AMResorts Turn 10

 

 

Alejandro Zozaya
Alejandro (Alex) Zozaya founded AMResorts 10 years ago, but got his education in luxury hospitality well before as general manager of the Fiesta Americana Cancun, among other hotel jobs.

 

Alejandro (Alex) Zozaya, president and founder of AMResorts, traveled out of the country 56 times last year, and that doesn’t even include domestic trips. It’s a fast-clipped life for a man who hadn’t intended to go into the hotel business at all.

Indeed, Zozaya, who hails from Mexico City, thought he would go into broadcasting and never even thought of the hotel industry until a crisis situation helped to steer his fate.

It was 1985 and Mexico City was hit by a devastating earthquake. Zozaya lost his home and moved in with a friend whose father was a shareholder in Fiesta Americana, the largest hotel company in Latin America. The gentleman thought Zozaya would do well in the hotel industry, but Zozaya instead headed to Europe where he ended up in London working in the kitchen of The Moscow Club. "One day, the executive chef didn’t show up and the chef told me to stop doing dishes and come and help him," Zozaya tells Luxury Travel Advisor. "He liked what I was doing so I never had to go back to the dishes.”

Because it was a private club, the food and beverage was not a profit center. “It was more about service and good quality,“ says Zozaya. Next stop was to a steakhouse with a B&B outside of London where he was eventually promoted to manager. “That’s where I learned a little bit of the lodging side of the business," Zozaya says. "Then I knew this was what I wanted to do for a living.”

Three years later, Zozaya headed back to Mexico City to nail down that opportunity with Fiesta Americana, which almost instantly became a dream job; Zozaya was asked to assist in the opening of the Condesa Cancun Resort, which was hosting the Miss Universe pageant. His assignment was to oversee the hosting of the 80 young women vying for the title. He was 22 and his career was launched.

There were more traditional activities that involved opening the hotel, including testing a different room every night to see if the showers in each worked. “I slept for a full year, every night, in a different room and I started falling in love with the whole business of hotels, not just the food and beverage, but all of it, from the signing of the hotel to the construction," Zozaya says. He moved up into sales and marketing and realized he had a passion for that as well. That passion shone through and he was subsequently promoted to vice president for all of Fiesta Americana in Mexico City. But there was still one job he hadn’t held in the business, so he requested to be made general manager at the Fiesta Americana Cancun.

AMResorts

President: Alejandro Zozaya

Vice President, Sales and Marketing: Kevin Wojciechowski

Hotels: 26 hotels with almost 10,000 rooms in operation in Mexico and the Caribbean

Brands: Zoëtry Wellness & Spa Resorts, Secrets Resorts & Spas, Dreams Resorts & Spas, Now Resorts & Spas, Sunscapes Resorts & Spa Resorts

Affiliations: Preferred Hotels & Resorts and The Leading Hotels of the World

Parent Company: Apple Leisure Group

Website: www.amresorts.com

“I learned every single area and, most importantly, the whole business of hospitality by running all of the areas, so that was a great experience.” Life was good. He he had gotten married along the way and his wife, who was from Pennsylvania, was enjoying Cancun and it was easy for them to commute back and forth to Philadelphia. “I still think that being a general manager of a hotel is one of the best things that can happen to you," Zozaya says. "Especially at a resort; you work harder because it is really non-stop, especially on holidays. When everyone is having a holiday, you’re working.”

After 13-plus years with Fiesta Americana, Zozaya and his wife moved to the United States with the plan to launch a new all-inclusive hotel company. “I knew there was a niche where we could make an impact on the industry,” he says.

The results? AMResorts was launched 10 years ago with the concept that the all-inclusive resort market was under-serving a well-off American clientele. Today, Zozaya oversees an expanding portfolio of 26 luxury all-inclusive hotels under five brands in Mexico, the Dominican Republic and Jamaica. And there are other signs of success: The entire luxury portfolio has been granted membership with Preferred Hotels & Resorts (just one property is a member of The Leading Hotels of the World) and resorts across the brands have been winning accolades from the consumer press.

