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| Carlson COO Thorsten Kirschke discussed the Carlson Rezidor Hotel Group’s expansion strategy Wednesday during the group’s brand conference. |
PARADISE ISLAND, Bahamas—Midway through a five-year strategy to clarify its family of brands, the Carlson Rezidor Hotel Group made some significant headway this week when it announced 13 hotels in the London area will be converting to Radisson Blu.
The Edwardian Group signed a contract to convert 13 hotels in London and Manchester to Radisson Blu just days before the Carlson Global Hotel Business Conference in the Bahamas. Executives on stage Wednesday said the hotel group is “painting London Blu.”
“It’s incredible—we signed the papers (Tuesday); the day before us walking on stage,” said Thorsten Kirschke, executive VP and COO for Carlson Hotels in the Americas.
Gordon McKinnon, chief branding officer for Carlson, called the deal “massively significant” for the Radisson Blu brand, which has 229 hotels in operation globally and 76 in development.
Defining the Radisson brand is a major undertaking for the new Carlson Rezidor Hotel Group, a mishmash of privately held Minneapolis-based Carlson Hotels and the publicly traded Belgium-based Rezidor Hotel Group. The two combined names and strategies in January after working as partners but separate entities for nearly two decades.
“From what we have heard, people thought it should have happened long ago,” said Kurt Ritter, president and CEO of Rezidor. “Yes, we’re proud we did it, and we also feel a bit guilt we only did it now.”
Particularly in the Americas region, Carlson Rezidor’s Radisson brand has struggled to standout in a crowded upscale segment, which includes competitors such as Sheraton and Crowne Plaza.
Executives decided to build up the Radisson Blu brand in the U.S. to help consumers distinguish the best of the portfolio. The flagship Radisson Blu Aqua Tower opened with great fanfare in Chicago in November, and the US$137-million, 500-room Radisson Blu Mall of America in Minneapolis is on pace to open during the first quarter of 2013.
“We’re going to make as much noise with Mall of America as we have with Chicago,” McKinnon said. “It’s going to make the impact that we all want.”
Radisson continues to be the focus brand for Carlson Rezidor, especially as the merger allows for an increased focus on international growth. Radisson will work toward establishing hotels that are “iconic, contemporary and stylish in design,” Kirschke said.
Twenty-five percent of the Radisson brand complete property-improvement plans, a major step toward a “soft refurb” of the brand, he said.
“It’s happening all over the globe and not just (in the Americas) because we have so many visitors from all over the globe,” Kirschke said.
While the flagship properties are being developed in the United States, a main driver of the Carlson-Rezidor merger was the importance of a global footprint. The Carlson Rezidor Hotel Group now boasts more than 1,300 properties worldwide.
“This is not a small company,” Ritter said during the brand conference’s opening session. “The business has become so global that we cannot afford to not have that train of thought.”
Ritter said Radisson’s global growth will mostly come by way of conversions, highlighting successful conversion projects in the United Arab Emirates as examples. “That’s the dream of any developer: when you have a nice hotel that you can just put your name on it and it fits, and you have an existing client base,” he said.
Future initiatives
Carlson Rezidor is in “part three” of its Ambition 2015 strategy and executives at the brand conference provided the 1,200 attendees a review of the goals that already have been met as well as future initiatives that are yet to come.
The 30,000-foot goal—said Hubert Joly, president and CEO of Carlson—is for every Carlson Rezidor brand to be the leader in its respective segment.
“The theme for 2012 revolves around revenue generation, clear strategies for brands and growth in key emerging markets,” he said.
Kirschke said the company’s name change doesn’t come with a new strategy. The company isn’t changing course, he said, but rather is staying persistent on its goals to clarify each of the brands in the portfolio.
“I wouldn’t call it boringly predictable; I would call it persistence,” Kirschke said. “And acceleration of the progress of our goals.”
In 2011, Kirschke said, Carlson Rezidor was able to work toward establishing global consistency for each of the brands and “operationalize” the brand promises. Also, the company accelerated growth and gained revenue market share.
“This is where the rubber meets the road,” he said.
In addition to repositioning Radisson, Carlson Rezidor also will focus some attention on the Country Inn & Suites brand, which has a new brand leader in Scott Meyer and will see new prototype rooms later this year. Executives are studying the brand’s target traveler and are in the early stages of rolling out new designs for the brand.
