After my last post I did receive a lot of DM’s asking me about my take on the Marriott International take over of the citizenM hotels brand. Rather than answering these all separately I will just pen down my thoughts here.
First of all it is good to understand the why. citizenM hotels did run an operational loss of more than 40M in 2023 and the numbers in 2024 weren’t probably that good either. This made a sale unavoidable. After all, bleeding cash like this isn’t sustainable. Ergo, the sale was not by choice, but by necessity.
So, how did it come to this?
– Too many key people left in a short period of time. This all happened around the time that the Founder Rattan Chadha did step down as CEO. The heaviest lost of course being Michael Levie, who I would describe as the heart and soul of the hugely differentiating citizenM culture. A culture which I think can not be emphasized enough as crucial for why people want to stay at citizenM. But also people like Matthew Bell, Michael Reiner, Lennert De Jong (good for CM they have him back) did leave and this took a toll on the company. Not only in terms of loss of culture but also by leaving a vacuum for the real estate boys to move into.
– Too many hires. When I worked at citizenM hotels there always was this awareness about and focus on being lean. All functions that were not essential for the direct operation of a hotel would be done from the HQ in Voorschoten. And I can remember the need and urge to bring in bookings if we wanted to get paid by the month’s end. It probably wasn’t that dramatic a situation, but the mindset was clear: do more with less.
In my case that would mean I was leading a skeleton crew of 1 or 2 people (hi Joep Haan) (true, with some outside help, hello Stefan Elsner, Matthias Huettebraeuker, Dean Skidmore and Daniel Tobin) to bring in an annual website revenue of around 200M. Doing all website development too. If I now would have to make a conservative estimation, there are currently around 30 – 50 people doing something in marketing, website development, etc. Unfortunately the revenue didn’t see that 20x multiplier. Worse: in-sourcing probably did lead to an increase in fixed costs that are hard to shake when things take a turn for the worse.
And looking at some of the job titles currently I cannot help but wonder what they mean and what the people behind these humming titles actually do.
– Branding & Marketing got silent. One of the strongpoints of citizenM hotels has always been the brand and the marketing. The brand was radical and bold and the marketing was straightforward and highly effective. Now the website looks tired and uninspired. The same photo used 5 years ago is still on the homepage. There is no content marketing going on, no brand story, no effort to tell the guest what kind of hotel citizenM is and why she should stay there.
I wish #cM all the best for the future. If there is one person that could bring them back on track it is Lennert De Jong.