Club Med plots international growth, aims to broaden appeal

MIAMI—Club Med aims to open five new resorts per year, on average, over the next five years as part of its international growth strategy. It also has plans to execute five major renovations to its current resorts each year.

As part of this strategy, the company is breaking ground in exclusive locations, like Sicily, Italy; Savoie, France; and Hebei Province in China. Family-friendly properties will also see renovations, including updated technology across all 70 existing Club Med resorts.

Xavier Mufraggi Club Med

“For more than 65 years, Club Med has continuously worked to improve and adapt to consumer demands and trends,” explained Xavier Mufraggi, CEO of Club Med North America. “This entrepreneurial driving spirit has allowed us to remain an energetic and diverse place for travelers with upscale accommodations, superior sports programming, enriching children’s programs, gourmet dining and legendary hospitality skills.”

Like many in the industry, China has become a very important market for Club Med. The brand is testing a new venture for the company: a short-vacation-style hotel concept to introduce the brand to the Chinese market as part of its strategy to expand across Asia. The Club Med Joyview project will create a number of new hotels in China over the next few years. All hotels will be within a three-hour drive from a major city in China, and feature upscale amenities and premium services.

The Joyview hotels will allow guests to choose either a bed-and-breakfast option or an all-inclusive package. Two resorts just recently opened in China, with another one scheduled to open later this year: Club Med Joyview Golden Coast in Hebei Province; Club Med Joyview Anji in Zhejiang Province; and Club Med Joyview Great Wall, which will also be in Hebei Province.

“It was created to recruit new guests from China who might be shy about going to international all-inclusive Club Med locations,” he said. “After one week in our Joyview properties, which are all in Mainland China, we see that they are willing to try the Club Med brand itself.”

The company will also be expanding its presence in other areas of Asia. Club Med Ho Tram, close to Ho Chi Minh City in the southeast of Vietnam, will be the first property to open in the country in 2021. In Indonesia, Club Med Lombok will be the third resort for the brand to open in the country, set to open in 2019. The company also recently revealed it will open Club Med Ceylon in Sri Lanka in 2019, and a new 5-Trident Exclusive Collection resort in Seychelles in 2020.

In North America, Club Med plans to open its first resort in Canada in 2020 in the Le Massif de Charlevoix region. “Canada has been number one on the list for 15 years of where guests want us to be,” said Mufraggi. “Europeans, North Americans—everybody loves this location. It was an obvious location we were looking at, but we really wanted to be a pioneer on this.”

He continued, “For our first time, we wanted to be in the Quebec area because we wanted to find a location that can be full in the summer and winter. There is a huge trend of tourists from France going to Quebec every summer. There are a lot of North Americans going to Quebec summer and winter, at the same time… We are going to create this project as the most advanced in terms of experience, which means that everything we are going to do—from construction, design, supply—we want it to be from 418, which is the telephone area code of the region. We are making sure that anyone who is going to be on that property is going to feel that genuine feel of what Quebec is all about.”

As for the upcoming renovations, Mufraggi told Hotel Business that the process first started 10 years ago. “The goal at that time—which is really our business model—was that we really wanted to move into the affluent market,” he said. “We needed to have our resources following the desires of our guest. It was really a business model question and clients’ expectations that we start directing the affluent market into all-inclusive, so they needed to have facilities at the level of what guests experience every day at home.”

Club Med Kani in the Republic of the Maldives is being renovated.

Over the years, the perception of the all-inclusive segment has changed. “When we look at studies from 10 years ago, it was really segmented—50% of the wealthy market felt that all-inclusive was not for them,” he said. “They saw all-inclusive as a lot of food for a lot of people—very mass market.”

The image completely changed, according to Mufraggi, after the Great Recession. “The midscale market started to disappear by itself, because people operating three-star all-inclusives would disappear; they couldn’t sustain the business model,” he said. “When we did the same studies we did in 2006 10 years later, we realized that now 80% of the affluent market was interested in the all-inclusive category.”

