A room at Raffles, in Paris or Morocco

Iconic hotel group aims for 30 properties worldwide by 2012

When it was bought over by American owners in 2005, controversy erupted: How could you sell what was a historical icon and quintessentially Singaporean brand name, asked some. Today, the Raffles Hotel brand is spreading like wildfire to some far-flung corners of the world.

Indeed, within the first 10 months of its acquisition, the Raffles family had more than doubled the number of properties in its fold. It has its footprint in exotic tourist hotspots such as Marrakech, Morocco, and Traslin, Seychelles.

Its resorts line has also ventured into the Maldives (Raffles Resort Konottaa), the French Polynesia (Raffles Resort Taimana Tahaa) and the West Indies (Raffles Resort St Lucia).

And the aggressive expansion shows no signs of abating — the aim is to add 10 more properties to its stable of 20 by 2012, said Raffles’ managing director Diana Ee-Tan.

But, more than two years on, most Singaporeans have little clue of how well the family of the 121-year-old grand dame of Beach Road has done, since its S$1.45-billion sale to equity firm Colony Capital International.

And for some, the doubts still linger: Is Raffles truly Singaporean anymore?

Such scepticism never fails to get Ms Ee-Tan’s hackles up. “What the acquisition has done is only to give us greater opportunities for the brand, in terms of growth and global extension. Nothing has changed.

“Singaporeans should feel proud that a home-grown brand has spread its wings,” said Ms Ee-Tan, who recently sat down with TODAY in her first full-fledged update to local media since the takeover.

A similar issue resurfaced earlier this month for Robinson and Co, when Dubai’s Al Futtaim Group took over the 150-year-old local department store. There has been talk of expanding the Robinson brand overseas and synergies with other brands owned by the group.

Six months after the sale to Colony, Raffles was merged with the Fairmont chain of hotels under the Kingdom Hotels group and went on an expansion blitz.

Some saw it as an ominous sign that things would never be the same again under foreign stewardship — considering how Raffles grew from one to only eight hotels within 10 years, when it was in local hands.

But Ms Ee-Tan said the intent had always been to grow the brand and the opportunities merely lacking two or three years ago. What drove the growth, she said, was the active property market around the time of the acquisition and the knowledge that the Raffles brand had “finally come of age”.

“In our early years, we were very careful. Brand-building takes several years and it is very important that you do not just put your brand on any building.”

Another factor that fuelled the rapid expansion: Raffles went from owning to managing hotels. This meant that the company didn’t have to come up with massive funds in order to start operations in a new location.

The company also started selling residential units on most of its new properties, thus cutting the time needed for developers to reap their returns.

But what of comments from some quarters that they have sold out for their ambitions to grow?

Said Ms Ee-Tan: “The company respects the pedigree of the Raffles brand, the legacy of Raffles and has ensured that all attributes have been protected.”

Indeed, about 80 per cent of the people driving the company’s plans now are the same staff as when Raffles was still Singaporean-owned, she added.

Success to Raffles is not about having hotels in many places, noted Ms Ee-Tan – it is having “special hotels that will endure and preserve the quality and dimension that guests have come to expect of Raffles”.

Branding experts TODAY spoke to agreed that foreign owners do not necessarily detract from a company’s history and legacy.

Mr Dominic Chew, planning director of Y&R Singapore, said “the man-on-the-street might not even be able to tell the difference”.

“What has Raffles lost? It still remains a national monument and its quality of service has not suffered. Guests wouldn’t see or feel that there’s been a change of ownership,” he said.

Should people feel such strong “nationalistic” sentiments whenever beloved Singapore brand-names are sold to foreigners?

They should only worry if new owners “forget the roots” of the company they have taken over, said Ms Monica Alsagoff, chief executive of CommunicationsDNA.

“As long as the owner cares about preserving the identity and personality of the icon, and doesn’t make drastic changes, Singaporeans should rest easy.”

In fact, Singaporeans should learn to understand that takeovers are purely business decisions. Mr Chew said: “Raffles is an icon because of its culture and service standards. It actually gives more chances for more people all over the world to experience a local brand.”

But “nationalistic” sentiments actually do some good too, noted Ms Alsagoff.

“When there’s opposition, it puts pressure on the management to keep the important things. It tells them ‘don’t mess with our history’,” she said. “The companies that buy our Robinsons and Raffles do so because they recognise that it’s a strong brand and they’ll know it makes sense to keep the essence.”

As Ms Ee-Tan put it: “Raffles Hotel is synonymous with Singapore. It’s a monument; an icon. The association is a positive one for us, why would we want to lose that?” – TODAY/sh

Source : Today – 28 Apr 2008

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