Case Study: Lebua: A Thai Luxury Hotel's Post-Pandemic Dilemmas

Jones Mathew, Sujata Khandai, Sandeep Puri Product Number: W25819

Publication Date: 2022-07-20

Product Type: Case

Source: Ivey

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Case Study below:

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W25819

LEBUA: A THAI LUXURY HOTEL'S POST-PANDEMIC DILEMMAS

Jones Mathew, Sujata Khandai, and Sandeep Puri wrote this case solely to provide material for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying information to protect confidentiality.

One January morning in 2022, Deepak Ohri, chief executive officer (CEO) of lebua Hotels & Resorts (lebua), sat down with key senior executives at one of the company's luxurious properties located in Bangkok to discuss the effects of the COVID-19 pandemic on the hospitality industry in general and on lebua in particular. He realized revival would be an uphill task, and he wanted to bring his core team up to speed on his recent thinking. Tourism and air travel across the globe had come to an abrupt halt during the lockdowns, and visitations had dropped drastically following the rapid spread of the virus. The hotel industry in Thailand, a world tourism hotspot visited by more tourists than any other Southeast Asian country in 2019was left paralyzed. Ohri had to find a way to revive his previously thriving business, but he faced a dilemma: should he expand his operations and revisit his marketing practices, or should he stick to what worked pre-pandemic and hope business would pick up again as the world returned to normal?

Once a creator of benchmarks throughout the region, lebuastruggled throughout 2020 and 2021 and was left grappling with unprecedented volatility from multiple angles. Ohri was facing issues related to employee retention, geographical brand expansion, the reclamation of customer trust, the maintenance of financial viability, and the redefining of luxury in a new context. As lebua stepped into its third decade of existence and Ohri and his team began reassessing its standing in the highly competitive Thai hotel industry, survival and revival were not the only concerns the team had to develop a plan to thrive in the coming decade and beyond. They discussed the factors behind their past successes, analyzing them anew and considering what needed to be bolstered and what needed to change in the post-pandemic periodMost of all, they wondered what primary challenges they would face and trade-offs they would have to make to remain distinctive.

THE LEBUA STORY

Ohri's journey through the hospitality sector started in the 1990s at some of India's well-known luxury hotels before he moved to Bangkok, Thailand, in 2001 to pursue an opportunity with the President Park Hotel. In 2003, he bought a hitherto dormant property, the lebua, which had been technically operational but was actually little more than a vacant building for the past six years. Immediately after joining, he focused on setting up a high-quality restaurant, an unorthodox decision.

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Ohri's conviction that the restaurant would change lebua'sfortunes came true. As he stated, With the establishment of just one restaurant, the whole building came to life. That was noteworthy because the giants of the hotel industry and most banks at that time did not believe that food and beverage [F&B] could be a key part of hospitality profitability."

Between approximately 2000 and 2020, lebua set many pioneering trends in Thailand's luxury boutique hotel space. The chain was known for its iconic Skybar and for hosting the highest New Year's Eve ball drop (266 metres) from its rooftop restaurant Sirocco. Its restaurants were even featured in the Hollywood movie The Hangover Part II. It had quickly built up a good reputation.

When lebua was faced with competitors from across Bangkok who reported better revenue per available room (RevPAR) Ohridefended his decisions by saying he had focused on three innovative strategies. First, the hotel's rooftop restaurant was only the fifth of its kind in the world; second, lebua had an "obsessive focus on simplicity over ostentatiousness" that manifested in even the tiniest aspect of the hotel; and third, "listening intently to the customer and learning from them" became the mantra of every lebua employee.

From a marketing perspective, the hotel did not have much of a footprint in social media, which was contrary to popular practice. Ohri explained that the approach was deliberate. He said that he believed in word-of-mouth publicity in which customers did "the talking rather than engaging in any firm-created messaging" Besides, he felt that a smaller social media footprint gave his company the freedom to pivot when it wanted to or when something went wrong. According to Ohri, "lebuafocused on exclusive partnerships and product access with world-renowned brands to create its brand image, rather than depending on social media presence."