How did he do it? “We provided an American way of delivering things; we understood that, for Americans, the No.1 priority when they travel for pleasure is safety, more than price and weather,” he says, noting that 10 years ago, many all-inclusive providers were focusing on the European market.

The safety issue extends beyond the social climate—this market also wants to be safe from getting sick. For that reason, they want to see the food brands they see at home. “I knew that ketchup had to be Heinz,” says Zozaya. “I do have homemade, wonderful ketchup made in Jamaica. Guess what? Americans want ketchup and that ketchup is Heinz. We knew the brand of the mustard, the mayonnaise, the yogurt, the soft drinks and we knew it was particularly important to serve water in bottles, even if it was more elegant to put it in a silver jug.”

That credo of serving the U.S. traveler is followed to a tee in other ways: For example, the TV selections provided at AMResorts reflect what the U.S. market would prefer to view—if an important soccer match is scheduled between Italy and Germany and there’s an NCAA basketball game slotted for the same time, basketball rules.

Menus were changed for the U.S. market and dinner times were set earlier than a European 8:30 start. No restrictions were placed on choices, wristbands were considered taboo and there was no exchanging a ticket for a beach towel. In came concierge services, 24/7 room service and minibars in guest rooms.

Entertainment was also provided at AMResorts' properties to dispel the notion that luxury has to be boring. “You have beautiful hotels all over the world and a lot of them have these magnificent marble lobbies, but the restaurants are half empty and you have to get out of the hotel and go to the local bar or the local restaurant where the action is,” says Zozaya, whose next strategy was to get rid of the “all-inclusive” moniker. “There was a huge connotation—although I think it’s changing—in certain markets where they think all-inclusive means buffet, wristbands and limitations. It may mean fun and convenience and [a good] price, but certainly not luxury, so we moved from calling it all-inclusive to calling it ‘unlimited luxury,’” says Zozaya.

On The Horizon

AMResorts is knee-deep in a flurry of expansion, particularly in Mexico. This summer marks the debut of Secrets Huatulco Resort & Spa, Secrets’ first foray into the Mexico Pacific coast. In addition, AMResorts has two developments underway in Puerto Vallarta: Secrets Vallarta Bay Puerto Vallarta and Now Amber Puerto Vallarta, set to open in 2012.

In May, AMResorts debuted two new Punta Cana properties as part of a $150 million two-resort complex: Secrets Royal Beach Punta Cana and Now Larimar Punta Cana.

 

To this day, when Zozaya comes across those who are hesitant to try an all-inclusive resort, he’s always ready to change their view. When they say they’re not sure if all-inclusives are for them, he asks how much they paid for breakfast, or a glass of scotch or a safari tour when they traveled to South Africa with Abercrombie & Kent. When they reply, “nothing,” Zozaya says, “Well, there you go. You’ve been in an all-inclusive experience.

“It doesn’t matter how much money you have. That you can open a menu and there are no prices, that you can finish dinner and say ‘thank you’ and  leave without signing a check or leaving a tip—that’s when you really feel like you're at home,” says Zozaya.

The unlimited luxury experience is not a cheap one, but it does provide a sense of good value to the guest, he says. But how does such a company make a profit when it doesn’t really know how much the guest will consume once they’re on property? There are patterns to human behavior, Zozaya tells us.

“The operation costs of the first day and the last day are more because people tend to drink and eat more,” he says. “But I have to tell you, the sophisticated customers know they don’t have to run to the buffet, because it’s all à la carte. And when guests open the menu and see what we serve, they are surprised to find that they can order lobster or salmon and that they can order a bottle of wine and that it really is included. Once they get used to it, they settle in and they go back to their normal pace.”

