Star struck

Hotel classification systems are a frequent bugbear for both owners and operators. Louise Oakley asked the experts to make sense of current systems — and to suggest a solution to the current confusion

The hotel business may be a global industry, but hotel classification systems are certainly not.

Some are set by governments, others by tourism bodies; some are based on a points system and others are more of a check list; while some are broad in spectrum and others, such as the ratings system in France, have only recently expanded to include a five-star category. And the differences are not just regional but also intra-regional – hotels within the same brand could well be ranked differently depending on their specific location within the GCC.

Hoteliers have long lamented the restrictions caused by star ratings and the confusion that the classification systems can cause for owner, operator and consumer, but they still exist and there seems little likelihood of them being abolished. We are not here to rewrite the rule book, therefore, but to urge revision and evolution in light of today’s market.

Leading hoteliers in the region have decided now is the time to question the systems that affect professionals at every stage of hotel development — not to mention the most important person, the guest. Later this month at The Hotel Show, a panel of experts led by Hilton Worldwide president Middle East and Africa Jean-Paul Herzog is set to question and challenge the existing classification systems.

Herzog said: “It is important because it is something that a lot of authorities or bodies are engaged in, it is something that touches every single hotel, and I think that it does need to be looked at and questioned and hopefully brought into some proper direction”.

He was not critical of the systems per se, but of the differences between each one and the confusion this caused the consumer.

“There are many [systems] that are up to date and easy to understand but they’re only understandable for the people in that country and since they’re meant to provide an international language, a lingua franca, for the hotel business, they certainly don’t do that.

“These things should not have been invented for hoteliers, they should have been invented for consumers and I’m sure that was the father of the thought — how can I easily describe my hotel to a consumer?”

Brand power

The descriptions of hotels have evolved over the past few years as the industry has matured and diversified; no longer can consumers rely on the distinctions set by star ratings. Rarely will a five-star hotel shout about its star rating, instead defining itself by upper-upscale, luxury or deluxe. The same is true for three-star brands, which prefer terminology such as midscale, budget or limited service. Is it time for everyone to agree on these terms, universally label hotels by them and communicate their brands in this way?

Herzog responded: “You’ve hit the nail on the head. Stars don’t seem to do it for everybody or every brand and I think in many respects brands are more powerful, more consistent and certainly more international than stars under the current system can ever be”.

TRI Hospitality Consultants associate director John Podaras, a fellow panelist at The Hotel Show session, agreed that “in a competitive environment, brands will lead the way”.

But while this might be a way to overcome star-rating confusions across borders, it does not explain why hotels in markets such as Dubai are avoiding using star ratings in their positioning.

Layia Hospitality CEO Daniel Hajjar, the third panelist at The Hotel Show, said that this could often be the case with brands likely to be classified three-star because of a “phobia” of being associated with older properties that would fall under the same classification but were far from meeting the same standards.

“In the two-star and three-star market this is very crucial, because we have this problem here, we have this problem in Bahrain, in some cases in Lebanon,” said Hajjar. “All these brands that are coming in that are all about budget — basically if you don’t want the frills you don’t have to pay for it, however, the basics are all going to be excellent. We want to make sure that you [the customer] know I am not like the one next door where the room category is poor.”
Premier Inn Hotels LLC managing director Darroch Crawford agreed this was an issue.

“We are a three-star hotel. I actually don’t like star ratings. I think that star ratings are a real problem for the limited service industry as a whole because a three-star in Dubai conjures up an image of an unbranded, not very reliable hotel in Deira or Bur Dubai perhaps, and that’s not what we’re about at all,” said Crawford.

For John Bamsey, chief operating officer Middle East and Africa, InterContinental Hotels Group ­­– which operates the Holiday Inn Express brand, which is classified as a two-star property at Dubai Airport for example ­– the avoidance of star ratings in descriptions goes back to the customer.

“We classify rooms on a scale rather than through star ratings. We’re a midscale hotel, limited service, midscale sector. When you’re in the industry, there’s a lot of talk of two-star, three-star, four-star but the customer never talks in that language and they don’t understand it,” said Bamsey.

But do they realise limited service, budget and midscale could mean the same thing? Hajjar thinks so, thanks to the success of low cost airlines.

“The airlines are always ahead of the hotels and the marketing they have done has helped the hotels join the bandwagon in an easier way,” said Hajjar.

Podaras said that there was more confusion at the other end of the spectrum, however, where there are more quantifiable factors that need to be defined.

His suggestion was for a classification system where the star ratings were used as a minimum requirement for standards.

“A regulatory body shouldn’t be too prescriptive, so it should, therefore, come up with a set of standards that are essentially the minimum that you will allow. And they should have sensible differentiation. So have five categories, they should have enough scope within them, and then once you hit the top of each one, that’s the minimum — if you want to go above that as an operator or an owner, by that stage you’ll be using a brand or a name and it’s up to your own marketing to educate the consumer that you’re much better than the standard five-star,” said Podaras.

What’s the solution?

The panelists agreed that more flexible systems were needed, and Hajjar emphasised the importance of putting something in place that was “practical, efficient and straightforward”. He demanded criteria with clear reasoning, that he could then debate and discuss with the relevant authority should it be necessary.

“I think it is probably the right time to clean the market and to try to come up with criteria that are easy for the owners to develop, clear for the operators to manage and clear for the customer to know what he or she is going to get,” said Hajjar.

