Hampton’s entry into Dubai creates brand model for MEA
 
Hampton’s entry into Dubai creates brand model for MEA
21 NOVEMBER 2018 9:12 AM

The Hampton by Hilton brand’s global leaders share how they are capitalizing on guest need and owner and development appetite in the Middle East.

DUBAI, United Arab Emirates—Hotel owners, and prospective owners, wondering what and how a Hampton by Hilton would look and operate in the Middle East now have a model to inspect, the brand’s global leaders said.

The Hampton by Hilton Dubai Airport, which opened in September, marks the brand’s first property in the region. Also the brand’s largest hotel in the world by room count at 420 rooms, the Dubai property also serves as an example of scalability, said Shruti Buckley, SVP and global head of Hampton by Hilton.

Already the property has generated a lot of interest from owners, who have visited to tour the hotel, she said.

“We’re really excited that now we’ve got a showcase property to be able to tell the Hampton story in a real way and how it’s coming to life in the Middle East,” Buckley said.

The brand is poised to take advantage of an appetite for development in the Middle East, with 17 hotels in the pipeline in the region, including two in the United Arab Emirates—one in Dubai and another on Marjan Island in Ras al-Khaimah.

“Now that we have one open and brand awareness, we look for that pipeline to accelerate,” Buckley said.

Why Dubai?
The timing is right and Dubai is the perfect gateway into the Middle East for the Hampton brand, she said.

“The marketplace is proliferated with luxury and high-end hotels, and it is really exciting to see in the last few years how there’s been this incredible influx in demand for quality, moderate-priced, affordable lodging,” she said.

“That’s a really exciting trend we’re seeing, and a brand like Hampton really has an opportunity to set the bar in that midscale category and really create an option for those consumers who are looking for branded quality product at an affordable price point.”

That Hampton offers a midscale price point for a product that consistently sits in the upper-midscale to upscale tier in quality positions the brand for success in the region, Buckley said.

“What we’re seeing globally, and here in Dubai, is consumers who can afford to stay in luxury (but) are opting not to, because they prefer to spend their money in experiences,” she said.

Hampton joins seven other Hilton brands, with 14 hotels total, in Dubai. That it’s taken nearly 35 years (the brand was founded in 1984) to bring Hampton to the Middle East is in line with Hilton’s overall development strategy, Buckley said.

“Strategically, Hilton’s point of view is to go, especially in new regions, and establish ourselves from a full-service perspective, and as those markets mature and we see that growth in demand in the mid-tier segment, that’s when we’re able to come out with Hilton Garden Inn in the upper-midscale and then Hampton,” she said.

“We’ve established Hilton as one of the strongest players in the industry here. It’s well-known, well-recognized … so now the opportunity to come in with Hampton to meet a need of guests that we just weren’t able to attract before is really great.”

Dubai, in particular, made sense as a market for the brand because of its burgeoning tourism and wealth of demand drivers, Buckley said, noting that the city has a vision of welcoming 20 million tourists annually by 2020.

One factor driving tourism is an increase in airline stops and direct flights to Dubai, she said.

With its proximity to the airport, the Hampton Dubai Airport is positioned to capitalize on that traffic, while also being easily accessible to the city’s business districts and tourist destinations, said Nayla Chowdhury, the hotel’s GM.

Different but the same
Those advantages were identified through brand research, which is common when entering any new market, Buckley said. That research also yielded consumer insights, which factored into some regionalization of the Hampton brand for the Dubai property.

Most brand standards are maintained, but what differentiates the Dubai hotel and other Hamptons starts with its size.

The size of the hotel dictated the need for a larger fitness facility and pool area, which also was a key consideration given the climate of Dubai.

“From someone’s perspective who’s used to an 80-room Hampton, they may come here and say, ‘Wow, this is really elevated,’ but really when you think about it, it’s just sized appropriately for the number of people we have in the hotel,” Buckley said.

“The other opportunity we identified through the design phase was to make sure the outdoor space around the pool area was also increased because it’s a tropical climate. It’s warm; the pool will get quite a bit of use, versus a lot of times in the U.S., it’s very seasonal. That also becomes an entertaining space for people to hang out and spend time.”

