merce. Baccarat Hotel is exemplary of this
approach. The namesake hospitality venture
of the French crystal glassware brand opened
in 2015 and launched its commerce pro-
gramme two years later. Every piece of crystal
on display in the hotel is for sale – from the
chandeliers to the champagne flutes to the
candlesticks. Guests at the bar can choose to
browse a food and drink menu or a crystal
menu. Hermann Elger, chief operating officer
of Baccarat Hotels and Resorts, says it’s not
shopping, it’s ‘experiential acquisition’. And
it allows for impulsive, emotion-driven sales.
‘We’ve done some of our largest sales at 10:30
at night on a Sunday,’ Elger told Bloomberg.
‘The chance that a guest is still going to be in
the mindset to make that kind of a purchase
at our flagship store the next morning? It’s
not so likely.’ Baccarat’s hospitality play also
proved something of a transitional moment,
signalling the point at which the spectrum of
out-of-category brands entering this market
expanded from headline luxury brands to
a broader array of lifestyle and homeware
purveyors. After all, if Versace could use a
hotel to sell a table set, why shouldn’t they?
Fast forward to 2019. Those entering
Muji’s latest flagship store in Ginza, Tokyo,
can feast their eyes on five floors of Japanese
minimalism. You could spend hours perus-
ing the 7,000 products on display or you
could skip the browsing and head up to the
sixth floor to spend the night wearing Muji
pyjamas, lying on a Muji mattress, reading by
the light of a Muji lamp. And it won’t be »ski resort Courchevel. In 2010, it formed a
subgroup – the aforementioned LVMH Hotel
Management – to oversee its expansion into
the sector.
The luxury industry was booming at
the time, with sales of personal luxury goods
going from 5 per cent growth in 2004 to 9
per cent in 2006 according to Bain & Com-
pany, but experiential luxury was also on the
rise. For Ortelli, luxury brands made the leap
to hospitality because it is in their very nature
to be experiential. While ultimately they
sell products, their raison d’être is to sell an
aspirational lifestyle. ‘They are selling you an
experience. You don’t go into their stores just
to buy a product, but also to be part of the
brand story,’ he says. Luxury stores’ immer-
sive quality translated well to hospitality. ‘In a
branded hotel, everything reminds you of the
values of the brand – from the furniture to
the uniform of the staff to the fragrance they
use.’ In hindsight that leap now looks like
a prescient, assured step towards ensuring
the brand’s continued relevance. Just take a
look at a Barclaycard report from 2018, which
found that 52 per cent of consumers would
rather pay for a ‘good experience’ than mate-
rial goods. Indeed, money spent on travel,
dining out and entertainment – intangible
and transient experiences – is growing four
times faster than spending on goods.
The difference between then and now
is that the path-to-purchase is less subcon-
scious. Now, brands use hotels to seamlessly
and explicitly blend experience with com-Five lessons for
brands entering the
hospitality industry
➀ There is a scale of involvement
when deciding whether or not to
enter the hospitality space. If a
brand is making a serious move
into the experience economy,
then partnering with a proven
hospitality operator is the way
to go. People tend to forget
that Bulgari Hotels are actually
run in partnership with Mar-
riott, because the touchpoints
all exude the luxury brand.
➁ Outsiders seeking to find suc-
cess in the hotel business need to
be explicit about their intended
outcome. While Vipp brands its
one-room hotels as unique expe-
riences, the company also wants
customers to know that they
exist as alternative showrooms
where products can be tested.
➂ When translating a product
into a spatial experience, nuance
is key. It is about creating subtle
cues that reflect the brand back
to the guests, without creating
a soulless real-life catalogue.
West Elm Hotels achieves
this through bespoke pieces,
created by local designers,
which are sold only online.
➃ The service side of hospitality
can amplify the feeling of loyalty
between brand and customer.
As Doug Stephens notes, if they
leave the hotel with a positive
association, it can impart last-
ing memories of the brand that
may lead to more engagement.
➄ A branded hotel has to have a
point of view in order to stand
out in a crowded market. It
cannot simply be nicely designed
- that just makes it another bou-
tique hotel. It will be the added
extras, the branded amenities
or services on offer that will
make the stay memorable.
Will Louis Vuitton’s
food offer be classic French
or a fusion mash-up
that reflects the decision
to hire streetwear designer
Virgil Abloh?
FRAME LAB 139