Now, guests are seeing the same level of service as they would get at other high-end properties. “You will find the same hospitality level and services, which was not the case 10 years ago,” he said. “We have everything, from the activities and the experience… Affluent clients [are]80% of our clients today.”

The renovations will help the company meet the guests’ demand for experiences. “If you don’t bring something new, if you are not always at the top in terms of quality, you [won’t] be considered by the market and clients,” said Mufraggi. “They always want to have the best experience. With websites like TripAdvisor and all of the word of mouth you can have, the moment you let it go in terms of your product, then you lose your client satisfaction. That is where you need to make sure that you always have enough CapEx investment for all of these renovations.”

The renovations are also adding innovations. “When we did our project in Punta Cana two or three years ago, we did renovations, but we added an adult concept called Oasis, which is stunning rooms along a magnificent hundred-yard pool, and services,” he said. “We also created a new experience with Cirque du Soleil called ‘Creactive’ at the same time.”

He continued, “Each time we do a major renovation, we find a way to bring something different to that property. It is making sure that your standard as a brand for the affluent market remains at the top level. At the same time, we have 70 properties, so we try each time to have a little difference, what we call the ‘must-try’ experience that people can do on the property, and there is no other place on earth that could do that experience. That is what drives the innovation and creativity of our team.”

The company has also been focused on technology innovations for its properties. Among them are the bracelets given to guests when they arrive. They have a chip in them that allows them to open the door to their room and make any payments. “Everything we do is to make sure our clients have better satisfaction,” said Mufraggi.

Earlier this year, French and Italian resorts began offering “Easy Check-In,” which automatically opens a property account for guests prior to arrival without requiring a stop at reception, followed by “Easy Check-Out,” which charges the credit card on file so there is no need to close out an account.

This year, the company is installing new capabilities to the Club Med Resort App that allow guests to access information about sports, dining, activities and events. The app will now allow guests to make direct requests to the housekeeping or technical teams to save time. Guests will also have the ability to book services through the app, such as spa appointments, excursions and specialty restaurant reservations.

The brand is also working with Google Street View to allow guests the chance to tour the resorts and their rooms prior to arrival. Currently, 25 resorts worldwide offer the Street View option, including Club Med Sandpiper Bay in Florida, Club Med Punta Cana in the Dominican Republic and Club Med Cancun Yucatan in Mexico. The company is working on expanding the list throughout the year.

Club Med Cefalù will open this summer in Italy.

Club Med has also seen a large increase in the number of families it attracts. “The climate itself, demographically speaking, has completely changed, because in the 1970s, or even at the end of the 1980s, our clientele was one-third singles, one-third couples and one-third families,” said Mufraggi. “Right now, we are 70% families, 20% couples and only 10% singles—and sometimes that is defined as the grandmother flying with the rest of the family. We really moved to the family market.”

This move to attract family travelers has led to renovations to meet their expectations. At Club Med Cancun Yucatan in Mexico, the Aguamarina area, with accommodations and spaces dedicated to families, will receive an expansion to introduce 60 new family rooms—30 Family Club rooms and 30 Family Deluxe rooms—along with a new oceanfront pool. The renovation will increase the capacity of the resort and accommodate travelers with the creation of a second resort center dedicated to families.

While the team tries to be responsive to what guests want, there is one area they are very careful with. “They want all of the connectivity possible in their room,” he said. “We make it possible to do things, but our team is going to make sure that for the kids, the adults leave their phones in the safe in the room and are not spending their time with the phone, but actually enjoying the experience.”

Mufraggi wants guests to disconnect to reconnect. “At the beginning of the week, the parents leave their kids at 9 a.m. because they need to recharge, need to reconnect as a couple first, but by Thursday and Friday, the dad or mom is going to take one of the kids, and go sailing together or play tennis together,” he said. “We work with our team to give ideas to the parents to take their kids for some one-on-one time. We need the parents and the kids to disconnect.” HB

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