The collection of independents developed by Pebblebrook and management companies focuses most on operating efficiencies
versus bookings, and has it sights set on scale to deliver even more ROI.
BETHESDA, Maryland – A soft brand without a booking engine? Yes.
But the fees are comparatively minimal and case studies show saving on
operating costs as much as 10x the amount of fees charged. That is Curator
Hotels & Resorts Collection’s story and differentiator in an increasingly
crowded field courting independent full-service hotels.
The brand developed and owned by Pebblebrook Hotel Trust
supports some 101 members today with operating agreements, services, and
technology. Jennifer Parks, vice president of Member Development and
Communications, said some 120 preferred vendor agreements have
delivered Curator members millions of dollars of annual expense
savings.
Among the founding members are Pebblebrook’s 30-some
full-service, independent hotels, as well as independents from Davidson
Hospitality Group, Noble House Hotels & Resorts, Sage Hospitality Group,
Springboard Hospitality, and Viceroy Hotels & Resorts.
Now Curator is adding a focus on social media marketing to
help drive referrals bookings to member websites – remember, Curator has no plans to
create a booking engine.
Jenn Parks, Curator Hotels & Resorts Collection
Parks said Curator is developing a very substantial digital
marketing campaign focused on experiences for which it is the sole investor. It’s
not a cooperative program and it focuses on driving traffic to the Curator
website and then turning them into commission-free referrals that go to the
hotel members’ websites. It has also relaunched all social media channels and includes
influencer campaigns, sweepstakes, and the like.
Curator is also working on a member cross-promotion program
via email campaigns. Curator creates the promotional template and members use
their databases to cross promote about five times a year. Curator estimates the
emails reach about 1.3 million consumers per campaign.
Flexible model
The draw has been the fee structure and the model’s
flexibility with members given a 60-day free trial and the ability to leave at
any time with 60 days’ notice.
Scale is the goal for Curator to drive better pricing power
because the endeavor is ROI focused. It hopes to grow membership to above 200
by the end of next year.
On average, Parks said year-over-year membership retention hovers
around 90%. She said reasons that members may exit the collection include ownership and
management changes as well as the decision to affiliate with a brand for
specific reasons typically related to the market the property is in.
Parks wouldn’t offer how much Pebblebrook is investing in
Curator only to say it is “substantial” and that they are still working on
making the venture profitable. “Pebblebrook fully believes in this endeavor and
really wants to help independent hotels,” she added.
What she did offer were case studies to show proof of
concept. The expected or average savings versus fees paid is 2x to 4x,
according to Parks. She said owners who engage with Curator in more of a
consulting role while still in the development stage can drive the most ROI.
Among those is the 109-room Albert Hotel in Fredericksburg, Texas, which opens
in January.
We can help lessen the load of the hotel teams because we’re out there running all the RFPs, we’re piloting all these programs, we’re vetting everything, negotiating all the pricing. All of these things are huge resource drains for the hotel teams.
Jenn Parks
“We can help them set up their tech stack so they’re getting
Curator pricing from day one,” Parks explained. “We are very flexible in terms
of how we structure our contract with them, where we just charge a minimal
consulting fee, and then they start to pay membership fees after they have
overnight guests.”
Among existing members, a resort property with between 51
and 100 keys that joined Curator in January 2021 has recognized estimated
annual savings of almost $79,000 (almost $30,000 from a F&B POS) as well as
close to $30,000 estimated annualized revenue through Curator digital marketing
revenue. In summary, the property realized combined estimated annualized value of
more than $105,000. It paid $40,000 in Curator Fees for a return of 2.6x and an
asset value enhancement at 6.7% cap rate of $1 million.
An urban property with between 200 and 250 keys that joined
in November 2020 realized more than $82,000 in an annual savings (including almost
$32,000 from a CRS and RMS system) and more than $53,000 in annual revenue (more
than $52,000 via a boutique hotel collection revenue). The combined annualized
estimated value of more than $135,000 with almost $6,000 in Curator fees led to
return of 22.8x, a net annual P&L impact of almost $130,000 and an asset
value enhancement at 6.7% cap rate of $1.9 million.
Engagement challenge
The biggest challenge Parks said Curator faces is member
focus. “Whoever we talk to has to socialize Curator within the organization and
that has been really difficult,” she said. “We can help lessen the load of the
hotel teams because we’re out there running all the RFPs, we’re piloting all
these programs, we’re vetting everything, negotiating all the pricing. All of
these things are huge resource drains for the hotel teams.”
The other challenge Parks has been seeing more recently has
been with what she calls the all-in-one tech solutions. “We don’t take any
sponsorship dollars or kickbacks from tech vendors. They don’t pay to be part
of our network of preferred providers, which is very different than other
collections… We typically don’t partner or align with some of these newer,
all-in-one companies because when we dig into the details there are hidden fees
because they don’t have all of the integrations that you need. You have to pay
extra for all of that... We feel like they’re overcharging independents in a
huge way.”
The end game, according to Parks: “We’re helping independent
stay independent, which is really needed right now.”