Eight years and US$470 million later, The Dolder Grand, Zurich’s most elevated urban resort, has achieved the intent of its renovation.
Since re-opening in 2008 after closing for a four-year upgrade, the 175-room hotel has hosted the likes of Hillary Clinton and Leonardo DiCaprio but equally important, locals in the city. The Swiss market comprises a 20% share, followed by an international mix of around 12% to 15% each from the US, the UK and the Middle East, and smaller percentages from Russia and Germany. China is fast growing, already at a 4% share, and there’s a strong pick-up from Southeast Asia and Australia as well, according to Managing Director Mark Jacob.
The hotel also has a loyal following – 40% of guests visit 15 to 20 times within a period of three to four years. Not quite money-down-the-drain skeptics thought the renovation might be, it is doing an average occupancy of 60% and a rate of CHF760 (US$770).
Perched on Adlisberg Hill overlooking Lake Zurich and the city, the 175-room hotel looks imposing, fairytale-like – even bereft of guests from the outside. But a visit on August 25 found its immense spa (4,000sqm with 18 treatment rooms) fully booked and all 47 seats for dinner taken at its two Michelin-star restaurant. The outdoor terrace and lounge/bar of its newly renovated all-day dining Saltz (14 GaultMillau points) was also packed that evening.
Breaking down any perception that Dolder Grand is unapproachable is what Jacob has been doing since joining at pre-opening in January 2007. A young, humble MD whose parents ran the 5-star Suvretta House in St. Moritz, Jacob tells HOTELS what his metrics are compared with a hotelier running the typical hotel, and debunks the notion that the owner does not need to make money.
HOTELS: What’s the idea behind the hotel acquisition/renovation for the owner (Swiss billionnaire Urs E. Schwarzenbach) and what has been achieved?
Mark Jacob: The owner grew up 10 minutes from the hotel, so it’s a person that has a connection to the place almost his whole life. His idea certainly was to give something back to the community and city, but he’s also an investor, a person with business sense, and one who likes to do real estate projects.
Back in the 1890s, this place was like a recreational park for the locals due to its hillside location and abundance of nature. A private entrepreneur saw how the city was growing fast and people had a need for leisure time, so he built a restaurant (now the Dolder Waldhaus, 4-star sister hotel close to the Dolder Grand), and a tram.
Remember that 120 years ago the city was farther away and people didn’t have cars, so the tram was a breaking idea and remains today what connects us to the city.
Four years later in 1899, he built this hotel, which opened only during the warmer months as there was no heating. In 1915, it became year-round and a destination for international travellers.
Coming back to the idea behind the hotel acquisition/renovation, the owner wanted to remake the roots of this company as a city resort for the next century.
H: We’ve seen private money trying to revive luxury hotels/places in Switzerland – Villa Honegg (Qatar investor), 7132 Hotel (Swiss entrepreneur), Chedi Andermatt (Egypt investor), to name a few. What does it take to revive a place?
MJ: Having a unique positioning, building up the brand and winning the trust and confidence of guests, and having a spirit of openness and friendliness are some factors.
For us, we’re a leisure property. We don’t see ourselves being in competition with the city hotels. Our offering is much broader. No other hotel, for example, has the spa that we have. There’s also food, golf and art – a collection of 150 artworks with iPads that allow you to do self-guided tours.
It’s all about finding reasons for people to come. You try to create your own destination, so it’s not that people stay at Dolder Grand because they happen to travel to Zurich, but they travel to Dolder Grand because they can combine nature and wellness with the city.
Nowadays, people have choices; the Internet makes everything transparent. But a lot of times, experienced travellers are now asking, which experience – not which destination – are we going for? And that’s when destination Dolder Grand needs to pop up.
H: So you don’t compete with the city hotels like The Savoy, Park Hyatt, Baur au Lac, etc., for corporate business at all?
MJ: No. More than half of our guests come here to spend their leisure time whereas Zurich is known for corporate business. We do a lot of meetings and incentives – other brands like to position themselves with a brand like ours.
