Since its launch in 2008 in Amsterdam,
CitizenM
has done
things a bit differently than most of its competitors.
Its rooms are small, about 150 square feet, and much of
that space is taken up by a wall-to-wall king-size bed. The rooms also have a
large shower and a widescreen TV - as the company says on its website, “supersized
essentials, nothing you don’t need.”
The idea is that guests will use the room
to sleep and refresh, but if they want to work or socialize, they’ll head down
to the “living room” – the large ground floor space designed with a mix of cozy
corners and open spaces (and free Wi-Fi) for working, relaxing and eating at the
24/7 café, CanteenM.
The brand is designed for “mobile citizens” – hence the name
CitizenM – and since day one it has welcomed anyone to use its lobby for work, initially for free and then starting in early 2019, as popularity grew, for a fee
of about $20 per day.
This corporate subscription: It was really a recognition of a need – a screaming need basically from a lot of people.
Lennert de Jong - CitizenM
Now, as the COVID-19 pandemic has upended traditional office
space and created thousands more “mobile citizens," CitizenM is aiming to
become the brand they choose for both work and stays with the offer of a
corporate subscription.
The idea is to give companies a place to convene dispersed
workers and to give employees a place to work and a place to stay if they live
outside the city but occasionally travel into town, for example to spend a day in
their company’s office or to have a meeting.
“We started talking to corporate real estate planners ... to
see what companies are planning long-term. And in April it dawned on us that this
remote-first strategy is going to stay. Big companies will have a large portion
of their workforce work from home, so what consequences does it have for our
investment plans, what consequences does it have for our business model?” says
Lennert de Jong, chief commercial officer for CitizenM.
“This corporate subscription: It was really a recognition
of a need – a screaming need basically from a lot of people.”
For a flat fee of $600 per month, users get three nights in
any of the brand’s hotels worldwide with no blackout dates, plus breakfast and a welcome drink for each
stay, three hours of meeting room use and unlimited use of the “living room”
workspace – 24 hours a day, seven days a week. There’s also rooftop space at
some properties.
De Jong says the idea of a subscription plan had been in
development for some time, but the company knew it would only make sense when
it could offer a large enough supply of hotels in cities around the world. That
number now stands at more than 20, with many more in development. Combining that with the challenges of the pandemic – both the new needs of companies and of
CitizenM for predictable revenue - made this the appropriate time to launch the
offer.
“The opportunity really sits at the moment during COVID
times. Pre-COVID this would have been an unattractive deal for us, because we
were selling rooms at $300 night in New York so why bundle it and sell it for $600.
So this opened up the opportunity to do this,” de Jong says.
“Instead of ... a stupid loyalty program
when you get a card and start collecting points, why not try to go for something more explicit
with this group of people?”
CitizenM is not the first hospitality brand to entice workers
to use the hotel as their office, but its model differs from what is being
offered by Accor and many independent properties in that it is not focused on the
use of the hotel room.
“If you look at a normal hotel, they have more square foot
in their bedrooms, but they don’t have public space. Public space has always
been an enemy of the hotelier, because it’s not revenue generating unless it’s
a restaurant and you usually outsource that. The lobby is really just for you
to wait until you are checked in,” de Jong says.
“But in most places our lobbies are the largest of any hotel
in the city. So we don’t need to go to the bedroom.”
For now, CitizenM is in the early stages of talking to
mostly smaller companies and individual entrepreneurs about the subscription
option, and de Jong says feedback has been very positive. Larger companies will
be next on the prospect list, which grows as the brand continues to open new
hotels around the world.
Next week, CitizenM opens in Washington, D.C., and in the next
few years de Jong says the brand will open 18 new hotels across Europe and the
United States, including a hotel contracted by Facebook and sitting on its campus
in Silicon Valley.
“This [corporate subscription] is a logical consequence of
something we started from day one - that we are the company for a very specific
target audience,” de Jong says.
“There’s a lot of space for us to grow in at the moment.”