Title image for article The world's biggest challenge
TEXT Anke Pedersen

The world's biggest challenge

How can we tell that Shanghai is top of the list of the world's most dynamic metropolises? A look at the number of hotels is enough: Tripadvisor lists an incredible 5,351 establishments for July 2018 – a world record! And a nightmare for anyone who needs to position themselves in this market.

Downtime? There's no such thing in Shanghai. Since the opening up of China in the course of economic reforms in the early 1990s, the former trade metropolis has made every effort to build on its glorious past and to lure the whole world to Huangpu. The first to answer to the call were international hotel chains. "In 1990, there were only three international hotels in Shanghai," says Shanghai veteran Gerd Knaust. "Now all the names are represented, from the luxury to the budget segment." From A for Aman to W for Wyndham, from Andaz to Waldorf Astoria.

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Location as an attraction: the French Concession with its western feel

Even premium brands such as Four Seasons and Shangri-La now have more than one hotel there, thanks to an economic boom that has been ongoing for decades. That's to say nothing of the outstanding array of hotels offered by big chains like Marriott. "We've now opened 32 hotels," says Rainer Bürkle, who, as Area Vice President for Luxury in Greater China, is responsible solely for Marriott's luxury brands such as Ritz-Carlton, Bulgari and JW Marriott. "A further 52 are planned." That's just in the luxury segment! Just at Marriott!

The demand is there. As early as 2016, as a look at HRS's booking figures shows, Shanghai, along with New York, was one of the most frequently visited business travel destinations outside Europe. And remarkably often, it's Germans who are at the helm of new flagship hotels such as the W The Bund (Bürkle: "It hit like a bomb"), the Capella or the Kempinski flagship Grand Kempinski. Is it just coincidence? A hotel director from Germany is actually regarded as an independent quality seal in this country, which is mad about premium brands. And that's exactly what counts in a market in which each new arrival delivers even more splendid architecture, an even more unusual design and an even more refined F&B concept in a bid to stand out somehow from the overwhelming competition.

Few people know that better than Gerd Knaust. On 1 January 2018, he took over the management of The Kunlun Jing An in the heart of the historic French Concession. "Kunlun", named after a mountain range in western China, is the name of the new premium brand with which Jin Jiang Hotels, which until now has focused mainly on the budget segment, hopes to catch up with western competitors. Knaust is aware that it's a Herculean task. "A German general manager is good for your international image."

Conditions actually aren't that bad. The 56-year-old has in fact been managing the 714-room hotel since 2010, although until 31 December it was under the Hilton Hotels flag. And although major enticements such as the Hilton Rewards programme are no longer available to him, the hotel, which opened in 1988, was regarded right up until the change of flag as one of the best-known and most successful in the city. The German manager will therefore not be starting from scratch.

We cannot and should not try to teach the Chinese.

On the contrary, Knaust says that this district in particular, which has a very European feel, brings many of his business guests and long-standing regular customers back. "Within a radius of about four kilometres, you've got a thriving restaurant and bar scene with countless wine bars and pubs, lots of boutiques, offices and a rapidly growing scene for young Chinese entrepreneurs." Even the world-famous Bund is only a 15-minute walk away.

Or the brand-new Capella Jian Ya Li, an urban resort comprising 55 historic villas and 40 residences, managed by Dorian Rommel. The self-contained complex of houses in the Shikumen style, which was common up until the 1930s, consists of several narrow cul-de-sacs with buildings placed close together, in which hundreds of families once lived cheek by jowl. It's mainly the well-heeled Chinese elite that seem to appreciate this contrasting mix of the poverty of their ancestors and the standards of a Capella hotel in the 21st century.

Service is key

However, the thing that really allows a hotel to stand out in Shanghai – Knaust and Rommel share this view with all of their international colleagues – is the service. There's barely anyone who does not complain about the shortage of skilled workers and about a training system that focuses less on understanding than on learning by rote. Experienced staff, especially English-speaking ones, are a real find. Particularly when it comes to courting "'western companies' like Siemens, for example", as General Manager Knaust highlights.

Admittedly, it is not possible to tell from the prices being charged whether a hotel will honour its promises of service. Not when you take into account what is probably unparalleled competition, which prevents even top hotels from achieving their usual rates. In Shanghai, a hotel's ranking on review sites such as Tripadvisor et al. is therefore regarded as the actual measure of its success. It's not for nothing that Knaust is proud that Tripadvisor lists the world hotel The Kunlun Jing An in 72nd place out of 5,351 after only six months. And it's not for no reason that professionals like Rüdiger Hollweg always respond personally to guests' comments. The GM at the Grand Kempinski Hotel Shanghai has a formula. "The Chinese are always right," he says. "We cannot and should not try to teach them." 

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A homage to the 1930s: Ritz Carlton's bow to the Belle Époque

Guest reviews are paramount

Naturally, it's not just due to Hollweg's touch that Tripadvisor currently lists the Grand Kempinski in 18th place. The 686-room hotel, the company's largest, owes a large part of its success to its location in the heart of the Pudong free trade zone. Where in 1990 there was little more than boatyards and farmers tilling their rice fields here on the eastern side of the river, today it's the towers of the international financial, insurance and high-tech elite shaping the view and the world-famous skyline. Right in the middle of it all and opposite the Pearl Tower, a major landmark, is a free-standing statement building under the Kempinski flag.

Its USP? "The Grand's name stands for great and majestic," Hollweg explains. The group's flagship hotel thus greets guests with architecture that is both spacious and flooded with light. However, the truly magnificent thing and the icing on the cake in the five-year-old glass tower is the views of Pudong and the Bund, whether it's from the rooms, which are at least 43 square metres in size, the conference rooms, the bar, the spa or the 20-metre pool on the 30th floor.

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Superlative style 
at the Mandarin 
Oriental: the biggest suite in Shanghai and a 360-degree terrace

A homage to culture

But even Hollweg – like his successful colleagues – achieves his occupancy rate of over 80 per cent by making the odd concession to his Asian clientele. That includes charging stations for prosperous Tesla drivers as well as the glass sculpture by Frank Stella in the lobby, which naturally is bright red. "In Chinese culture, red represents fortune," the GM explains, "as well as wealth and luck." His guests can indeed consider themselves lucky. Whether it's in the Executive Lounge or the Spanish restaurant, for the renowned gourmet Hollweg it's more than just professional concern that makes him ensure the quality and range of food and drink at his Grand Kempinski is at least above average. It's what he should do, too – with direct neighbours like the Mandarin Oriental Pudong. His colleague Clemens Hoerth's hotel lies directly on the bank of the Huangpu, which means that his guests can book boat tours or take the ferry to the Bund on the opposite bank. Above all, however, it doesn't take long for a chain such as Mandarin to nod to the culture and tradition of the People's Republic – it's part of their DNA and their self-image.

The 362-room hotel thus not only boasts the city's largest presidential suite at 788 square metres, the most extensive collection of contemporary Chinese art with 4,000 works and an F&B concept that really stands out, even in Shanghai's dynamic restaurant scene. As the uncontested number one, the Mandarin Oriental also knows what it's doing when it comes to service. Nevertheless, the GM is used to success and is visibly displeased that his hotel has just dropped down to second place out of over 5,000 on Tripadvisor. There's no way he will accept such humiliation.