The German Russian

Azimut Hotels is expanding; this year alone the Russian hotel group wants to add another 10 hotels to its portfolio. German CEO Walter C. Neumann has been managing the Moscow-based private company since autumn 2013. His objective: to digitalise all three- and four-star hotels in Russia and Europe as quickly as possible.

text: Uwe Lehmann  //  photography: Frank Herfort

2018 is sure to be an exciting year for the CEO of Azimut Hotels. "The Football World Cup is a particularly important event not only for Russia, but also for us as a hotel business," explains Walter C. Neumann. The group has eight hotels, positioned in the mid-scale segment, in the match venues of Moscow, Sochi, St. Petersburg and Novgorod. "In the first two weeks of the tournament, we're almost entirely booked up; for the second half of the world cup, large quotas have been reserved," the manager explains.

Expansion in the East and West

Azimut currently has 29 hotels in Russia, Austria and Germany, plus three more hotels in Central Asia. They now intend to open five more: in Russia, or the territory of the former CIS states, Germany and Czechia. In Eastern Europe, the group is primarily concluding management contracts and in Western Europe, lease contracts.

But how can it be that a native German is presiding over a Russian hotel group? In fact, neither Moscow nor Azimut Hotels is the 53-year-old's first stop in Russia. Shortly after completing his apprenticeship at a German Swissôtel, Neumann, who comes from the fourth generation of a family of hoteliers and gourmets, travelled to St. Petersburg to become Front Office Manager in the renowned Grand Hotel Europe: from Germany to a country in a state of upheaval. Neumann muses that this was his "most formative post". In any case, it was here that he met his now wife, at the time his colleague.

After five years in St. Petersburg, in 1997, Neumann answered the call of Lindner Hotels, a German hotel company, and returned to his home country as General Manager of Lindner BayArena Leverkusen and later, Director Development. To this day, he remains friends with Lindner executive Andreas Krökel, whom he had already met during his apprenticeship. After a stop in Munich, Neumann eventually ended up at Travel Charme Hotels in Berlin in 2006, first as Director Operation, then as Managing Director. "During that time, we built a house in Berlin which we still own," says Neumann. "That's why I now regard Berlin as my home in Germany." A perfectly practical arrangement, given that Azimut Hotels' European office is located there too.

The objective: happy guests

Nevertheless, Neumann also has a home in Russia now, too. When Rocco Forte offered him the job of managing the Astoria and Angleterre hotels in St. Petersburg in 2010, he moved back to his adopted home. This was also the year his second daughter was born. "It's important to us that our children get to know both our home countries," says the man who is at home in two cultures. This is particularly the case in St. Petersburg: the couple now lives with their two daughters, one a teenager, the other of primary-school age, in St. Petersburg, which is approximately 700 kilometres away from Moscow, and Neumann goes back and forth between the two.

No wonder: when Azimut Hotels – Russia's largest hotel chain in terms of room numbers and geographical coverage – offered him the opportunity to switch from GM to CEO in 2013, Neumann didn't have to think twice. He didn't consider the change from the luxury hotel industry to upper middle class problematic, or even a downgrade. On the contrary. His objective remains the same, says the "man with rough edges": to make guests happy.

Of vital importance: a good price-performance ratio

"For Russian guests, in particular, the price-performance ratio is a matter of great importance," summarises the CEO of the group, which was founded in 2004. "We operate in the three- and four-star industry and are able to offer performance and, importantly, services at fair prices." Reasonable products are therefore more important than mainstream ones or innovations at any price. This approach seems to be paying off: the Azimut hotels in Moscow have an average occupancy rate of more than 80%.

That is despite all the sanctions following the Ukraine crisis. "We've more than offset the slight decline in visitor numbers owing to the sanctions with new guests primarily from China, India and Iran," explains the CEO. What's more, his company has hardly noticed the restrictions. "Companies from other countries have stepped into the breach and more is being produced in Russia itself."

Focus on digitalisation

Special attention is being paid to digitalisation. The Russian clientèle is very digitally minded, says Neumann, something also evident from its use of digital travel portals. His company currently generates some 30% of its bookings over digital channels, of which 60% are made via OTAs and 40% through their own website.

In one of his Moscow hotels, a new company app is being piloted, which guests can use to control all hotel processes. With one exception: independent app-based check-in and check-out won't be possible in Russia any time soon. Neumann: "We need to copy every guest's passport on check-in."

Nevertheless, people are increasingly investing in these sorts of tool, stresses Neumann: "New media and technologies are extremely important for our communication and represent one of the main challenges to moving our brand forward." The CEO sees his company as well positioned for that: already in 2017, the Azimut Group received the "Russian Hospitality Award" for Best Hotel Developer.

Expansion continues

Even after the planned new openings this year, the expansion is set to continue. "We're still interested in the top locations in Russia; we're already present in most of the 15 cities with over 1 million inhabitants. But we're also considering smaller locations. And we want to grow in Eastern Europe, too. We're interested in gems like Bulgaria," says Neumann.

When asked whether he'll be cheering on the German team or the Russian team in the World Cup, though, the man, whose German friends jokingly call him "the Russian", is giving nothing away.

Focus on digitalisation

Special attention is being paid to digitalisation. The Russian clientèle is very digitally minded, says Neumann, something also evident from its use of digital travel portals. His company currently generates some 30% of its bookings over digital channels, of which 60% are made via OTAs and 40% through their own website.

In one of his Moscow hotels, a new company app is being piloted, which guests can use to control all hotel processes. With one exception: independent app-based check-in and check-out won't be possible in Russia any time soon. Neumann: "We need to copy every guest's passport on check-in."

Nevertheless, people are increasingly investing in these sorts of tool, stresses Neumann: "New media and technologies are extremely important for our communication and represent one of the main challenges to moving our brand forward." The CEO sees his company as well positioned for that: already in 2017, the Azimut Group received the "Russian Hospitality Award" for Best Hotel Developer.

Expansion continues

Even after the planned new openings this year, the expansion is set to continue. "We're still interested in the top locations in Russia; we're already present in most of the 15 cities with over 1 million inhabitants. But we're also considering smaller locations. And we want to grow in Eastern Europe, too. We're interested in gems like Bulgaria," says Neumann.

When asked whether he'll be cheering on the German team or the Russian team in the World Cup, though, the man, whose German friends jokingly call him "the Russian", is giving nothing away.

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