In appreciation of lebua's many innovations, the brand was feted widely in the highly competitive hotel industry. In 2013, lebua at State Tower received Agoda.com's Gold Circle Award. In 2015, the hotel won the Best International Hotel for Business Travel in Thailand award at the annual Cond Nast Traveler Readers' Choice Awards. The hotel was also crowned the world's leading lifestyle and luxury all-suite hotel at the World Travel Awards in 2012, 2013, 2014, 2015, 2016, 2018, 2019 and 2021,5 maintaining its tight hold on the industry's top awards.

Using the TRIM Index, TNS, a global market research and market information company, rated lebua in the top per cent of companies in the world in terms of customer satisfaction. In less than two decades, the Southeast Asian brand had redefined luxury.

THE PANDEMIC'S IMPACT ON STRUCTURAL ISSUES

The damage to the hotel industry during the pandemic was primarily the consequence of health-related concerns, lockdowns, extreme restrictions on domestic and international travel, layoffs, and low per employee revenue output. Ohri felt that the post-pandemic challenges would be different and would be partially health related but largely economic. According to him, while the long-term fear looming over both

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guests and staff would be one of contracting the virus, the immediate struggles would be figuring out how to generate revenues from a low-occupancy base, how to address hiring concerns, and how to navigate the probable loss of investor confidence in the hotel industry as a whole.

He predicted a depressed RevPAR for the foreseeable future and was concerned that the tourist and business traveller segments would feel the structural impact for an extended period. Although lebua was marketed as a luxury hotel rather than a business accommodation, Ohri predicted it would feel the peripheral effects as meetings, incentives, conferences, events, and associated leisure extensions were unlikely to recover to pre-pandemic levels in the near future. He expected the rate of recovery for luxury hotels to be significantly lower than for economy hotels because the latter could acquire extended-stay guests and certain working class segments, such as travelling salespeople and truck drivers.

AFTER THE PANDEMIC, WOULD LUXURY STILL MEAN THE SAME THING?

Ohri was proud of lebua's reputation for offering complete privacy and had conceptualized its luxury hospitality service as the " creation and delivery of privacy." According to him, a guest's privacy held utmost value to the hotel because " it meant the world to a lebua guest." He claimed the word around Bangkok was that if anyone came to Thailand for business, they could stay at any hotel, but if they were on a private visit, lebuawas the only place to stay.

lebua conducted business on the premise that in a hyper-visible world, privacy was worth a lot to a guest and it was best communicated only through word of mouth. Despite functioning in a world of excessive overexposure across all forms of media, especially social media, lebua focused on building a cocoon of anonymity. Indeed , it took the practice so seriously that staff even discouraged customers of its rooftop restaurant and champagne bar from taking photographs , the reason being that photographers could inadvertently include people who did not want or like to have their picture taken.

Rajan Khurana , lebua's general manager of operations , explained that while the general masses like being seen in luxurious places, those already in the limelight would rather some much-needed respite from scrutiny.

lebua customized luxury for its customers by drawing on the idea that the perception of luxury was different for different people and cultures. For example, Americans considered luxury as something ostentatious, whereas Europeans perceived it as vintage or part of a legacy or heritage. Likewise, what is luxury in India could be normal in Japan. lebua ensured that its guests could enjoy their specific version of luxury. The questions on Ohri's mind were whether his team would have to reconceptualize and redesign luxury to cater to the post pandemic definition, and if so, how could they redesign the concept to attract post-pandemic customers.

THE EMPLOYEE CHALLENGE OF A POST-PANDEMIC WORLD

The hotel industry was always a people-intensive service, so when business came to a standstill because of the pandemic, layoffs became a necessity. In the Thai hospitality industry, long-staff tenure was a rarity, and high churn was normal. Moreover, a shortage of high-quality executives existed, as rival establishments often poached them. However, lebua's story was different.

