The Leading Hotels of the World President & CEO Theodore (Ted) Teng on the evolution of the annual gathering of luxury travel industry leaders
Ted Teng has been attending Virtuoso Travel Week for the past ten years. Virtuoso CEO Matthew Upchurch noted that while before there were a lot of hotel reps attending, now he’s seeing more and more CEOs and hotel owners here. We asked Teng why is this important…
The way I look at it, there are the promise-makers and the promise-keepers. The sales people are making promises, which is great. The people who are really keeping the promises are the general managers and the owners. It’s wonderful for them to be here, to meet the people who are driving business to their hotels. Big hotel companies still tend to send their sales and marketing people to this event. Whereas for us, we are a sales and marketing company, so I come here, as this is our primary mission. It’s wonderful to be here to both see our hoteliers, and to see the travel advisors all under one roof.
Today, at lunch, I was talking to several travel advisors who focus on wellness. So for me to be able to understand what it is they do, this is vital for me. I want to understand their challenges, and what they are trying to accomplish, so that I can influence the way we run our business in support of them… in return they are in support of us. Understanding how that works is very important to us.
Consumers are looking for specialists. It’s like health care. You might go to see a generalist, but when you are looking for something particular, you want to talk to someone who is on the cutting edge of that particular issue… and what’s the best in class in this particular product. I think for that reason it’s wise for travel advisors to specialise because there are so many different offerings around the world.
Why is Virtuoso so important for you?
There are several reasons. One is that the hotel business is one where customers come from everywhere but where the hotel is located; so, you have to reach the world. And nowadays, people are travelling further, they are travelling to new places. So it’s exciting, but it’s also difficult for hotels to reach people directly. If you’re buying commodity items, you buy by specs, you buy by price. But when you are selling differentiated experiences, it takes experts in selling, and that’s where I feel the travel advisors are able to understand their clients’ needs and match them with the right product. OTAs don’t do that. OTAs are basically selling a commodity. Everyone has the same real estate, which is the picture, the number of lines of description, and the biggest real estate is the price. That’s OK if price is the only deciding factor. But for people whose time is valuable, and who are getting together with family, they don’t want to take a chance of having a bad experience. That’s where travel advisors are incredibly valuable in terms of protecting the most precious commodity people have: time.
That’s very much the case in the US, while in Europe the individual travel advisors are not valued so much, as tour operators are more important…
Indeed, around half the travel that’s booked in Europe is booked as packages, and that’s’ fine. But more and more people in Europe, particularly in the luxury segment, are looking to have their time protected. And I’m delighted that Virtuoso is reaching out into Europe, as well as Asia-Pacific, as it will really benefit our hotels.
What’s changing in your hotels as time goes on?
Luxury hotels are getting bigger and smaller at the same time. They’re getting bigger in terms of the size of the rooms, and they’re getting smaller in terms of number of rooms. We have hotels with 20 rooms, 30 rooms, 50 rooms, joining us. And you would think in economies of scale it’s not very efficient, and you’d be right, but they have dedicated, committed people behind them that want to really express their sense of hospitality, and I think it’s harder and harder to deliver that individualised experience for hotels bigger than 200 rooms. So, we are excited to work with some of these very small hotels that are delivering some amazing experiences.
For hoteliers, our market segment is the owners and hoteliers of family-led individually branded luxury hotels. Family led businesses are really compatible with who we are. And the value proposition to them is collective synergies with our chains – allowing them the freedom to express themselves. On the consumer side, our focus is on curious travellers: people who travel to discover. And our value proposition there is to be treated as a repeat guest when you visit a hotel for the first time, because we know something about you, and we work on creating an individualised experience for you.
What’s different about how you work with travel advisors?
We know most of the travel advisors and they know us. Of course, there are always new ones coming into the business, which is great. Our sales function is more of a service function. Some of the travel advisor’s credibility with their client is not just about a booking, but about when something doesn’t go right. When we work with travel advisors, we make sure they are the heroes for their clients. And when this is achieved, their loyalty is to us, and their client’s loyalty is to them. I personally handle travel advisor issues sometimes. Some of them even have my mobile number.
Photo: Theodore (Ted) Teng, President & CEO , The Leading Hotels of the World