Business Profiles

Penta Hotels: Reinventing the hotel

In a changing world, the smartest way to do business is to be always ready to go back to the drawing board and ask, ‘Does this still work’? Whatever your product or industry, you cannot simply copy the decisions made by past businesses: you need to re-ask these questions yourself. Penta did just this, and what it has created is a hotel brand with a difference, better geared to the modern traveler, and without the elements in traditional hotels that it feels would slow it down.

Penta Hotels Worldwide GmbH (Penta) is a German company with a presence in both Europe and Asia. In total, 28 hotels across eight countries are in operation under the brand: Paris, Vienna, Prague, Moscow, China and Hong Kong, Belgium, the UK and, of course, Germany. We spoke with Heiko Rieder, Vice President of Venue Management and Reservation, to gain an insight into the energy and operation of the hotel: 

“Penta is a design led hotel brand in the upper midscale segment. The hallmark of our hotels is the Pentalounge – a combination of café, bar, lounge and reception that offers our arriving guests an immediate sense of a friendly gathering space.” 

We weren’t surprised that Heiko was quick to mention this element of Penta– it was the first thing we noticed about the chain too. Looking at images of the Pentalounge, you’d think you were in a modern, industrial-chic restaurant-bar. Brick walls, leather sofas mixed with comfy, mis-matched ones, wooden crates, chrome piping, bookshelves, large overhead lamps and bare bulbs providing low lighting, a deep grey palette; this could be any go-to spot for a night out in any city. Instead, it is the hub of a Penta’s customer interaction, where you can check in at the bar whilst grabbing a drink and eyeing up dinner. 

The design of Penta’s Pentalounges couldn’t be more on trend, mastering the mix of industrial and cozy, with pool tables and pinball machines thrown into the mix. This room alone makes us want to book a stay with Penta, and, if you think this is where the vibe stops, you’d be mistaken. Even some bedrooms in Pentahotels come with table football or pinball machines, and each one carries the same aesthetic as is introduced downstairs. 

Whilst there is a brand tone that runs throughout, the design of each Pentalounge changes from location to location, making sure it’s as in style in Russia as it is in Hong Kong. For example, the Pentalounge in Pentahotel Shanghai is brightly lit and its colour palette uses golds instead of greys, and in Birmingham UK, the bar has a definite British pub flavour mixed in, with a traditional pool table in brown wood and green felt, warm fireplaces and tartan cushions on wing-backed leather chesterfield armchairs. However, throughout every location, the industrial-chic vibe ultimately rules supreme. 

The food in the Pentalounge is exactly what you might hope for if you walked into a restaurant-bar with this sort of look: described as ‘No fuss, just fuel’ by the hotel’s website, we’re talking artisanal burgers and fries, we’re talking pizza, we’re talking nachos, we’re talking steak – and, of course, we’re talking pints and cocktails. Even better, the prices are no different to any high-quality casual dining restaurant. 

Creating the Penta experience wasn’t done in a void – it was done with on-hand market research, aiming to provide the elements and experiences that guests actually want whilst doing away with any traditional hotel elements that are included out of habit but are, in fact, not actually desired. Heiko explained: “In hotels, oftentimes you find several amenities or services which have no value to the guest and are hardly ever used. The minibar or the extensive food menu are classic examples. When we started out it was important to us to neglect these elements and instead concentrate on items that are really important to our guests and do them properly. 

“In the early days we also tested out some really crazy things and learned our lessons from it. I remember very well the feedback we received when we from one day to the next took off all hot items from the breakfast buffet. Our guests reacted really upset and from that day  we knew that breakfast is extremely important to them and decided to not just put the warm dishes back but also added several other items you would normally expect in luxury hotels such as salmon or  sparkling wine.” 

Paying this level of attention to guest feedback is the perfect way to create an experience that people will love and return to. The number of times a stay in a hotel has had frustrating or even alienating moments is, when you think about how personal and customer-facing a service it’s providing, crazy. In contrast, Penta’s willingness to listen to its guests paid off: The breakfast is one of the most highly commented services since over ten years now.”

Another way that Penta has gone back to the drawing board to maximise customer enjoyment is through its shake-up of how a hotel’s back-of-house operates: “We have created a central service office at our headquarters in Frankfurt from where most administrative responsibilities are handled.” This service office is located in Frankfurt, Germany, where the company is headquartered. “This is a core element of our brand concept. When we convert buildings to fit our hotel’s’ needs, we reduce back of house space as much as we can to convert it to public space.” 

Heiko has been with Penta Hotels for 13 years. When he first joined the company, it did not yet have any hotels, but during his first three years with them, the first 13 were opened. “I was initially hired as Manager to create and deploy a centralised concept for both Reservations and Revenue Management which was, at that time fairly experimental (normally, Revenue Management and Reservations are part of the back of house operation located in the hotel.)” Freeing the individual hotels up from hosting this and several other centralized elements allows them to put their teams’ time and resources into other areas: “This way, the hotel teams can fully concentrate on the creation of a unique experience for our guest.” 

With every new generation comes new trends that bleed outwards. With GenZ, Heiko identified this change as being geared towards ‘Bleisure’. “GenZ decision-making process for travel is impacted by more than value for money. Today, travellers look more closely at the values of a brand and the experience they expect when choosing a hotel. ‘Bleisure’ describes the desire for younger generation business travellers to add a leisure component to their business trip.” This shift can probably be credited, at least in part, to the impact of social media, whether this means social media influencers looking for that aesthetic, entertainment factor on their business trips in order to generate more content, or whether it is those consuming such content and seeing the lifestyles of others via Instagram therefore seeking out a similar standard for themselves. Mingling the professional with the social and fun is certainly an element gaining emphasis now that posting attractive and fun social content is a part of how one promotes themselves in a professional capacity. 

