LEADING MAN LEADING MAN

Inspiring and Educating Sellers of Affluent Travel MAY 2005
LEADING
MAN
Paul McManus of
The Leading Hotels of
the World on Being
a Luxury Lifestyle
Consultant

COVER STORY
Leading Man
Paul McManus of The Leading Hotels of the
World on Being a Luxury Lifestyle Consultant
BY RUTHANNE TERRERO
You’ll find them in 80 countries
across the globe. The traditional
Grande Dame hotels that virtually
define luxury by their
majestic presence in city centers
and renowned attention to service.
Then there are the opulent, aspiring fivestar
properties assessing whether they must
carry a hotel brand or remain independent.
There are also clusters of hotels, smaller chains
aiming to become a formidable force in the luxury
hotel market that need the umbrella of an
established hotel company in order to grow.
These are The Leading Hotels of the World
(www.lhw.com), a portfolio of 420 hotels
whose “Leading” imprimatur demands from
them a commitment to quality service and, in
return, provides them with a high level of sales
and marketing and reservations services.
There’s no question that Leading has a
sizeable impact on the lives of travel agents,
who contribute to 85% of the bookings generated
by the company. When a travel agent
books a Leading hotel, they have a virtual
“guarantee” that the property, though independently
operated, will provide their clients
Leading the Way: Pictured above, left to right,
are Kenan Simmons, vice president of sales;
Welf Ebeling, executive vice president and COO;
Paul McManus, president and CEO; and Kimberly
Moffitt-Hehir, vice president, strategic planning.
with a defined luxury level of service and
accommodations.
What exactly is the Leading guarantee?
“Each Leading hotel is run according to the
Leading standards of luxury,” says Paul
McManus, Leading’s president and CEO, who

has headed the company since
1998. “And while each hotel in our
group is different in terms of architecture
and style, they subscribe to
the same style of operations. All are
inspected on the same basis.
Allowance is given for the nuances
of each property, but they all provide
a service that is consistent and
that is the key,” says McManus.
Another “Leading” trait is that each reflects its destination, says
McManus. “Leading is for the person who appreciates luxury but doesn’t
want a cookie-cutter approach to hospitality.”
Every Leading property is inspected twice in a three-year period.
“If there is something wrong we accelerate that process and if we get a
complaint we investigate it that day,” says McManus, who personally
writes a letter to the hotel in question. Service issues must be corrected
immediately, he says. While matters relating to the physical nature of the
hotel are given more time to correct, Leading expects to receive a business
plan on how the problem will be rectified.
But Leading’s commitment to luxury delivery goes well beyond
inspecting its own hotels. One of its many joint venture companies is
Leading Quality Assurance, which carries out inspections for 600 other
hotels worldwide, as well as Silversea Cruises. As a result, the company
provides luxury benchmarking to more entities in the industry than most
realize. McManus says Leading hopes in the next few months to add an
airline to its portfolio as well as other providers of luxury service.
While Leading’s eyes are on its hotel portfolio and other services it can
provide to the industry, it’s also keeping a keen eye on one of its most
valuable assets, its database of loyal customers. The company has long
offered The Leaders Club, which provides benefits to frequent guests, but
starting this month, an entirely new rewards program launches, with
some unheard-of benefits for its most loyal customers.
Luxury travel advisors take note: Leading’s message is that agents will
be fully involved in the new program. In fact, agents who use the program
to its full advantage will end up servicing their clients as never before.
“You will find that we allow travel agents access to everything at Leading
Hotels, even the Internet,” says Kenan Simmons, Leading’s vice president
of sales, who points out that if an agent’s client books a trip on
www.lhw.com on their own, the agent is still able to earn a commission
because Leading has an area on the client’s profile that provides the agent’s
IATA number. And with this relaunch of the Leaders Club, members are
being asked to provide the name and contact information for their travel
agent so they may send the agent the client’s Leaders Club information
simultaneously.
“Even though [the new Leaders Club] is a customer loyalty program,
the travel agent community is still going to have access to it. We are also
building a separate Web page for travel agents in order to update them
on the program and to opt in to receive all collateral,” says Simmons.
Another part of the program’s launch is a proprietary, passwordenabled
Website that allows Leaders Club members, and their travel
agents, to update travel preferences
on a regular basis. There will also be
an area on the profile where the
agent’s name is listed. Hand in
hand with this custom profiling is a
new customer relationship management
(CRM) program that allows
Leading to record guest preferences.
The move means that Leaders Club
members who have visited one
Marshall Calder says the Leaders Leading hotel will be treated as
Club relaunch aims to generate repeat guests when they stay at
loyalty to the Leading Hotels brand.
another Leading hotel, even if it’s
the first time they’ve visited.
“Our goal is to learn about the customer and turn that information
into intelligence so we can help serve them better,” says Marshall Calder,
Leading’s senior vice president of marketing.
The second phase of the Website will entail Leading’s ability to “push”
information to members.
“If they like spas, skiing, or gastronomy, we can push that information
to them,” says Calder.
The three levels of the new Leaders Club increase in the level of benefits
the member receives.
“We did a lot of consumer research and what we discovered is that our
customers want exclusivity, access, privilege and recognition. What they
did not want is points, because they felt that was contrary to what they
expect from a luxury hotel,” Calder told Luxury Travel Advisor.
The new Leaders Club program, which launches in June, has three
distinct levels of benefits; existing members will be invited to join each
level depending on their experience with Leading, and they will have to
reaffirm their interest in retaining their membership.
Level one—still dubbed Leaders Club—provides much of what current
Leaders Club members receive, with a few new extras. Clients receive
a room upgrade, if available, on arrival at a Leading hotel, as well as late
check-out and early check-in, if available. They also receive a gift from the
hotel’s general manager. Level-one members also have access to special
Leaders Club reservation centers.
The second level, called Leaders Club Access, includes all of the above,
however, the room upgrade is confirmed when the hotel reservation is
made.
“This avoids check-in angst,” says Calder. “This is a big part of the
program, because nine out of 10 of our members rated the room upgrade
as ‘highly desirable.’ Plus, an upgrade at a Leading hotel is a big leap—it
can be a $150 to $200 a night difference,” he notes.
Leaders Club Access members also receive benefits from Leading’s
marketing partners, such as upgrades at Relais & Châteaux hotels and
shipboard credits on Crystal Cruises. But perhaps the most outstanding
benefit of being a Leaders Club Access member is the use of a concierge
service to assist with travel planning in relation to an active reservation at
a Leading hotel. This means a Leading member could use the concierge
for finding a petsitter before departing on the trip or making nightclub

