Where Service Meets Style

Raffles hotels, the peninsula, Shangri-La—such names evoke images of impeccable service in luxurious surroundings, sometimes harking back to a bygone age. Asian brands have been gradually expanding to the Middle East and the Americas, and soon they will add one more destination to their offerings: Paris.

By the end of the summer, Raffles Hotels & Resorts and Shangri-La Hotels and Resorts will each open their first European property in the City of Light: Raffles in the refurbished Royal Monceau, a stone's throw from the Arc de Triomphe, and Shangri-La in what was once the palace of Prince Roland Bonaparte, Napoleon's great-nephew. In 2012 the Peninsula will join them when it opens its first European property in another historic Paris building.

Why France? For Asia's top luxury hotels, the goal is to offer a familiar and trusted setting to Asian travelers while building brand awareness among Westerners. Tourism in Europe suffered during the global economic crisis—the number of visitors to Europe fell 6 percent from 2008 to 2009, compared with a 2 percent decline in those visiting the Asia-Pacific region and a 5 percent slide to the Americas—but France remains a magnet for tourism, with more than 79 million visitors in 2008. And it's increasingly popular among Asians; indeed, Asia was the only region in the world to send more tourists to France in 2008 than 2007, up 5.3 percent.

More important, Chinese tourists are now outspending all other visitors in France on luxury goods—including high-end accommodations. Last year they overtook the Russians in luxury spending, representing 15 percent of all tourist spending in France, according to the VAT payback-services provider Global Refund. Chinese spending rose a whopping 47 percent, to €155 million; by comparison, tourists from the United States spent €64 million, up 1.9 percent. And Chinese are sticklers for brands they know. They tend to look for hotels with Chinese-speaking staff and Chinese-language brochures and materials, as well as familiar food, notes Paul Tchen, general manager of the Peninsula Shanghai. "A foreign menu can sometimes be intimidating, and they need a fallback to avoid losing face from not understanding what the menu says," he says.

Paris is only the starting point. Shangri-La has projects planned in Vienna, London, and Moscow, while two well-known Asian luxury-resort brands, Banyan Tree and Six Senses, have plans for the Greek coasts. (Meanwhile, American brands like Hilton and Starwood are focusing their attention on Asia, adding lots of new properties, particularly in China.) But having built their names on outstanding service, Asian brands could find it harder to live up to their reputations, given Europe's higher labor costs. Their challenge is to determine how much to reflect their Asian roots versus their local environments. Shangri-La Paris, for instance, will have a Cantonese gourmet restaurant. But Raffles is opting for a decidedly more French approach, with an interior designed by Philippe Starck. "Raffles Hotels & Resorts may have originated in Asia, but we have always preferred a style where each of our hotels reflects a sense of its destination," says company president John Johnston. And each destination, in turn, will reflect the Asian values on which the chain built its reputation.