DRIVING EXCELLENCE: HILTON’S STRATEGY FOR SUCCESS

As President, Asia Pacific, at Hilton, Alan Watts oversees 717 hotels across 12 brands currently deployed in the region and over 845 under development. “At Hilton, we believe it is our responsibility to fill the earth with the light and warmth of hospitality,” he says.

Watts, discussing the meeting of market demands in India and South Asia, notes that the travel and tourism landscape in India is undergoing a significant transformation, with opportunities emerging at an unprecedented rate. He compares this to the infrastructure booms witnessed in the US during the 1950s and China in the 1980s and 1990s, emphasising India’s rapid evolution in tourism infrastructure. “From expressways to airports, from rail systems to interconnected networks, this expansion not only propels the industry forward but fortifies its resilience against cyclical fluctuations,” he observes. However, amidst this surge in development, he adds, lies the imperative to safeguard against the boom-bust cycles that have characterised India’s travel and tourism sector in recent years. 

He emphasises on the need to diversify and expand the hospitality pyramid as a crucial effort in this regard. While acknowledging the presence of large-format hotels from major brands in the country, he stresses on the importance of filling gaps in the mid-market segment to meet the growing domestic demand. “As India progresses towards becoming the third-largest lodging market globally, this transition holds immense promise for brands and innovation alike,” opines Watts.

He asserts Hilton is actively engaged in this transformative journey, rather than merely observing from the side lines. He highlights the efforts in attracting top talent, deploying midscale brands and introducing new brand entries into the market. “We are poised to replicate the success we’ve achieved in China and the Americas. From Hilton Conrad to Waldorf Astoria in Jaipur, our portfolio reflects our commitment to elevating India’s hospitality sector on both the global and Hilton stage,” Watts says. 

Asia-Pacific’s Dynamic Markets 
Over the past decade, a transformative shift has occurred, poised to significantly influence the industry for years to come. “Gone are the days dominated by long-haul inbound travellers. Instead, a new breed of explorer has emerged – the Pan-Asian traveller. Just a decade ago, our markets were predominantly fuelled by long-haul inbound tourism. However, fast forward to today and the majority of our customers are from Asia,” he observes. This seismic shift not only underscores the changing dynamics of global travel but also presents a wealth of opportunities for destinations like India.

India’s outbound travel stands as evidence of this trend, marking the next frontier in travel and tourism. “But it’s not just India. China’s inbound tourism has been the defining narrative of the past decade, while other Asian nations such as Thailand, Indonesia, Malaysia and Vietnam are also witnessing a surge in outbound travel. These emerging markets share a common thread of rising GDP and a thirst for new experiences, making destinations like India increasingly attractive,” he adds. 

In the ever-evolving landscape of the hospitality sector, adapting to the preferences of the Pan-Asian traveller has become imperative for brands. From revamping food and beverage options to tailoring accommodation experiences, brands must evolve to meet the diverse needs of these travellers. This entails embracing cultural nuances and preferences while capitalising on India’s abundant spiritual and religious tourism offerings. “Despite its status as one of the world’s oldest cultures, India remains relatively unexplored for inbound travellers. This presents a unique opportunity for the industry to showcase the country’s diverse attractions and cultural treasures to a global audience,” notes Watts.

Looking ahead, the potential for growth and innovation in the travel industry is staggering. “By embracing the rise of the Pan-Asian traveller and leveraging India’s rich tourism offerings,” he emphasises, “The stage is set for an exciting new chapter in travel and tourism, both within Asia and beyond.”

Projections and Top Performers in Asia-Pacific Region
Amidst the colossal populations of China and India, coupled with the dynamic Southeast Asian nations, the region is experiencing unparalleled growth, drawing the attention of industry giants such as Hilton. “This translates into remarkable year-on-year growth, with a staggering 140 hotels opened and 250 signed last year alone. This surge is driven by a rising middle class and increasing demand for travel experiences, particularly evident in India,” he says. 

In response to the shifting landscape of the Indian market, Hilton is adjusting its strategies. “Traditionally reliant on out-of-home advertising, we are now embracing innovative approaches such as partnerships with influencers like actor Deepika Padukone and enabling bookings via WhatsApp. These initiatives signal Hilton’s commitment to engaging with a younger, tech-savvy demographic and ensuring long-term success in India’s burgeoning tourism market,” Watts shares.

