“We are simply doing what the industry is probably thinking as, ‘What else is new?’” Thorsten Kirschke, chief operating officer of Carlson Hotels, is discussing Carlson Hotels’ and Rezidor’s announcement that it will form The Carlson Rezidor Hotels Group, just hours before the news is set to hit the public. (See yesterday’s announcement.) “We are doing what is that natural next step,” Kirschke told Lodging.
The Carlson Rezidor Hotel Group is the product of the long-time relationship between the two companies. Kirschke, in fact, spent 15 years at Rezidor before coming to Carlson from his native Germany. Carlson has also been embarking on it Ambition 2015 plan, which, among other plans, has seen Rezidor’s Radisson Blu brand come to the United States.
Kirschke is quick to point out that the move is in no way a merger of the companies. There is no equity swap. The legal status and ownership structure of Carlson and Rezidor remain the same, but the Carlson Rezidor Hotel Group will pursue the global alignment and management of its brands, the development of its revenue generation engines, global purchasing opportunities, and people development, on a global basis. Commercial activities will be conducted under the Carlson Rezidor Hotel Group name, irrespective of geographies.
“What we’ve done is formed a steering committee—a governing body, if you will—co-chaired by the two companies,” Kirschke said. There is no minority representation. We are simply leveraging the synergies and the power of speaking to the market as one voice.”
The committee will be co-chaired by Carlson Hotels CEO Hubert Joly and Rezidor CEO Kurt Ritter.
The new name is not intended to affect any of the companies’ brands. “The new name is a business-to-business label. The product brand names don’t change at all,” Kirschke said.
But, he expects that current and future franchisees of those brands will see significant benefits of the move, particularly from the revenue-generation front.
In the announcement yesterday, the companies said “through a number of concrete revenue generation initiatives, the Carlson Rezidor Hotel Group aims to generate more than $400 million in additional revenue and a RevPAR Index increase of more than 9 points by 2015.”
Kirschke also said that the company has a very precise plan for reaching the $400 million revenue generation mark by 2015. “We have focused on five areas: Web-based bookings, our loyalty program, revenue optimization tools, global sales and or strong relationship with travel management companies.”
Kirschke sees the new global sales forces as a key to success. “We will see a better aligning of our global sales forces, especially in emerging markets,” he said. “More precisely, in the area of development and ownership, the business of hospitality is being done globally now. We see a new breed of investors out of emerging markets and this will be a benefit in that regard.”
Since its announcement, Ambition 2015 has been making progress, according to Kirschke. “I’m just thrilled with the progress,” he said.
Kirschke said that the company informed key partners the day before the announcement. “We have, of course, in true Carlson fashion, had personal communication with our partners and franchisees,” he said. “They all applaud it. They all believe it is the natural next step.”
The change of name is effective immediately and the company’s new website will debut on Feb. 1.