Piangduan Lertsittikul, lebua's vice president of public relations and special projects, was a long-serving employee who had risen in the ranks. According to her, long- tenured staff were not uncommon at lebua. Those joining were either let go after the three-month probationary period or stayed long-term. She explained that lebua's remuneration package was better than the industry standard. While higher pay and perks like children's education motivated its employees to stay, the real driver of longevity was lebua's culture, which

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emphasized respecting its employees, empowering them, and supporting them to thrive in a performance based ecosystem that fostered creativity and original thinking within the brand's value systems.

In addition, employees shared the pride of working for a highly feted hospitality brand, which also happened to be the only hotel chain in the world to own two restaurants in Bangkok that had both been awarded two Michelin stars. The company had also received the Best Service Award in Michelin 2021. Additionally, lebua had a range of innovative practices and offerings as well as a CEO widely acknowledged as a trendsetter in luxury hospitality. The hotel followed an open-door policy and allowed direct contact between the CEO and all employees while maintaining a network of collaboration (chain of command) organizational structure (see Exhibit 1) that kept employee buy-in at a high level. Furthermore, not a single employee was let go during the pandemic period, which gave staff a sense of belonging.

However, this loyalty changed when lebua's employees witnessed widespread layoffs across other hotel chains in Thailand. They began to develop a sense of uncertainty and insecurity about their jobs. Although lebua maintained good relations with its staff and looked after them throughout the pandemic, its employees began leaving. At first, attrition occurred in small numbers as employees started leaving lebuaand the hotel industry in the initial stages of the pandemic as jobs were cut and tips dried up. By November 2021, nearly 600 employees had resigned and left the hospitality industry altogether. Practically overnight, nobody in Thailand wanted to work for the sector anymore.

In addition, national carrier Thai Airways declared bankruptcy in August 2020, resulting in the further curtailment of tourism in Thailand. Because of the cascading effect of three factors the pandemic, the departure of hospitality staff, and the grounding of Thai Airwayslebua suffered. After the pandemic regaining employees' trust was the key to getting back to business. Senior management wondered if onboarding highly trained Thai Airways business class air hostesses to replace some of lebua'semployees would be a practical solution. They wondered if luxury service could be delivered with fewer highly trained service staff and if they could anything more to retain long-serving employees.

FOCUSING ON HUMAN INTERACTIONS

lebua operated with the conviction that information technology (IT) had its benefits , but that its usefulness should not be overstated . Ohri felt that while IT was integral to the existence of the hospitality industry , it could never replace or become as important as the human exchanges in which delightful moments of truth were crafted for guests. He emphasized that the human touchpoints were what mattered most in any service operation blueprint. Specifically, when a luxury offering was marketed in the hospitality industry, he felt the main emphasis had to be on the human aspect of creating high-quality customer experiences.

While lebua used technology across a wide variety of service-process touchpoints the same way other major hospitality establishments did, it did not give tech a more dominant position than human interactions. At the same time, lebua staff were trained to depend on their IT team's smooth backstage operations, so much so that they were adept at using, updating, and successfully maintaining technology. In January 2022, Ohriasserted that lebua had not had a major systems failure in the last 18 years of its operations. He called it "a hygiene factor, suggesting that while the absence of IT can create problems, having it did not guarantee customer delight. He felt that IT systems were more protectors and enhancers of the luxurious hospitality experience and that integrating IT's ubiquitous presence with high levels of guest expectations in a luxury hotel setting" was essential. He felt that the purpose of IT was not so much to keep guests happy as to keep employees pleased.

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lebua had the latest IT systems in placeAmadeusCenturion , among others- as well as software suites and platforms that supported the processes in the service blueprint of any world-class hotel. However, the real magic of a luxury hospitality experience was usually delivered at the intersection of human interface and technological empowerment, with the former the more crucial element. This warm, humane, and friendly interactive marketing element led to lebua having customer loyalty figures of 85 per cent on average, flowing from a nearly 86 per cent "very good" or "excellent" customer review rating on Tripadvisor (see Exhibit 2). With health and social-distancing concerns and the COVID-driven necessity of keeping everything touch free , Ohri wondered if the human element of his strategy would have the same value as before and if guests would accept fewer human interactions and feel safer with no-contact technological interfaces.