We also cater to the spa and wellness market; we live in a time where there is a lot of stress and people want to change quickly from being immersed in work, to relaxation and recovery.
And, of course, an important guest mix is the local community. What makes a hotel interesting to international travellers is when they can see the locals who are here be it for weddings, birthdays or our Sunday brunch. More than 50% of guests at our two restaurants are locals.
H: How are you able to bring the local community back, considering there are so many great restaurants and hotels today in the city?
MJ: The restaurants and lounge/bar are the door openers but we also do lots of events that the local people could join, like our annual Epicure Gourmet festival which features 12 guest chefs, including four three-Michelin-star chefs. We also do lots of weddings as you’d always want to return to your wedding venue even if it’s not every year.
I think, though, it’s all about making people feel we are open and approachable, rather than making them feel daunted to enter the hotel.
The tricky part is having the right balance between being too perfect and too approachable. There’s a fine line. Of course, we want perfection in our service delivery, but it has to be friendly and personalized – not stiff. But it also cannot be too casual that people don’t feel it’s special anymore.
H: How do you achieve the right balance?
MJ: If you do service from the heart. We use the HeartMath technique (a U.S.-based non-profit that unlocks people’s natural intuitive guidance for making better choices). It’s about the inner balance, bringing you to a position where you can sense better, in our case the needs of the guest, hence deliver better service. Everything is around empathy. Every guest wants something different and wants to be treated differently.
We did an intensive HeartMath training for 60 to 70 upper and mid-management staff, and basic training for key staff in guest relations positions.
After all, what is quality nowadays? People, especially our clientele, are wealthy. Staying in a beautiful place does not make you happier, may be just for a short time. Enriching experiences are more intangible and they are also memories. It’s about the emotional experience in the end.
H: It must be coming from the top as you are very approachable yourself. Does this trait come from being in a family of hoteliers and seeing traditional Swiss hospitality at work from young?
MJ: Of course, I owe that to my parents a lot. I share their dedication to being a hotelier and understanding what it is about. As a hotelier you are a host. You invite people to your home and you host them. Of course, in a hotel like this with 400 staff it’s impossible to be there 24 hours a day but my goal is for every staff member to play a part. Why do you do a certain job? Why are they here? That’s the critical point. If people like what they do, like to be a host, like to create an emotional experience, then they are the right people. This is something you can’t train. You can train the standards, procedures, etc., but this does not create the difference. They will do things correctly – a lot of hotels do it right – but it’s the heart that makes the difference.
H: People wonder how on earth the owner will recoup the investment. Is it true that’s not his objective and what then are your metrics compared with the ’normal’ hotelier?
MJ: What is correct is that the owner gives us a lot of financial stability.
Going back to your earlier question what it takes to open a hotel like this and make it successful, it takes an approach that isn’t short term. You need to be able to sustain a longer period to build step by step a new destination, a new brand and what it stands for, especially as we are an individual hotel not affiliated to a chain.
It takes four to five years of delivering quality and proving you can keep it. A lot of hotels don’t have that financial muscle. They are under pressure to deliver results in the first quarter otherwise it already gets very tight. This is the difference.
But in the end, an investor is an investor (i.e., he wants to recoup investment) and that applies in any business.
H: So you’re judged by the usual occupancy, rate, RevPAR?
MJ: Absolutely. But he doesn’t look at these figures only. A project like this has to do with prestige and knowing that the owner’s perspective is a long-term one, not monthly. I’m judged by whether or not my strategy is the right one that will bring us success in the future, rather than whether I have been successful in the past month.
A hotel also lives on its customers; it is made by its customers. You like to go to hotels where you feel you identify with the other customers. But if your goal is short-term, you’d say it doesn’t matter which guests stay here, you just want to run maximum occupancy. Is that the right way to build up a living brand? For us it’s not.
So it’s a different approach. I’ve worked with chain hotels, which can’t be managed like this. For an individual hotel, it’s all about the relationship and trust between owner and management and we work very closely together. That is the reason why we can take such an approach.