Erzsébet tér in the heart of Budapest became a massive building site shortly after the change of regime in 1989. By 1992 the Kempinski Hotel Corvinus Budapest had already opened there as the city’s first Western-style luxury hotel. The Budapest Times spoke to its General Manager, the Dutchman Emile Bootsma, about the past 20 years and the challenges of the anniversary year.
What would you say have been the highlights in the hotel’s 20-year history?
Speaking with colleagues that have been working here longer than me, the name of Michael Jackson, who stayed at the hotel on three occasions, comes up frequently. Our guestbook contains the signatures of hundreds of prominent people but none are as popular as the signature of Michael Jackson. Opposite our hotel there is even a special Michael Jackson tree in the spot where the fans always waited for their idol. Although there have certainly been more important guests, no other celebrity holds such fascination. Another highlight was and is the Formula 1 race in July, even if since 2008 it has essentially shrunk to just two days instead of the four to five days in the past. Another highlight was the shooting of Evita. Madonna and Antonio Banderas were guests at the hotel for six weeks. The actors who have stayed also include Jeremy Irons, who spent six months here on two occasions. And then there are the many highlights that are more to do with technology. As the first Western-style luxury hotel in the city, we have always emphasised innovation. We still have the urge to be the first when it comes to new things. Recently we presented an iPad wine menu and we are the first five-star hotel to install charging stations for electric cars.
What has been the reaction to the charging stations?
There are already a few people who use them. Of course, there still aren’t enough electric cars in Budapest, simply because the sale of such vehicles is lagging behind. However, at the end of the year Mercedes, for example, is bringing the E-Smart onto the market. French carmakers are also expanding what they have to offer in this field. Today, for example, we received an Opel Ampera to try out. I think there will be change in the next one to two years. It will gradually pay off that we invested in this field at an early stage. And while there may not be any queues at our charging stations at this time, we are already benefitting from them. For example, the existence of the stations is another reason for their operator, E.ON Hungaria, to hold events at our hotel. And their presence has encouraged other companies to hold conferences here. I am fully convinced that the time of electric charging stations will soon come.
What will be the highlights of the anniversary year?
We gave a great deal of thought as to how to celebrate our 20th anniversary. For our fifth, tenth and fifteenth birthdays we threw a huge party. This time we wanted to do something a bit different. At big parties many partners who are treasured by us can be neglected simply because of the size of the event. We therefore decided on many smaller special parties and receptions instead of one mega party. We would like to have the chance to thank as many people as possible who have played an important role in our 20-year history, including guests and suppliers. There will be two special events for our staff. We will also be engaged in additional charity activities. Reflecting our strategy of having many smaller highpoints, we will have many hundreds of cup cakes, instead of one huge cake.
In other European cities cup cakes are already very popular. In Budapest we are the trendsetter. In our hotel we are offering cup cakes with a special Hungarian flavour. Using a small syringe filled with Tokaji each guest can inject a spritz of flavour into their cake. With their colours and original designs, the cup cakes are youthful and fresh. At five-star hotels there is often the risk of occasionally becoming too staid in adhering to tradition. We try to counteract that in many ways. Luxury is also about sometimes doing things that others don’t. The main thing is that the quality is always high. That is extremely important at Kempinski. It’s an exciting balancing act between traditional and renewal. The name of our hotel is fitting: King Matthias, named Corvinus, stood in his day both for tradition and for modernity, for innovation. And of course luxury – he was a king, after all.
How has business been in your anniversary year so far?
Things looked up in 2011, not least because of the Hungarian EU presidency, which was excellent for our business. The second half of the year continued to go well. January 2012 wasn’t bad either. The Malév bankruptcy then threw a spanner in the works. It caused a decrease of around 25 per cent in the five-star segment. However, the situation got back to normal following the February shock. We anticipate that our total business in the first six months of this year will be around five per cent below that of the previous year. That may not sound a lot but you need to consider that we are coming from a very deep trough in 2009.
Has the Malév bankruptcy affected all hotel segments to a similar degree?