At the top of AMResorts' luxury line is Zoëtry Wellness & Spa Resorts, which carries the tag, “The Art of Life,” and focuses on wellness and environmental friendliness. The brand, now with four locations (two in Mexico, two in the Dominican Republic), launched when AMResorts took over the Five Diamond Paraiso de la Bonita in Mexico’s Riviera Maya. “It’s a new luxury,” Zozaya tells us. “It’s responsible luxury.”

The Zoëtry brand, which is all-suite, tends to have smaller hotels with fewer than 100 very high-end accommodations. “Our direct competition would be the higher-end brands in the market like Four Seasons and Mandarin Oriental, or Rosewood or any of the Orient-Express hotels,” says Zozaya. “It’s green and it’s healthy, and has a strong sense of place.”

While Zoëtry is not adults-only, it’s not ideal for kids, he says. Price points range from $550 to $600 per person per day, meaning it’s more than $1,000 per day, per couple. “It is not a cheap experience, but it’s a wonderful experience. In this brand, we don’t call it unlimited luxury; we call it endless privileges, because it goes one step above,” says Zozaya. Extras include private transfers from the airport with fresh juice and tea provided. Also included are long distance phone calls and laundry services. For room service, a chef comes to the room and prepares the meal right in front of you and the resorts tend to buy a lot of local products or grow them on site.

“We have local handicrafts and the local community gets involved; if there’s a local choir, we bring them in to sing to the guests; we have cultural lessons, Spanish lessons and lessons on eating what you fish, not just fishing.”

Zozaya says that Zoëtry suits the new luxury customer, who is no longer showy about being affluent: “Luxury is not going to come back in the superficial, artificial way that it was, with no deep meaning behind it. Sophisticated people who have money and education are going to get behind the products that stand for something.

“Zoëtry is the antithesis of the ostentatious mind. It’s luxury, but it’s a good understanding of luxury,” says Zozaya.

 

Bonita Riviera Maya
Zoëtry Para iso de la Bonita Riviera Maya is set on 14 acres and has its own private beach.

Hotels that become part of the Zoëtry portfolio have to be “beautiful and small and luxurious, but also located in areas where we have real competitive advantages," says Zozaya. This means new Zoëtry hotels must also be in places where AMResorts already has a hotel infrastructure with its other brands, he says. “So, in the back of the house, I can provide wonderful value and services at a much lower cost. I don’t need to have an executive chef that charges me $200,000 a year, because I already have one next door. I don’t need a general manager who would make more money than the total profits of the hotel every year. I need to have a great host who is a well-educated person—outgoing and able to interact with guests and act as if guests are at home. I don’t need a controller, a human resources or a purchasing manager, because we share all those resources in the back of the house.”

The adults-only Secrets Resorts & Spas brand is focused fully on romance, a niche that encourages a longer length of stay and helps with seasonality at the resorts. “We have a huge honeymoon market, and honeymoons in the U.S. tend to happen right after the weddings, and those weddings, which are typically in May and June, are in low season for us. Very few people get married at Christmas or Easter.”

Zozaya emphasizes that Secrets is not just for couples because groups and incentives and wedding parties come in with single occupancies. Seventy percent of the clientele, however, skews toward honeymoons and romantic getaways. “It’s sensual, it’s very romantic, it’s not a swinger’s place and it’s not a party place,” he says. There are currently seven Secrets open, with three in the Riviera Maya alone.

The Dreams Resorts & Spas brand is modeled after Secrets in terms of luxury and romance, but accepts children as well. “We have an average of 400 weddings per hotel per year—more than one per day. Some properties have 600 in one year, and that’s a huge market,” says Zozaya. “It’s very important because they book well in advance. They’re less price-sensitive. They use other additional services like the spa and beauty parlor, premium champagnes and they always bring in other crowds. The length of stay is longer because they combine honeymoons with weddings, but most importantly, they get married in the low season.”