Podaras said a one-size-fits-all system would not solve current problems, and said classifications needed to distinguish between types of hotel, whether business or leisure. Bathtubs might be required for a five-star resort for example, whereas showers might be more appropriate for a five-star city centre hotel.

“You need to have enough flexibility in the system to reflect the purpose for the property,” said Podaras.

He added that classifications should also recognise both hotel hardware, the facilities, and software, the quality of service.

Some countries are leading the way. The system introduced last year by Abu Dhabi Tourism Authority has been well received, referred to by Podaras as “one of the best” systems he has seen. But as ADTA chairman Sheikh Sultan Bin Tahnoon Al Nahyan revealed in our interview on page 31, this had been under development since the authority’s inception in 2004, reflecting the sheer investment of time and resources that is necessary to get a system right.

Dubai Tourism and Commerce Marketing too is taking its time to perfect new criteria, currently in draft version, of a system that is in desperate need of being updated (see page 50). Meanwhile, Tunisia and Jordan have both recently announced new classifications. The Tunisian Federation of Hotels has so far classified 300 hotels (55% of its inventory) under a new system that emphasises safety issues, non-smoking areas, food hygiene and accessibility for disabled guests in addition to equipment and facilities. In Jordan, where the classifications are set by the Ministry of Tourism and Antiquities, the focus has moved away from the structural element of the hotel to being on the customer.

The Minister of Tourism and Antiquities HE Maha Khatib told Hotelier: “Therefore an item or an area would not be considered a standard for classification if it is not seen as beneficial for the guest.

“It is not the input in terms of investment or effort, but the output in terms of guest satisfaction that is the deciding factor in the choice of standards and the relevancy attributed to them,” explained Khatib.

“In this regard, the only physical element determined by the new system is the size of the rooms. The previous system considered many others, such as the size of hallways, swimming pools and the kitchen.

“The new system, for example, is not concerned about the size of the kitchen but instead looks at whether the food service is good and delivered in a timely manner, ad the food is of high quality,” she continued.

“The back end structure of the hotel is not taken into consideration, as long as the expected standard of service is provided,” she said.

The emphasis on the end-user was a favoured option among the professionals Hotelier spoke with, but there was no agreement on how this should be achieved.

“I don’t know if we will ever get it right 100% but I think it has to continue to evolve with time and we have to make sure that there are practical reasons behind the rating. It shouldn’t be subjective. There should be a reason behind every point,” said Hajjar.

And finally, there are two end-users to consider, as Ròya International CEO Ahmed Ramdan pointed out.

“The consumer may not understand all the terminology, but the agents, the bookers, care very much. They categorise it and care about the star rating. They always tag the price based on rating,” said Ramdan

In conclusion, there was a reluctant acceptance that no system will ever be perfect, but that all systems need to be regularly reviewed.

Herzog said: “I think every rating system has things you can be against or not agree with, there’s always a few cliffs you have to steer around, what’s more important is they conflict from one country to the other and therefore also conflict with what I am trying to promise as a brand”.

One day then, will hotel brands be so strong that they will overtake the need for star ratings? Herzog would not be drawn on this, saying he couldn’t comment on “whether it’s going to continue or not”.

For the foreseeable future, star ratings will be here to stay, so it is how often they are updated and how they are communicated to the end-user that is important.

DUBAI CLASSIFICATIONS UPDATE

The new hotel classification system in Dubai, established by Dubai Tourism and Commerce Marketing (DTCM) has been in draft format for two years now. As a result of the rapid growth of the industry the new system is needed to meet this and there are certain anomalies the experts would like addressed. Layia Hospitality CEO Daniel Hajjar, for example, questioned the need for a five-star hotel to have a ballroom. In the four-star category, he said under the current system it was necessary to have two restaurants that served breakfast as well as a barber shop – what was the rationale behind this? TRI’s John Podaras, meanwhile, suggested that a hotel shouldn’t be penalised for not having a certain quota of bathtubs, for example, as long as it made up for this in other ways.

DTCM director of hotel classifications Majid Al Marri said a new system for Dubai was to be released by the end of the year, hopefully in October, and that DTCM was in the process of updating the IT system to enable the inspection reports.

He said it would be a “world-first”, and hinted that it would include categories for types of hotels, such as “mountain hotel”, “desert hotel”, etc.

Al Marri said that the new classifications could be expected to follow a points system, similar to the one that has been adopted in Abu Dhabi.

He also said that the classification for hotel apartments would be expanded, with a Basic category to be added to the current Standard and Deluxe options.

Al Marri wanted to reassure hoteliers that they would be given time to implement the new criteria once it had been announced.

“We will look into issues and see if there is a way of helping them,” he said.

KEY ISSUES

• Systems must recognise both hotel hardware (facilities) and the software (staff and service).
• Hotel classification systems differ greatly worldwide; each one is only understandable in the country in which it was established.
• Current systems cause confusion for owners, operators, developers and guests alike.
• Classifications should take into account the type of hotel, whether business or leisure.
• Confusion at the two- and three-star level because new properties are offering far better facilities and services than existing, often unbranded properties.
• Operators demand more flexibility within systems.
• Major hotel brands are more consistent worldwide than star ratings.
• Star ratings are here to stay; even if guests have grown accustomed to new terminology, bookers still rely on star rating categories.

Jean-Paul Herzog, Daniel Hajjar and John Podaras will be speaking on ‘the sense or non sense of star ratings’ at The Hotel Show Seven Star Conference, 3pm-5pm on May 18.