Sebastien Mariette is the General Manager of the Royal Maxim Palace Kempinski Cairo and the Area General Manager for Kempinski Egypt. He sat down with MET&T in Cairo to talk about how the company pivots its target customer focus to the local market during periods of lower inbound tourism and the unique aspects of each of Kempinski’s luxury hotel properties in Egypt.
Interview by John Nicholson, Editor-in-Chief, Middle East Travel and Tourism (MET&T)
MET&T: I wanted to start by asking you about Kempinski’s portfolio in Egypt. There are only the three properties at the moment in Egypt, right?
Sebastien Mariette: For now, yes, we have three properties. This one [Kempinski Maxim Palace] opened close to five years ago now and has the biggest ballroom in the country so far. So it does get a lot of people coming coming from Europe who have to pass through Cairo to go to another destination, or perhaps they decide to stay here first and after they will go to Kempinski Nile or eventually to Soma Bay.
But we do a lot of events. This is definitely a nice corporate property, so we have a lot of corporate business people who come to work in Cairo and they love this property because we are not far from the city, but at the same time very close to the airport. So, in fact, they arrive from the airport in the evening or early in the morning, come to the hotel, and then we give them advice on when to go to Cairo in order to avoid the crazy traffic.
We have also Cairo Festival City a few kilometers away, which means that a lot of the business people coming from the UAE and also from Saudi know that they have shopping options not too far away. The Soma Bay property is much more a resort, and as you know it’s not too far from Hurghada. And the Kempinski Nile is more like a boutique hotel. love the three properties, and definitely the one in the city center is in a perfect location and you have this boutique feeling when you when you arrive.
MET&T: Exactly. But one of the things that surprised me about this property is the size and quality of the spa. I didn’t expect a hotel this close to the airport to have such a luxurious and enormous spa on site.
Sebastien Mariette: You know, when you enter the hotel you don’t realize the size and the quality of the spa we have. The local community, specifically expats and wealthy Egyptians in the area of New Cairo, they already know about the spa. But when you come to the hotel for the first time, whether it is a corporate stay or MICE, you don’t expect to find a spa like this here. And I think it has been extremely well done.
MET&T: So what about plans for future Kempinskis in Egypt?
Sebastien Mariette: For the three existing property, our focus is driving quality and making sure that we definitely remain where we are. The property in Soma Bay is definitely extremely well known, as is this one here in New Cairo and the one in the city center. But we are always striving to raise the bar.
But as you know, business in Egypt is sometimes up and down. Unfortunately with the Coronavirus, the business is rather down. But this country is like a fuel, so it’s very resilient. And tourism will come back to Egypt. It’s a cycle. The world will settle and tourism will come back.
So we are making sure that these properties remain on the minds of people in Egypt, but also for all travelers coming either to Cairo or to Soma Bay. And then after that, the objective is also to look for opportunities in other key cities in Egypt where we are not yet present. So definitely Alexandria will be a perfect spot for us to be present as well, if we find an opportunity. And then why not in the south in Upper Egypt as well?
If we find any opportunities in those places, we really have to make sure the product fits the Kempinski portfolio up to this level of luxury. But for now, the key is to make sure we continue delivering quality experiences for our guests in our three existing properties.
MET&T: Can you talk a little bit about how Kempinski adjusts in times of downturn and low occupancy? Do you close off wings? Do you send staff to other properties outside of Egypt to continue working? How do you how do you adjust with expat and local staff when when things like Coronavirus or political turmoil are going on?
Sebastien Mariette: We don’t want to let go staff; we want to protect them. We don’t want to implement unpaid leave for the time being because there’s no need to. So for now, I’m focusing on deep cleaning the property and maintenance. So we will close one wing of the hotel, to focus on making sure that everything is in place, and then give staff vacation. The hotel is running now at 25-30% occupancy, so I will keep enough staff to run the property. But otherwise, I will let them take their vacation and spend some time with their family.
It’s already a little bit difficult in Egypt because people will already very much affected by the lack of service charge. In Egypt, you have your basic salary, and then afterward you get an additional amount that comes from the service charge. So when business is down like right now in Egypt, the service charge is considerably reduced. So you don’t want to put another burden on their shoulder by reducing the salary. Not at all.
MET&T: Like you mentioned earlier, Egypt is a place where you know it’s normal, and then you can have a downturn because things are going on regionally or locally. While many hotels significantly discounted prices during times like this, Kempinski and other luxury brands seem to keep to a minimum price threshold. Is that an intentional strategy to maintain the brand image?
Sebastien Mariette: To be honest, there would be no point to decrease prices. If I look at Cairo, no one really did because it will not drive business to your hotel. The entire country is affected, so what would be the point to discount price when we know that the demand is not there?
I feel very comfortable staying in Egypt, but a lot of the people I know who want to travel now, of course, they stopped traveling and they canceled their business trip plus their vacation because they realized it’s very difficult to travel in the world right now. But at least what I noticed and what I do appreciate on this market is that all GMs understood that definitely dropping prices will not drive more occupancy to your property.
What we do now is we focus on the local market. Perhaps a few people will say, “Okay, let’s go to the key to the hotel because this is like a safe place.” And at the same time, we are not in the hustle and bustle of the city. So they can enjoy a bit of peace and serenity not too far from home. But the local markets is definitely our key priority for the time being, and then international business will come back to Egypt, that’s for sure. It’s just unfortunately a cycle we all have to go through.