No, it mainly affected our market. The three-star and four-star hotels have benefitted from the situation. There are more flights to Budapest than before but around half of those are with low-cost carriers. It’s not that our guests necessarily avoid such flights but it’s true to say that their preference is not for budget flights. In some cases, that is based on purely practical considerations such as group bookings. With airlines that are only available over the internet it’s very difficult, if not impossible, to book 100 seats or so at one time. There’s also very little flexibility in terms of rebooking. In addition the airports are often located out of town at the given destinations. Those are naturally important factors that also have a negative impact on our business. Moreover, we have not only been partly cut off from our target customer segments but also from our target markets. For example, the quality of connections to Scandinavia, China, Israel, Russia and the USA has suffered greatly. Parts of Spain and Italy are no longer adequately covered. Luckily our two most important markets, Germany and Great Britain, have hardly been affected thanks to Lufthansa and British Airways. Lufthansa alone now has 69 flights to Budapest weekly.
Does Hungary need to have a national carrier again?
A lot of things would be easier if there were a national carrier, such as flying tourism partners to Hungary, organising press trips or bringing conference organisers here for a good price. All that worked very well with Malév and the Hungarian Tourism Association, not least because a national carrier has a very different commitment to its home market. The plans for a large convention centre in Budapest, which has been called for by the hotel industry for years, can be put on hold for now. What should be done with a huge convention centre if we cannot get people to Budapest? Without a large convention centre and now without a national carrier too, demand is likely to be somewhat thin on the ground.
In such a situation Hungary needs first-rate marketing. How do things look?
There is still a great deal of room for improvement. In order that full-service airlines give greater consideration to Budapest or for the critical passenger mass for a national carrier to be reached, every effort needs to be made to boost demand for Budapest. For that we need excellent marketing but also more events like the Sziget Festival and the Formula 1. Thermal baths alone, not all of which are even in a presentable state, and the constant spotlight on them in the marketing materials for Budapest are not up to the job. Thermal baths are not a unique selling feature any more. If Budapest continues to be advertised with the creaking cliché of chess-playing pensioners in the baths, there should be no surprise that demand is not at the highest. Indeed, such pictures can even put off potential guests who are younger and more active. Budapest has so much to offer. Just think of the many young designers, the unique bar scene or the fantastic architecture. With all due respect to tradition, we need more than just thermal baths and goulash. Guests should come not for one day but for three or four, which means they need to be offered something more. Look at Prague and Vienna, where the people in charge of marketing have managed to get the city firmly anchored in the minds of European city tourists. Budapest can learn from this.
It’s surely also a question of money.
Yes, of course. The lack of funds is plain to see. That’s why I find it particularly regrettable that of the four per cent we have to pay on all room turnover, less than a quarter is directed towards city marketing. It would make sense to reinvest the money in the thing that you want to get money from again in the future. Destinations can get forgotten. Our industry is therefore calling for more support for tourism by Budapest and the state, as well as the elaboration of a development strategy for Budapest. Synergies can often compensate for lack of funds. For example, together with other expat directors of five-star hotels I take part in destination marketing activities within the Hungarian Hotel Association, the various chambers of commerce and the Winter Invitation committee.
What is your view of the current business climate in Budapest?
Recently somebody said to me on this topic that “Budapest is all dressed up but waiting for the sun to shine”. I think that hits the nail on the head. The city has everything that one needs but somehow the sun doesn’t want to come out. There needs to be more business. The development and implementation of new concepts unfortunately takes longer than under more favourable circumstances. Investors and owners are reluctant to embark on new projects when they are unsure of the future and how long it will take to pay off. As a hotel we are constantly working on various projects of differing sizes. Sometimes we only launch smaller projects like the cup cakes or the iPad wine menu but there will surely come a time again when we can take on larger projects too.
Currently Hungary not only has the task of selling what it has to offer better, but also of counteracting the damage done to its image by negative reports in the Western media.
Yes, it’s sometimes shocking what is written abroad about Hungary, evidently by people who are lacking knowledge of the country. It’s true that there is plenty of room for improvement in Hungary but I don’t find the situation anywhere near as bad as it’s made out to be by some Western media outlets. It would be so nice to read much more presenting Hungary in a good light internationally. That would also be good for Hungarian national pride and self-esteem. It would also be very important for tourism to be more strongly represented in the government.
How would you sum up the situation?
There are some clouds in our anniversary year but it’s also sure that we won’t let them spoil our celebratory mood. Because we have been so long on the market we can take a rather calmer approach. We can float above the clouds and appreciate the sun where others can only see the gloom.
Some illustrious guests:
Michael Jackson, Gloria Gaynor, Tom Jones, Britney Spears, Lewis Hamilton, Michael Schumacher, Jenson Button, Fernando Alonso, Johannes Rau, Roman Herzog, Helmut Kohl, Joschka Fischer, Mario Adorf and Christian Wulff.