BUILDING BRAND EQUITY

The house was divided on post-pandemic brand- building strategies. Expressing his views on lebua's challenges at the January 2022 meeting, Ohri said that brand equity in the luxury hospitality industry is built around promoting the destination, the service quality, the physical infrastructure and add-on services such as city tours, limousine pick-and-drops, casinos, and specially curated events. Besides advertising, influencer marketing has been the popular way to influence guests, but we have traditionally avoided it. This must continue." On the other hand, Khurana was in favour of newly emerging digital assets and platforms like non fungible tokens and the Metaverse, and he saw them as the future of luxury marketing , citing examples of marquee luxury fashion brands making their presences felt on these new frontiers. However, Ohri believed that those platforms were merely blips on the marketing radar and that luxury marketing, when it bounced back as surely it would, had to continue being people -focused and people-driven.

Ohri was expressing a wariness in leveraging the power of social media influencers. He believed that only genuine word of mouth from lebua's paying customers could be effective marketing. He called influencer marketing "loud, in your face, and smacking of desperation," and he was convinced that lebua was not that desperate for attention.

From a uniqueness perspective, lebua's primary property in Bangkok clearly created a set of distinct and salient features defining its identity. Online reviews validated lebua's brand identity as clearly being understood by consumers. In terms of performance and imagery , brand meaning was also clear (some impressed customers even shot and uploaded videos of the property). Online reviews displayed positive judgments and feelings for the brand. Given all this, Ohri was confident that the pre- pandemic customer satisfaction rate of 86 percent suggested that the lebua experience would still resonate with guests.

HOTEL-CHAIN EXPANSION DILEMMA

Even after nearly two decades in the industry, the existing brand equity of lebua's Bangkok property needed new expressions in other major tourist cities around the world. While lebua had a presence in a few cities in India and small presences in New Zealand and Germany, it had no significant property in any other major tourist hotspot to capitalize on the luxury tag it had created in Bangkok. This bothered the leadership team. While one group of company executives insisted that the chain expand its footprint immediately, others emphasized that it was first essential to consolidate its position in the home market after the pandemic. The expansion lobby felt that the brand could not be credibly referred to as a luxury chain unless it added more Bangkok-like properties, and the sooner it did so, the better. The pandemic had seen many properties, like

Amadeus was a global distribution system and IT business company used extensively in the airlines and tourism industries for searches , reservations , and pricing Centurion was a software used for maintenance and records management .

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the Rosewood Bangkok, go out of business.Some executives felt they were in an opportune time to acquire properties of that nature and expand at a relatively lower cost in other locations in Southeast Asia. But that strategy would have required addressing whether ownership and control would rest with lebuaor whether local partners aligned with the lebua's brand philosophy needed to be co-opted. It also raised questions about local investors' willingness to pump money into an industry that was cyclical and then badly debilitated by the pandemic. The group wondered what ownership structure would suit the post pandemic phase: sole owner/operator, majority owner, third-party management, or franchise. Finally, knowledge transfers regarding the lebua way of doing business would create other challenges.

Meanwhile, the status quo group argued against venturing out, reiterating that it was an inopportune time to launch an expansion bid even if distressed properties were up for sale. They felt that the work-from home scenario was anything but clear even though the pandemic was showing signs of ebbing. Future uncertainty was still high. The group felt that a return to former levels of operation and getting by with fewer staff, tougher customer acquisition issues, and strict cash-flow management should be the key focus areas for at least the next eighteen months.

Caught between the two pressure groups in his own senior leadership team, Ohri was in a dilemma.

