; in years four and five the main target is to boost growth.”
NH owns or leases 75% of its hotels, Pérez said. That’s an important point because of the local flavor each one must possess. The other 25% of its portfolio consists of managed hotels. It does not have a franchising program, but Pérez said the company “is always open to study opportunities.”