Piers Schmidt contributes article to ‘Branded Residences: An Overview’

8 June 2023

We are pleased to highlight the contribution by Piers Schmidt, the Founder of Luxury Branding, to ‘Branded Residences: An Overview’, the recently published report by Graham Associates.

Known for his branding experience in the hospitality sector, Schmidt reveals some crucial insights about the concept of differentiation in the industry.

The title of Schmidt’s piece, ‘Differentiate, Duplicate, or Deal?’, perfectly encapsulates his evaluation of the modern hospitality sector’s scenario. Drawing on the legendary adman Jack Trout’s principle of ‘Differentiate or Die’, Schmidt explores how brands must offer their customers a compelling ‘difference’ to survive the relentless competition.

Schmidt underscores how differentiation has become a source of competitive advantage, allowing brands to distinguish themselves in crowded markets. This principle is not exclusive to hospitality, as Schmidt vividly illustrates with examples of the best cola, the flame-grilled burger, the expensive beer, the world’s favourite airline, and the rental company that ‘tries harder’.

Particular attention is given to the rapid growth of the global lodging industry post the 2008 financial crisis, leading to an explosion of brands. However, he draws a stark contrast between the proliferation of brands and the lack of real differentiation in the industry. The dilemma is posed – should brands focus on differentiation, or is duplication more appropriate in certain contexts?

Schmidt further highlights a trend among established luxury hotel brands towards simply repackaging existing concepts rather than providing genuine innovation. This extends to the world of branded residences, which he observes are often little more than ‘skin-deep’ differentiation attempts. Developers lean heavily on licensed brand names instead of investing in truly unique offerings.

A particularly intriguing point Schmidt makes is the fundamental difference between a branded residence and a hospitality brand. While the former’s primary role is to create awareness and stimulate desire for potential buyers, a hotel brand is judged by its most recent performance. This distinction highlights the contrasting priorities and goals of these two types of branded establishments.

In his conclusion, Schmidt offers a warning to investors in seemingly differentiated branded residences: “Caveat Emptor,” buyer beware.

This compelling article from Piers Schmidt is sure to stimulate conversation and further examination within the hospitality industry. His exploration of differentiation, duplication, and the deal-making inherent in the sector provides invaluable insights for those looking to understand the dynamics at play in branded residences and hospitality alike.

We encourage anyone interested in differentiation in the hospitality industry and the future of the increasingly interdependent hospitality and branded residence sectors to delve into Schmidt’s enlightening contribution in ‘Branded Residences: An Overview‘, which is edited and published by Graham Associates.

Advisory

Luxury Branding is a strategic advisor specialising in generating sustainable brand value. Its principal experience is in the ultra-competitive premium segments of the tourism, travel, hospitality and residential real estate sectors.1

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With a unique blend of ‘calculated creativity’,
Luxury Branding helps ambitious organisations to define and express how they are special, different, and better: special for their affluent customers, different and better than the competition.2

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Luxury Branding introduces NXGN, a suite of four specialist services designed to facilitate luxury brands in the experience economy to forge meaningful and enduring connections with this distinctive cohort.3

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