What Price Service During Asia's Slowdown?

<B> What Price Service During Asia's Slowdown?</B>

By Jim Schultenover

<i>Jim Schultenover is vice president of sales and marketing for The Ritz-Carlton Hotel Co. L.L.C., Atlanta.</i>

There is a fire sale mentality going on among many hoteliers in Asia right now, as the faltering economy has caused a decline in business travelers, especially from neighboring Asian nations. Just looking at the May issue of Conde Nast Traveler tells the story with these cover headlines: Asia on Sale, Bargains from Tokyo to Thailand. One Sunday in April, both The Los Angeles Times and The New York Times devoted their travel sections to opportunities for savings in the region. It's no wonder some corporate travel managers feel the name of the game in Asia right now is Let's Make a Deal.

While we certainly understand that everyone cares about price when sending clients to what has traditionally been an expensive destination, it is important to keep things in perspective. We have only to look back to the late '80s and early '90s, when recession jitters caused many hoteliers to skimp on amenities and reduce staff, to recognize the folly of becoming mired in doom and gloom scenarios. While it may not matter to the guest if you trim the size of the lobby floral arrangements, they are certainly going to notice if their room service is delayed because bargain rates have caused bare bone staffing levels. Many hotels that drastically cut service during the recession found the customers they thought were repeat guests simply took their business elsewhere and never returned.

Service cutbacks in Asia will be especially noticed by corporate travelers who have become accustomed to some of the finest personalized service in the world on visits to Singapore, Hong Kong and other Asia business capitals.

When corporate executives arrive in Asia, they are already feeling the strain of world-class jet lag. The last thing they want to be told after a journey of 24 hours is to sit in the lobby because their rooms are not yet cleaned. No matter how abject the apology, weary CEO road warriors won't appreciate any hotel that fails to deliver their faxes or messages on time. The corporate travel manager is sure to hear about it if the hotel fails to deliver the expected service level. Chances are the fact that the hotel offered the cheapest rates will not console a boss who believes service is the ultimate amenity.

Ritz-Carlton, like all hotel chains in Asia, has certainly had to face the effects of the changing economy on the business outlook. We have chosen to avoid the temptation of drastically slashing rates, looking instead for ways to add significant value. In the highly competitive city of Kuala Lumpur, where luxury hotels are all under $100 a night because of the large room inventory, we piloted a 24-hour stay program for guests. The response was so positive, we have extended it to our other Asian properties.

It would have been great to have a crystal ball last year at this time when Asia was booming, and all things seemed like they were on a roll that would never end. Some of us may have even forgotten the lesson that the customer comes first and service must always be the priority. Now that the situation has changed, it is important to remember that this economic downturn will eventually be replaced by better times, and that you never get a second chance to make a first impression on your customer.