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25 July, 2018

“I clearly see the Airbnb model being a disrupter” Karma Group founder talks expansion

We caught up with John Spence, chairman and founder of the Karma Group to find out more about their plans for expansion and what makes the business tick.

Travel Weekly: What keeps you up at night?

John Spence: Definitely the opportunity for expansion. Over the last few months, Karma has grown enormously.

We’re currently negotiating a whole raft of new acquisitions; anywhere from 5 to 30 new properties are available to us in many incredible destinations so one of our challenges is deciding which opportunities to take, and from a strategic point of view, we need to decide which will prove most successful.

TW: What is at the top of your to-do list?

JS: To keep building the number of resorts that we have in what I call “branded destinations”. We’ve recently seen a shift in the market whereby are now appealing to Asia Pacific based tourists coming to Europe rather than the other way around. We can now buy assets cheaply here in Europe and renovate them at a good price.

So the top of the to-do list is to continue this strategy and to keenly find new assets here in Europe.

Slightly parallel to this is get into the Caribbean. We’re looking at Angola, the Grenadines and at doing a deal which is a combination of land-based accommodation and water-based experiences on catamarans and boats.

We’re also very keen on expanding our series of Rock Hotels in London and possibly New York, Miami and Los Angeles.

TW: What do you see as the biggest disrupter or threat to the global travel industry right now?

JS: From a “hotel model” perspective, I clearly see the Airbnb model being a disrupter.

When I was teaching at Yale University we spoke to students about how they booked their holidays and the vast majority booked through Airbnb rather than traditional hotel channels.

However, when questioned, the majority said they had experienced issues and were concerned that there was no recourse on those problems because they had booked through the app.

To be candid, it doesn’t really affect our business as we’re more of a kind of private members club than a standard hotel model.

TW: What do you see as the biggest opportunity in the industry right now?

JS: The biggest opportunity for us at Karma Group is globalization.

The world is now a village and it’s becoming more so every day. We as a company have always had a global mindset, so we have always found ourselves one step ahead of that opportunity.

TW: What is the purpose and personality of the “Karma” brand and how do you, your staff and/or your guests live and breathe these values?

JS: Karma very much has a personality. We often say that our resorts are unified by the Karma philosophy. This philosophy is loosely driven by the concept of you get what you give back.

Our brand personality is captured at every touchpoint in our hotels from our spas – offering not only normal treatments but also wild, funky white witch, reiki and holistic programs – to our kids clubs, vinyl rooms and beach clubs.

Philanthropy is also a major focus for us.

An example is where we run an event in India called Camp Royal, where we take about 200 kids to one of our resorts and we shut it for four days, the kids become the guests and our normal guests become the hotel staff. Guests love to come and help the children, play with them, serve them and truly give something back.

TW: What’s the one thing nobody at work would know about you/what would surprise them?

JS: I really did start at the bottom of this industry. I was the annoying kid on the beach in 1984 who was hustling people to attend sales presentations.

I also spend a lot of time with my staff and I’m very involved in the day to day running on the business. They know that I’m very keen on expansion and that I’m very driven.

TW: What do you do to relax/blow off steam?

JS: The way I blow off steam is definitely working out. And in fact, something that most people don’t know about me is that my absolutely favourite music to work out to is trance music. Armin Van Buren has a Spotify radio channel of heavy trance that I play on my Beats headphones at an ear-splitting level.

So my perfect day is waking early and doing a savage workout, having a morning of positive, worthwhile and productive meetings, having a beautiful lunch with good red wine and then an early night.

Most days I get to do this so I feel very blessed and fortunate.

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Email the Travel Weekly team at traveldesk@travelweekly.com.au

John Spence the karma group