Hotel A served the boutique hotel segment. Rather than focusing on market segments in Singapore’s hotel chain scale system, the management decided to offer guests an affordable luxury experience via excellent personalized service while capitalizing on the rich and authentic cultural heritage that the hotel offered in terms of history and design. Although Hotel A had won the Best Hotel Service award three years consecutively, it was getting harder to distinguish itself from other boutique hotels and to align itself with the parent company’s (Company A) strategic long-term goals.
Mr. Lim had been the manager of Hotel A for five years. He worked up the ranks, learning the ropes and garnering accolades for best service, and management skills. He had earned the respect of his staff as he empowered his staff, empathized with them and walked the talk.
Since December 2019, the world had been reeling from the impact of a global pandemic caused by the coronavirus (COVID-19) which was primarily spread through physical contact and respiratory droplets. Most countries implemented very stringent measures to prevent the disease from spreading within its borders. The luxury boutique hotel category in particular had been negatively affected as the hospitality industry focused on people, personalized services and face to face interactions. One prominent change seen as a result of COVID-19 was a change in consumer behavior, influenced by risk perception (Gössling et al., 2020; Kirk & Rifkin, 2020). Guests became more cautious and concerned about safety and hygiene, preferring less human touch during registration and food delivery, and practiced safe distancing from others (Rittichainuwat & Chakraborty, 2009).
Millennials had increasingly become an attractive market segment for the luxury hotel industry as they were not price conscious, preferring to “spend tomorrow’s money” and “spend ahead of income” (Wang, Sun & Song, 2011). Furthermore, as they were digital natives, products and experiences which could satisfy their luxury consumptions could be promoted easily via social media marketing.
In August 2020, the Singapore government rolled out a S$45 million SingapoRediscovers campaign where Singaporeans were given S$320 million in tourism credits to drive local spending (Straits Times, August 2020). Mr. Lim is in a dilemma. How can he promote Hotel A as the preferred staycation destination to local Millennials without alienating its more traditional clientele and brand image as a heritage hotel catering to foreigners? How should Hotel A provide personalized service and maintain service quality and satisfaction with safe management measures in place in sync with Millennials’ lifestyle?
Author: ChienChing Lee, Christina Lam
Cite As: Lee, C and Lam, C. (2021). Curating authentic hospitality in a local boutique hotel. Muma Case Review 6(6). 1-15. https://doi.org/10.28945/4734