This shift has included an increase in week-day stays being extended to the weekend, as well as the need for day use rooms. It has also seen an increased demand for points of entertainment within the hotel, such as its pool and pinball machines, and initiatives such as ‘Penta o’clock’, where Happy Hour on Thursdays is accompanied by an entertainer in a dog costume, if that’s your idea of fun. Personalised walking tours of the local area can also be arranged through the hotel, with which aims to encourage its guests to really get the most out of their stay by getting to know and fully explore the local area. 

Another element that holds higher value with recent generations than it has with their predecessors is CSR. Younger travellers want to know that they are supporting an ethical company with morals in line with their own. Heiko told us that CSR has always been of great importance to Penta, but especially in recent years, it is responding to its clientele by increasing and communicating this focus. Current initiatives include the ‘Souper heroes’ scheme, where every soup sold at the hotel results in another bowl of soup donated to a local person in need through local charities in the communities of each hotel. The company is also involved with beach and park cleaning projects, stocks completely green bathroom amenities from Zenology, and have various green systems that guests are compensated for opting-in on, such as a soon-to-launch compensation for opting out of receiving housekeeping services. 

Penta Hotels was a pioneer when it came to the ‘lifestyle hotel’ concept, in the first wave of companies to think up and trial this sort of approach. It’s hard to say who the very first was, as a zeitgeist is bound to create parallel thinking, but, like with any good idea, it’s catching on. The upper-mid lifestyle segment has increased greatly in the last 5-6 years, in reaction to these shifts in customer priority. “All of these new trends provide lots of opportunities for innovative and creative hotels to differentiate themselves,” Heiko enthused. 

Although it means Penta’s competition is increasing, so is the market, and Heiko isn’t concerned about other companies coming for Penta’s brand: “The hardware nowadays can easily be copied, but the culture of a company is unique. At Penta, we are believers in the fact that every brand can only be as strong as its culture. This starts at the way we source talent, train and develop them and make them proud to be part of our journey.” 

Penta’s approach to its staff, like its approach to running a hotel, differs from tradition in a number of ways. Where these differences occur, the style of management is, again like the hotel itself, more akin to a casual dining restaurant-bar. For example, staff are multi-talented, able to operate the reception as well as serve food and mix cocktails. The company is able to make this change because of its centralising of its administration to, largely, one hub. This also means that each hotel needs 50% fewer members of staff than a traditional hotel of the same size without jeopardising a great guest experience. 

It has been found by many companies that their younger generations of employees are looking for job satisfaction in new ways; even at lower-level jobs, Millennials and GenZ want to feel as though they are making a notable difference within the company. Heiko and Penta are aware of this shift, and Penta makes a point to offer opportunities and support to all of its staff: “Today’s workforce aims for values other than just decent compensation. We invest into development and training schemes, and also ensure all teams are constantly informed about our brands initiatives and events. We invest in collaboration and the feeling of being part of something bigger.” 

This approach has paid off: “There are many examples of team members who started in line positions and made a career at Penta. Our central reservations department has a reputation of a talent factory because it attracted talents who grew in key positions. I love to see my guys develop from within our organisation.”

As well as making sure its team members feel noticed and involved, Penta takes extra care to cater to its guests. “We want our guests to feel at ease when staying with us. We believe our guests value our professional but yet authentic approach towards them and the high level of quality and choice we can offer.” This sense of choice is particularly true for ‘PentaFriend’ – members of an initiative that the company launched in October 2019. PentaFriends receive a number of benefits, including free early check-in, late checkout, discounts, and even a complimentary dessert with their stay. They also have the ability to share their preferences with the hotel so Penta can customise their stay to their liking. 

As a way to enable this extra level of feedback and choice for PentaFriends and other guests alike, Penta is looking towards greater digitisation of its operations. This will also make guest experience smoother. For example, elements as simple as self-check-in will mean that guests can relax in the Pentalounge whilst they checkin via an app and wait to be shown to their room, rather than needing to stand at a reception desk, instantly making their arrival more leisurely and comfortable. 

This move will happen with the support of Penta’s digital partners. Behind the scenes, it already relies on a smoothly digitised system, much of which it credits to IDeaSIDeaS is a SAS company and the world’s leading provider of revenue management software and services. With over 30 years of expertise, IDeaS delivers revenue science to more than 13,000 clients in 129 countries. Combining industry knowledge with innovative, data-analytics technology, IDeaS creates sophisticated yet simple ways to empower revenue leaders with precise, automated decisions they can trust. As the company says, “Results delivered; revenue transformed.”

IDeaS has been part of our journey from the beginning,” Heiko told us. “Thanks to IDeaS’ deeply integrated technology we are able to predict our performance and incorporate it into our pricing strategy most efficiently by pushing updated rooms rates and bedroom inventory out to all distribution channels up to five times in 24 hours.” This kind of digital efficiency allows Penta to run its administration from Frankfurt smoothly, removing issues such as misinterpretation and allowing the company to take care of its administration and logistics without fuss. Having this taken care of allows the company to focus on doing what it does best: taking care of its guests. 

As the company tells visitors to its website; “It is our mission to make you feel comfortable, cosy and welcome. So, enjoy and feel at home in our laid-back lounge, relax in our stylish rooms and be a part of the friendly Penta vibe.” That vibe is distinct to the brand, and whilst Penta is now not the only chain to take this approach, it was one of the first, and it does so with a passion and dedication to its guests that is supported by game-changing behind-the-scenes alterations to the usual hotel format.  By eliminating the unnecessary and instead focusing on delivering the great experiencePenta fully embraces its spirit of a truly unparalleled hotel brand.