How does the Renaissance
Hotel position itself to capture the business market
in Russia's competitive hotel industry?
The Renaissance is the oldest international hotel
in town, established in April 1991, as the first
International Hotel in Russia; it is a join-venture
between Marriott International and the government
of Moscow. There are 3 more Marriott hotels in the
city.
We have 475 rooms, one of the biggest internationals
hotels of the country, and we also have a very big
space for business affairs, with clients coming
to hotel for already 11 years (they are very loyal).
During the last 4-5 years there has been much more
competition, and we decided a year and a half ago
to renovate the entire hotel - and we have renovated
all the rooms, most of the restaurant, the lobby,
and we are now renovating the meting rooms as well.
This is coupled with a very aggressive pricing policy
and has secured our standing in the international
hotel market.
The biggest hotel in Moscow is definitely the Marriott
Grand. They sell more rooms than any body else in
town, and then the Renaissance hotel is second in
line in terms of number of rooms sold.
Our market is based in a 4-to-5-star hotel, just
below the 5 star market - we provide the client
with excellent service and facilities, at an excellent
price as well. Prices usually vary between 165-185
USD for a regular room.
What is your largest revenue generator - does
it come from business delegations, the conference
market, or other areas?
The biggest revenue comes from international business
travelers on an individual basis. Our main market
is the US, followed by UK and Germany, although
we also have a growing number of Russian clients
that represent between 17 to 18 % of our occupancy.
Moscow is a very competitive industry, and some
hotels we have interviewed are pointing to the Marriott
and suggesting that it is lowering prices and compromising
quality... Some say that this price war is a race
to the bottom. How do you respond to that?
A lot of the competition feels that they have priced
themselves below where they should be, if you take
into account their premium location, the products
of the rooms and the restaurants they have to offer.
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Yet we are always in
the same position; we maintain the standing of an
international 4 stars plus hotel. We do not want
to compete and have 5 stars; our location will not
allow us to receive a 5 star status, and there are
some hotels in the center we cannot compete with.
We have always tried to keep our share of the market,
and we have succeeded.
The big difference between the Renaissance hotel
and the others is that during the summer we are
very busy. By working with tour operators we have
obtained many more contracts than the others hotels
located in the center.
The regions in Russia are underdeveloped and
unknown. What are some major business opportunities
to develop there?
We are building a hotel in Samara, which will probably
open in mid-August with a very nice hotel and a
capacity of 228 rooms. Samara is an industrial area,
with great potential, and we always examine airport
links and international access which will mean that
people will be traveling around these areas. We
are also building one in St Petersburg, and one
more in Moscow. In some of the regions we are not
looking for 5 stars hotels, we are more looking
for 3 star plus.
What your biggest challenge, especially regarding
the issue of the training in Russia?
It is a big challenge; we need to constantly make
major training efforts, and we keep on training
people, even the general manager, with 40 hours
of training a year for every associate and the support
of our human resource trainers to come from abroad.
My biggest challenge was when I came here - the
hotel was in very poor conditions, with a great
need for renovations. Following the devaluation
of the Ruble in August 1998, more than half of
the business disappeared, but we had to manage
everything and keep the renovations going.
What is your final message to our readers, keeping
in mind that there are many investors and business
people traveling around the world, and may read
our report from Russia?
My final message, in general, is to seriously look
into the Russian market. There is a lot of money
to make here. Of course it is important to be very
careful when you choose a local partner, but at
the end of the day, many foreign companies in Russia
have made a great deal of profits here. |
Finn Rasmussen