There are also plans for the hotel, which already features a 24/7 dining space as well as a restaurant bar concept, to introduce an outdoor F&B space in the pool deck area, Chowdhury said. The bar venue was identified in market research as a particular need by international guests, she said.

“We actually do have bars in limited locations in the U.S. … a handful of them. When you think about 2,200 units in the U.S., it’s a small percentage that have bars,” Buckley said.

“But we are mindful that when we go into even a larger city, oftentimes there’s a need. It’s not a three-meal-a-day restaurant experience; it’s a bar with some small plates. When we looked at Dubai, in terms of the experience, we learned we definitely have to have a bar in this location in terms of how we regionalize it.”

Menus for the hotel’s F&B spaces, including for its signature Hampton breakfast buffet, are another area where some regionalization is at play, Chowdhury said.

For breakfast, international dishes, particularly Indian and Chinese, are rotated on the menu to suit that guest demographic. At the hotel’s Brick Street bar, a menu of street food also rotates periodically to feature favorites from around the world, she said.

“It’s very challenging, but also very exciting to be able to meet and cater to so many guests, while also trying to make sure that we are staying within the swim lanes of what a Hampton is,” Chowdhury said.

That means, though the hotel has multiple F&B spaces, “the offerings are still fairly confined,” Buckley said. “We don’t have room service, for example,” because that’s not a Hampton brand standard. The hotel’s F&B outlets “still meet the guest needs, but you don’t have 20 items on a menu like you would find in a full-service hotel,” she said.

The unique needs of the region also played a part in the sizing of guestrooms at the Dubai property, she said.

“When we look at Europe and the Middle East, our prototype actually has a 21-square-meter room. In the U.S., it’s a larger room,” Buckley said. “When you look at Middle East travelers, yes, you have your business travelers, but the families that are coming in are oftentimes larger families, so you’ll find the rooms are between what a U.S. size would be and what you would find in Europe.”

Where else?
This research and regionalization is also being applied to other new markets in which the Hampton brand is being developed and expanded.

Buckley cited as highlights the brand’s entry into France and Brazil, and openings targeted for next year in Argentina and Peru.

“I’m really excited because we’ll be entering Paris in the next month, our first entry into France, which is fantastic. Again, a global city with a lot of feeder markets from a lot of big countries that are already familiar with the brand,” she said.

“It is great to see this brand go into some of these really exciting destinations and do extremely well. Dubai is a fantastic example—couple of months open, ramping up already, owner return, over 80% occupancy, and those are the kind of numbers we see when we’re going into some of these locations.”

Meanwhile, the brand continues to expand in markets where it’s already well-established, including in North America, Buckley said.

In the U.S., particularly, “it’s fascinating because there are so many now of these secondary, urban markets that are burgeoning and growing, and they’re creating these really cool, mixed-use developments, and Hampton is the ideal product to go into these places,” she said.

At the same time, she said, “there are some markets which used to be a Hampton market, 20 years ago, and no longer are. … The economic environment has moved on, and we’re saying now it’s time to exit that Hampton, but let’s bring in a Tru. So there’s good balance there.”

Top markets that the brand is focusing on include Asia and China, where Hampton is “the fastest growing hospitality brand with 52 open units,” she said, adding the goal is to have as many as 100 hotels in China by the end of 2019.

“India is definitely a really interesting opportunity for us,” Buckley said, adding that the reason Hampton is not yet established there is “we wanted to make sure the Hilton brand, some of the full-service brands, were firmly established there” first. “Now it’s a really great opportunity to go back and explore that midscale component,” she said.

“In Europe … we have good representation—Germany, Poland and the U.K. are our three biggest markets—but we see massive opportunity because those hotels are performing so well that owners are really excited, and there’s a consumer need for that Hampton product. So you’ll see more of that coming. Eastern Europe now is emerging, growing, with lots of great destinations people want to go to. We’re looking to grow our portfolio there, and then in Central and South America, which continue to be key markets.”

Editor’s note: Hampton by Hilton paid for travel expenses, and provided accommodations and meals. Complete editorial control was at the discretion of the Hotel News Now editorial team; Hampton by Hilton had no influence on the coverage provided.

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