Major Considerations Behind Market Introductions
As a premier hotel management and franchising company, Hilton’s mission remains steadfast: to deliver exceptional returns for owners, unforgettable experiences for guests and rewarding careers for its team members. “Last year, we earned the title of India’s top workplace, underscoring our commitment to cultivating a supportive environment as we expand. Our approach to brand deployment is meticulous and forward-thinking,” he affirms, adding, “As we extend our reach, brands like Hilton Garden Inn strategically engage frequent travellers, enhancing loyalty and market presence and then there’s the renowned Waldorf Astoria brand epitomising luxury and exclusivity, carefully chosen to exemplify excellence and ensure unparalleled guest experiences and owner returns.”

Operational Excellence in the Indian Market
In its unwavering commitment to maximising owner returns, Hilton remains dedicated to fostering enduring relationships built on performance excellence. “We empower owners to expand their portfolios while continually enhancing our global and domestic enterprise engines,” he observes.

As India’s travel market flourishes, Hilton is extending its presence to key airports like Bengaluru, Mumbai and Delhi, leveraging out-of-home advertising. “Simultaneously, we’re bolstering our loyalty programme, offering exclusive experiences such as Taylor Swift concerts through partnerships like the Singapore Sports Hub. With 180 million loyalty members worldwide, our aim is to direct them towards Hilton brands, whether for global travel, leisure stays or unique experiences. By constantly evolving our enterprise proposition, we ensure top-line excellence, paving the way for a best-in-class bottom line,” informs Watts.

Prioritising People Investment and Talent Development 
Hilton’s recognition as the world’s premier workplace underscores its firm belief that investing in people is fundamental to its business model. “Our approach is straightforward: we prioritise training and career opportunities to attract top talent worldwide. As the hospitality industry in India gears up for substantial growth, we stand out for our commitment to developing skilled leaders from within. Many of our current leaders began their careers at Hilton, starting from entry-level positions and advancing through dedication and hard work,” explains Watts.

He emphasises that Hilton maintains a steadfast focus on hospitality, opting not to diversify into other travel sectors. “Why choose Hilton? Because we offer unparalleled training, career advancement, and the opportunity to work globally. In return, we ask our team to uphold our commitment to delivering exceptional customer experiences, driving our market share, and maximising owner returns. This simple yet powerful approach has fuelled Hilton’s growth for over a century and will continue to do so in the future,” he asserts.

Mapping Brand and Development Strategy
“At the regional level, our brand pyramid – Waldorf Astoria, Conrad Hotels and Resorts and Doubletree By Hilton – guides our growth strategy in Asia,” says Watts, outlining Hilton’s approach. He adds, “Despite our global presence with 7,500 hotels, we maintain a risk-averse approach as managers or franchisees rather than owners, emphasising on trust and careful asset management.”

Hilton’s success as the fastest-growing hotel company in Asia Pacific relies heavily on hyper-localisation, explains Watts. “Understanding diverse preferences is key; for instance, offering rice on late-night menus for Asian guests. In India, focussing on social catering, meeting spaces and breakfast is crucial, especially in cities where Hilton properties are popular wedding venues.” He highlights the significance of Hilton’s micro-level focus on localisation in India. “While our overarching strategy spans all brands and markets, our micro-level focus on localisation in India ensures continued success and safety. By investing upfront in understanding and adapting to local needs, we uphold trust and solidify our position in the region,” he observes.

Charting a New Journey with Stakeholders and Partners in India
Being a part of India’s vibrant travel and hospitality sector is a privilege, asserts the President, Asia Pacific at Hilton. “In a market where investors have numerous options, we’re honoured that owners entrust us with their properties and that team members choose to join Hilton. This gratitude extends to the industry’s maturity and collaborative spirit. India’s expansive market accommodates diverse players, and we envision continued growth for all. Recognising the contributions of team members and owners is paramount, as is fostering loyalty among customers,” he says.

At Hilton, hospitality is the core ethos, prioritising relationships with owners, customers and teams above all else. “This approach ensures our resilience and success in India’s evolving landscape,” he says proudly. 

In January this year, Zubin Saxena assumed the role of Senior Vice President and Country Head of Hilton in India, taking charge of Hilton’s 25 operating hotels in the country and leading the company’s expansion in South Asia, with 20 properties in the development pipeline. “For me, the mandate is clear — to bring world-class hospitality that Hilton represents into this sunshine market called India. So, we envision, over the next several years, to have a hotel in more than 75 locations in this country and that presence has to be underscored by superlative service, superlative owner ROI and huge participation in the India sunrise story. We are here to deliver,” says Saxena, outlining his vision for Hilton’s growth in India.

