Redefining Luxury: What’s the Next Big Change in Hotels?

Innovating is about challenging established orders to create something new. This is why creative mavericks can, at times in their lives, find themselves on the wrong end of the law. If wisdom and experience aren’t there to keep it in check, the impulse to break rules and sometimes bend them can lead to irresponsible behavior.

Ian Schrager, a well-known name in the hotel industry is an example. Schrager, along with Steve Rubell, founded Studio 54 in New York City before he designed any hotel. Many stories have been told about this cultural icon. We also know that Schrager, Rubell were convicted of fraud accounting.

We will leave it at that, the lessons learned. After the business partners were released, they began putting their unique talents to work in hotels. The first hotel they opened, Morgans Hotel is widely regarded as the first boutique property in the world. It proved that elegance and sophistication can be affordable. It made the hotel lobby a place for socializing – something that millennials often credit with their success.

2018 has seen Schrager’s desire to disrupt the hotel industry gain new relevance. In June last year, the Public Hotel New York opened its doors. It is a 367-room hotel in Lower Manhattan. Schrager described the hotel as a “democratization of luxury” in a Fortune Magazine interview. The hotel offers a unique marriage of luxury and economy, with rates starting at USD $200 per night.

It’s as simple as this: A guest who pays $500 per night or $1000 per day will expect luxury at every turn, from service and style to food or beverage. However, guests will be amazed at how luxury can be afforded in New York City for a modest amount. They will exceed their expectations. Schrager’s goal is to disrupt our perception of luxury.

Many people in the industry believe it is impossible. They remind us that luxury cannot be offered at this price. Schrager believes it is possible, namely by asking the right question. Are people willing to have scripted interactions? Are they willing to have their luggage towed up the steps in exchange for cash tips? Are white linen and fine China truly a modern luxury experience? Or can they get better experiences in more efficient ways.

This may all sound like standard “millennial” talk. It is easy to assume that Schrager’s latest project is a nod or marketing exercise. There is also a coworking space in the lobby. In the basement is an entertainment space. This age group is often associated with limited service models.

Schrager said that “building a hotel to accommodate millennials” was the worst idea he’d ever heard. He believes great ideas don’t have to be limited to one demographic. They are universally applicable. Great ideas are a common theme throughout history.

Why is there so much skepticism? Why is it that hotel industry disruptions are often dismissed by people who should be keeping their pulse on the matter?

It is easy to see why successful disruptions can transform into established concepts. Many of the most innovative hotel designs are obvious after the fact. Many hotel groups are creating socially-focused hospitality models. In the meantime, an innovator from old school is updating traditional ideas about luxury. It’s possible, who would have thought?

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