eservations at their destination. The service is
included with the annual $300 fee for being a
Leaders Club Access member.
Leaders Club Unlimited is the top tier of
the program. The primary benefit of this level
is the use of a dedicated, personal concierge
available to members 24/7, 365 days a year,
for any lifestyle need they have, not necessarily
in connection to a Leading hotel reservation.
This means, for example, someone who lives
in New York City could use the service to get
a reservation at a hot local restaurant, such as
Per Se.
The service is included with the $2,000
annual fee for being a member of Leaders Club
Unlimited.
“Our interest is to try to be more of a
lifestyle companion for our best customers, to
be able to aid their lifestyles. We want them to
engage with Leading hotels on a daily basis,”
says Calder.
How does one obtain status as a Leaders
Club Unlimited member?
“It’s double secret probation,” laughs
Calder. “The criteria for the top level is going
to be fuzzy. It’s not based on just frequency.
This is for our best customers, for our brand
evangelists, for someone whose choice of Leading
Hotels is really discretionary,” he notes.
“Sometimes a corporate traveler chooses a
Leading hotel but it’s not always discretionary.
We are looking at someone who books four
times a year and on each trip will spend
$20,000 to $30,000.”
Since Leading’s policy is to allow travel
agents access to all of their programs, it is feasible
that travel agents who have clients in the
Leaders Club Unlimited level could manage
their requests by simply using Leading’s
concierge program.
In fact, managing Leading’s services on
behalf of the client is how agents are presently
able to function with the current loyalty
program.
“That is how it is done for the present
Leaders Club," says Simmons. “Our intent is
never to disintermediate the travel agent but to
give them more product to sell. We want to
engage them in the process.”
“The more the luxury agents
can identify themselves as
lifestyle consultants, their
success will be even greater.”
— Paul McManus
Indeed, Leading’s CEO McManus emphasizes
that travel advisors should be playing the
role of concierge for their clients.
“The more the luxury agents can identify
themselves as lifestyle consultants, their success
will be even greater,” he says. “People are
time-deprived but we are finding lately that
even with shorter times, people go longer distances.
They do this because of product
knowledge and in some cases, word of mouth.
But the luxury travel advisor is also greatly
responsible for that; it is an absolute must in
today’s business to know where to go and to
know what to do. If you look at Bill Fischer,
Valerie Wilson and Priscilla Alexander, these
are the people who really know how to get the
business done. You really have to own your
customer today.”
To cultivate its top-tier travel agent business,
Leading works especially closely with a
core group of agents. This group has access to
an exclusive toll-free reservations number and
enjoys a higher level of service than other
agents.
© Reprinted from LUXURY TRAVEL ADVISOR, MAY 2005 Printed in U.S.A
“We’ll make sure these agents’ clients are
well looked after,” says Simmons. “We’ll provide
them with breaking space during sold-out
dates, and arrange for transfers to and from the
hotel. These are the agents who deliver the
most business or have the most potential
business. It’s not so much based on volume but
on the quality of the business that is being
delivered. For example, in some cases we’ll have
a particular agency that may not give us as
much as the larger houses but when you look
at their average rate
it’s about $250 to $300 higher, so they would
have access to that dedicated agent service.”
Leading also has a sales force on the ground
that calls on the travel agency community
internationally; it also hosts a series of educational
showcases and road shows worldwide.
Next, watch for Leading to continue to
expand its businesses. It already has launched
The Leading Spas of the World, through
which it benchmarks standards at the spas
within its hotel portfolio. It also plans to
expand its number of international offices by
opening in Dubai, Mumbai and Shanghai.
And, it will launch a program that allows consumers
to purchase goods from its member
hotels over the Internet, as well as products
with the Leading logo.
But while there are still other major initiatives
for the company on the horizon, Leading’s
main focus will remain on keeping up the
standards of its luxury hotels.
“Customer expectations rise, they don’t go
down,” says Calder. “The challenge of a true
luxury hotel is to meet those expectations every
time. The traveling public is comprised of
smart travelers. They really do know what they
want, and who delivers.” �
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