Suave Bulgari’s Hotel Strategy with Marriott More than Meets the Eye

Following hard on the heels of its Beijing opening in September last year, Italian jewelry brand Bulgari added a Shanghai hotel on June 20. The opening saw Bulgari’s total number of properties, done in partnership with hotel giant Marriott International, double from three to six over the past year, with new luxury hotels scheduled to open in Moscow, Paris, and Tokyo from 2020-2022. At first glance, with China already rich in Four Seasons and Ritz-Carltons, and fashion houses from Versace to Armani to Fendi opening their own branded high-end hotels worldwide, this would seem the last thing China needed. But perhaps not. Headquartered in a Belle Epoque-era building lush with green onyx, Roman marble and contemporary Italian interior design, Bulgari Shanghai was able to open charging starting room rates about 40 percent above Marriott’s own premium Ritz brand and rival Peninsula’s. And Bulgari’s quick addition of not one but two China hotels in less than a year is indicative of what a good bet the branded hotel concept appears—at least to the jeweler—in a country where high-end hotels and luxury brands have both enjoyed tremendous growth. General Manager of the hotel, Vincent Billiard, told Jing Daily. “Every luxury brand is growing in China, not only hotels. The fact that the Bulgari brand has grown very well, and the hotels have been implemented here, working hand in hand, it’s just the right place to do it at this time.” A Trojan Horse? Bulgari broke into the hotel business in 2001 after forming a joint venture with Marriott, which manages some luxury brands but is better known in the United States for its cookie-cutter corporate hotels. Their new hotel is part of the SUZHOU HE development by Chinese property giant OCT, a 10.6 billion publicly listed company overseen by state-owned parent company OCT Enterprises. While the grounds include apartment buildings and expansive gardens — helping insulate guests from the rundown Qipu Lu fashion market across the street — the hotel itself comprises the top eight floors of a 48-story tower and the historic Shanghai Chamber of Commerce. To what extent a luxury brand connection makes hotels more desirable, and how much the hotels help sell products, is difficult to assess. Critics argue that such a hotel is a Trojan Horse, a marketing device, that could actually lose money but still create a reputation and brand awareness that fuels store openings and new sales. Certainly, Bulgari is not shying away from visible branding. Tying in neatly with the opening, the hotel’s ballroom was used as an afterparty for the Shanghai International Film Festival, an event Bulgari sponsored for the second time in 2018. VIPs from the event stayed at the hotel, and actresses wore Bulgari jewelry on the red carpet. A large logo fountain serves as a roundabout for cars pulling into the hotel and there is, of course, a Bulgari boutique on the ground floor, which is expected to open this month, according to Bulgari. A selection of the latest Bulgari products are also displayed in cases in the lobby, as if guests were still stuck in the duty-free stores at Pudong airport. The hotel also connects to the jewelry brand through its Italian heritage. Its interiors are designed by Milanese firm Antonio Citterio Patricia Viel, which has designed all six Bulgari hotels worldwide. There’s an Italian flavor: Handblown Venetian glass is a feature of Il Ristorante, an Italian restaurant helmed by three-star Michelin chef Niko Romito, and Maseratis, the Italian sports cars, are parked out front for transporting guests to nearby destinations. Typically, high-end hotels targeting foreign travelers take their visual identity from local culture, ensuring travelers feel they have arrived somewhere new. Bulgari instead offers virtual travel to Italy, something that would seem especially appealing to Chinese domestic travelers who need little reminder they’re in Shanghai. Concessions to the Locals There are concessions to guests more interested in a traditional Shanghainese — as opposed to Roman — experience: Guest rooms feature Chinese four-poster bed frames and folding screens, there’s a Chinese restaurant. And the chocolate shop, Il Cioccolato, which displays its wares in glass jewelry cases, features Xinjiang Red Date and Ginger, which costs 18 (120RMB) per piece. Billiard was the General Manager of the Ritz-Carlton in Tianjin before joining the Bulgari Hotel Shanghai team two and a half years ago. He said the main difference between the two is that “we really focus at Bulgari on personalized experiences....We have this opportunity because we have a smaller key count.” Borrowing from a luxury accessories or fashion brand to jump-start a high-end hotel brand makes sense given the way hotel brands tend to lose their luster over time. But Billiard said that's not the only reason you couldn't call the Bulgari Hotel Shanghai something else, like the Ritz-Carlton Suzhou Creek. “I think you could not change the name of it," Billiard said. "It’s obviously an authentic Italian hotel with features and services and design and amenities and food that are authentically Italian. Maybe some other hotels you could use another name and it wouldn’t matter, but you wouldn’t be able to do it in our hotel — it’s too linked to the brand DNA.” There are limits to what Bulgari will do for their jewelry customers, though, with no deals on hotel rooms. “Customers for the jewelry aren’t looking for a deal in the hotel,” Billiard said. “What they’re looking for is attention...feeling welcome and at home.”

Suave Bulgari’s Hotel Strategy with Marriott More than Meets the Eye

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Published July 17, 2018

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Suave Bulgari’s Hotel Strategy with Marriott More than Meets the Eye