Zozaya says special care was taken to not brand Dreams as a family product, “because once you become a family brand, you become a lot less price-sensitive and more seasonal.” Additionally, he felt travel agents might steer clients away from Dreams if they didn’t have any children. “So Dreams is very romantic—still sensual, still very attractive for honeymoons—but it’s a great place to go with kids.” Important to know: Dreams always has an adults-only dining room and an adults-only pool.

The newest brand of AMResorts is Now Resorts & Spas, which was launched when the company realized it had the opportunity to expand in destinations where it already had a presence with its existing brands. “We already had three or four Dreams Hotels in Punta Cana, the Riviera Maya and Puerto Vallarta and we didn’t want to saturate the market with the same brand,” says Zozaya. At the same time, AMResorts observed a trend of couples traveling without family and for a shorter period of time, therefore requiring a more intense experience.

As a result, Now was created as a “live the moment, live the now” brand, with all of the design, the music and the menus in the restaurants at Now hotels having a more “hip, spicy, intense type of mood.” The price point is the same as Dreams, Zozaya notes.

Delivering Luxury

Luxury delivery at a hotel is always dependent on the skills of the general manager. As such, Zozaya interviews everyone who is vying for the top post at one of AMResorts’ properties.

“We don’t value experience as much as the attitude and we don’t want to hire anybody who feels that their top performance is already in the past,” says Zozaya, who was a general manager himself for five years. “I don’t want anybody who wants to be in the comfort zone, because we’re not in a comfort zone. We want people who are interested in being on their way up. The best attitude is for those guys to say, ‘I am in the best position I ever had. I am making more money than I ever did before, and this is just the beginning of a growing path.’”

Training is also vital in such an organization, since AMResorts is bringing on thousands of new employees a year. The company is very hands-on (Zozaya picks up his own phone and answers e-mails directly to those throughout the company). It tends to attract those who thrive in that sort of environment. New employees are also trained in the culture of the company.

“I ensure that when you work with us you learn pretty fast, and I think people like it,” says Zozaya.

Because of the dynamic pace of it all, Zozaya is quite open to hiring people from other industries so they can bring fresh ideas to the organization. “We try to be surrounded by people who are self-motivated because the key of success of our company, the glue among all of us, is passion. You will see that consistently across our organization, and on every level, you see people with a lot of passion doing what they do—and that’s the most important ingredient.”

Zozaya runs a very slim organization from the company’s headquarters outside of Philadelphia, with fewer than 40 people in sales and marketing (which is overseen by Vice President Kevin Wojciechowski), customer service and website management, as well as development, the unit that he heads up. Instead, Zozaya prefers to put most of his 16,000 employees near the customers they’re serving.

 

Secrets Wild Orchid Montego Bay
Secrets Wild Orchid Montego Bay’s Presidential Suite. The resort stays true to its tagline: Unlimited Luxury.

A new relationship that has proven to be valuable for AMResorts is the one with Preferred Hotels & Resorts. “Preferred became very important for us because they are endorsing our concept," Zozaya says. "The relationship with Preferred has to do with operation standards, which force us to operate better. We have someone that is going to be a detective—like a mystery guest that is going to come and evaluate us—and we relate the bonuses of the executive of the hotel with our Preferred ratings, so they are forced to do it right."

Thinking globally, Zozaya can envision a Secrets in Thailand or Bali, but he feels, at present, there is plenty going on right where he’s operating now.

In fact, Zozaya says that AMResorts will continue to grow in the Caribbean and Mexico “because there is still a lot of opportunity there for more hotels and brands within the same islands. I see our growth being more multi-brand concentrated on fewer destinations where we can really compete rather than having one single brand in multiple destinations. It’s a different model; I’m not saying which is better, but for us, this one works very well.”

One of the biggest changes Zozaya has seen is that the customer is now demanding the all-inclusive product. “It stands on its own feet now," he says. "I’m glad the travel agents make a lot of money, but the consumer loves it and comes back very happy. A lot of people who’ve never stayed in an all-inclusive before stay at our hotels and say, ‘You know what? I want to go back because it was a much more pleasant experience.’”

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