Navigating Growth Opportunities in 2024 & Beyond
Saxena says the starting point of the journey on the way ahead has to start from being able to deliver an incremental ROI for their owners and that has to be in from the beginning for operational excellence. “We would want to grow India being a market which grows with relationships, that grows with owners. We would want to ultimately grow with our existing owner-partners and of course have tie-ups with many more as we go ahead. The fundamentals have to be right and we would begin with focussing on the fundamentals of the business which start with operational excellence, with start with increasing distribution footprint in India and which start with focussing on creating market visibility,” he says.

He draws attention towards around 75 organised hotel markets in India. “Of course, beyond Tier I and Tier II markets, those markets keep on growing. In the long term, these 75 are going to become 150. If we see where we are in this point in time, that long journey has to be articulated in an extremely smart and strategic manner. We will begin by placing the right assets in the right partnerships in the right markets,” feels Saxena. However, the Hilton India head feels it is all dependent on partners, sites and market selection. “It needs to be a very scientific and pointed process. On the back of being able to deliver owner ROIs, we should be able to grow more. In Tier I markets, we see the top 10 markets, our luxury and upper upscale brands, the Waldorfs, Conrads, Hiltons and Double Trees by Hilton. Then in Tier II and Tier III markets, in the long term, India is a mid-market growth story. So, focussed service brands – Hilton Inn and Hilton Garden Inn are going to be key to our growth in India. Secondly, we have to be very open-minded about how are we going to structure this growth in terms of commercial tie-ups,” he opines. 

The preference at Hilton is to grow via the management route and management contracts in the upper upscale and full service segments and luxury segments. “We would be open to evaluating various selective franchising in our focussed service business. That’s how broadly the way to the future looks. For us, it is not just about having a hotel in every location in India, it has to be a hotel with the right quality. Growth will be determined by owner ROI, guest satisfaction, customer experience and being the best place to work,” Saxena shares.

The big and bold Hilton story 
At present, Hilton boasts of a portfolio of 26 hotels and is poised for 100 per cent growth in the next three to five years. “We are looking to build up organic and strategic growth functions around a very high-quality portfolio and looking to sign an above-par number of hotels every year. Eventually, the above-par signings will convert into above-par openings and that’s the mandate. Ultimately, I see a Hilton hotel in a hundred plus markets in India,” says Saxena, emphasising the ambitious expansion plans.

At Hilton, he shares, they perceive a unique opportunity to introduce world-class brands into the fastest-growing market called India. “We have the white space to curate that portfolio. There’s been a lot of talk about expansion, growth and numbers. Going ahead, we have the unique opportunity to be able to achieve those numbers with a high-quality portfolio. We are highly optimistic and confident about what lies ahead,” Saxena opines, expressing his confidence in the future prospects.

Saxena draws attention towards the strong resurgence in RevPARs globally, post-pandemic. “RevPAR levels have increased by high double digits in India. ADRs too have gone up almost 50 per cent, post-pandemic. Hilton’s performance in India has been above par and a lot of it depends on the distribution spread of the portfolio. As we move ahead for this year and beyond, it’s going to be a strong year for Hilton and the industry. With our commercial engines revving up, our RevPAR growth is going to be very, very strong,” shares a confident Saxena.

Strategies for Operational Excellence
The Hilton head in India feels building engagement and deep trust is the first step towards operational excellence. “For a long-lasting partnership, trust is extremely important. We have several partners and hotel owners with whom we have multiple assets. Again, I’ll go back to my earlier point of delivering owner ROI – it can only come through operational excellence; that’s where it starts from,” he says.  

Over and above is relationship. “It is important to be seen as a long-term partner. In India and in many other parts of the world, you can’t be seen as a transactional hotel brand or a hotel partner; it has to be long run. Today, our management agreements last 15-20 years on average. Owner engagement and owner value proposition are at the heart of how we are approaching it,” feels Saxena. 

Talent, The Crucial Determinant of Success
Sharing his views on one of the most challenging issues the hospitality industry is facing, Saxena says Hilton will continue to grow its teams with world-class professionals. “Beyond having world-class talent join us, we aim to promote from within the organisation. Our target is to have 70 per cent of vacant positions being filled in from within Hilton. So, there’s a big focus around talent, around growth and around growing the best talent,” he says.

Stakeholders and the Journey Ahead
Saxena radiates optimism about the future as he addresses his stakeholders, expressing his belief in India’s long sunrise ahead. “Our aim is to construct enduringly resilient businesses founded on ethical principles, values and strong fundamentals.” Not only does Hilton’s India head aspire to generate exceptional returns and ROIs for owner-partners, but also for guests and employees alike. With this vision in mind, he prompts stakeholders to anticipate the promising developments ahead.