> Star Ratings

Star Ratings

After 35 years in the hospitality industry, I still can’t tell you what a five star hotel is.

There. I’ve said it. This so-called expert in the hotel industry doesn’t know something as simple as that!

Think about it, however.  Hotels are really complicated things, selling services (e.g. overnight accommodation), manufactured goods (steak pie and chips) and commodities (a bottle of beer) in multiple outlets, in hundreds, sometimes thousands of transactions per day, between invariably different human beings.  How can you possibly categorise a diverse creature like that using just two words – five star?  Did you know that, until very recently, there was no such thing as a five star hotel in Paris?  The system there used one star to four star, four star deluxe and Palace hotels, for the top properties in heritage buildings.

The star rating system, which varies from place to place, was originally invented for consumer protection.  In the absence of any other sources of information, other than the brochures produced by the hotels themselves (this was, of course, before the advent of the internet), the automobile organisations, such as AAA (in the USA), the RAC (UK) and Michelin (France) produced guidebooks for their members motoring around the country.  Thee organisations gave their own opinion of the quality of each hotel, so that members seeking something of a high quality would know that the “five star” (according to the guide) Grand Hotel was a better quality than the “three star” Very Grand Hotel, before they arrived – because, as we all know, names can be misleading.

These systems of star ratings developed, and they do work to some extent – we all know that a one or two star hotel is likely to be pretty basic, a three star hotel will be kind of average, a four star hotel – well, that’s something better than a three star, and a five star is all about luxury.

But they are still not particularly good definitions, are they?  Basic, average, luxury?  One guest’s luxury is another guest’s average, after all.  Take some of London’s hotels as examples – the Hilton on Park Lane, the Dorchester and the Grosvenor House are all five star hotels, but cater to quite different clientele – a regular guest at one probably would not in his or her lifetime want to stay at one of the others.

This lack of definition may be of little consequence to an investor in the hotel industry – or it may be of fundamental significance.  I am involved in the development of a hotel in Nigeria, which ran into trouble because the owners agreed a joint venture arrangement with a contractor, and it was stated in the contract that the contractor, now part of the ownership of the hotel, would build a “three star hotel”.  It had been assumed by all sides that there was a commonly-held definition of that term, but the quality of work produced by the contractor was far below that expected by the original owner.  The result was, of course, disagreement after disagreement, and the joint venture collapsed, leading to delays and increased costs.

And consider also the developer who wants to create a very high quality, cosy and private boutique hotel in Ghana, with say 50 rooms, a fine dining restaurant and bar – but cannot qualify for a five star rating, as the Ghana grading system stipulates that a five star hotel must have at least two restaurants and a conference room for a minimum of 300 persons.  The impact of this is that our creative hotel developer is unlikely to be able to achieve the required yield from the hotel because, with his four star grading, the perception of the guest will be that he cannot charge as much as the five star hotel across the street.

What’s the solution?  It’s already there.  Two relatively recent developments make star ratings far less relevant.  One is the increased availability of information, from all sources but particularly on the internet, where sites such as TripAdviser.com provide guest feedback on hundreds of thousands of hotels, warts and all.  In addition, hotels and booking agencies can provide pictures of their facilities, so that prospective guests can make a judgement regarding the quality of the hotel pre-arrival.  Of course, the camera can lie, as can blogs, but still a great advance on a subjective assessment of “quality”.

The second solution is hotel branding, a subject which I have commented on before in this column.  The Holiday Ins and Hiltons of this world have no interest in being classified as three, four or five star, they have already classified themselves – as Holiday Inn or Hilton!  These chains commit considerable sums each year to product development and to consumer research, so that what they offer under their brand name is what the guest wants, and what the guest expects.

I mentioned earlier that star rating systems vary from place to place – there is no such thing (contrary to what many people think) as an international star rating system.  The International Hotel & Restaurant Association (IH&RA) argues against any attempt at harmonisation – would it really be appropriate to specify the same level and extent of facilities and services at hotels in New York and Ouagadougou?  Of course not, and travellers would not expect it.  Even in Europe, there would be confusion between the French insistence on having a bidet in the bathroom, and the British not knowing quite what it was for!

The IH&RA doesn’t advocate scrapping the star rating system altogether, as this “common-sense approach” works for some, if not for me.

And no, I have no idea what a “six star” hotel is!

Trevor Ward

W Hospitality Group, Lagos



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