INNOVATION IN THE HOTEL INDUSTRY

The hotel industry often borrowed from the airline industry's best practices. Airlines were the real innovators be that measured by the basic success metric of RevPAR, the sous-vide technique of cooking that the industry pioneered to keep food fresh at thirty thousand feet, innovations surrounding computerized check-ins, GPS Amadeus codes, TVs in rooms, attached bathrooms, or hire-and-fire human resource policies.

Ohri felt many luxury hotel brands mistook ostentatiousness for innovation and often went overboard to impress guests by investing heavily in decorating rooms, lobbies, and landscaping instead of restaurants and F&B. lebua, on the other hand, had innovated in a major way with its F &B vertical. Simplicity became its signature, and F&B was where it laid its largest bets. According to Ohri, simplicity was not about coming to the restaurant or the lobby in flip-flops or casuals it was about exclusivity . He felt that simplicity was the most difficult thing for the ostentatious brands to copy.

lebua prided itself on providing a $25,000 -per-head luxury dinner with 40 guests in a disarmingly simple restaurant . While it could be assumed that those paying that kind of money would expect ultimate royalty, that was actually not the case with lebua's guests . Ohri realized that they could afford and, indeed ,owned better chandeliers " and did not really visit his hotel to see expensive dcor items; instead, they wanted simplicity and exclusivity.

He felt he would rather seek the kind of innovation that would appeal to that desire for simplicity and exclusivity.

Another innovation that lebua adopted was eliminating the training and development and marketing departments , replacing them with the idea of "listening to the customer ." The people at lebua took this ethic very seriously . Relating an incident to explain and endorse this decision, Ohri said:

Way back in the early 2000s, we had some guests from a leading logistics company for dinner at our rooftop restaurant . It rained that day, and they were drenched . They left in a hurry, leaving an unpaid bill. However , they were back the next day to pay up and have dinner again on two

Rosewood Bangkok was a 63-year -old luxury hotel under the Rende Ploenchit Hotel Company Limited, belonging to the Shinawatra family It announced its temporary closure after a TB 396 million (around US11.2 million ) loss in 2019 due to the pandemic (Pornpailin Chulapan , Covid Spews Poison ! Aim-Pinthongtha Posts IG Informing the Closure of the Luxury Hotel Rosewood Bangkok , Bangkok Biz News, August 27, 2021,

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conditions one, that we plant umbrellas, and two, that Kenya launch "rain check vouchers" (no charge for food if it rained). I implemented both suggestions, and I saw that 99 per cent of guests insisted on paying despite the discomfort caused by unexpected rain. I learned that if one really listened to customers carefully, one didn't need much else. Most industry colleagues did not believe me that there were many redundant departments in a hotel.

lebua worked closely with TNS to align customer satisfaction with employee satisfaction. Every customer became a training opportunity for lebua. Information was culled from every customer visit in a scientific manner and used for training purposes.

lebua attempted and succeeded at innovations in terms of service processes, human resources and training practices, F&B experimentations, better use of space, and the redefining of luxury hospitality. However, the bar needed to be constantly raised, as customers quickly got tired of a given level of service. The needs for variety and novelty were high among luxury customers, especially those returning to travel after the pandemic Ohri wondered if lebua was prepared with innovations that really mattered, as survival was at stake.

FINANCIAL WELLNESS

Quite a few five-star hotels the Oriental Mandarin, Shangri-la, Le Meridien , Novotel , Siam Hotel, Royal Orchid Sheraton, Peninsula , and Capella Bangkok lined the Chao Phraya River in Bangkok . lebua at State Towers was in the same district and had achieved a respectable status against all odds.

It was important that the experiences crafted for guests at lebuaalso returned good financial results. Many experts believed that all things considered equal, luxury hotels needed to maintain occupancy rates at 1.5-2 times that of economy hotels. In all hotels, revenue was a function of the daily average rate, number of rooms, occupancy, and F&B. Costs fell under three main categories: variable (depending on revenues) semi-fixed, and fixed. During the pandemic, lebua's financials were managed reasonably well given the tough circumstances (see Exhibit 3).

Major competing luxury hotel chains found it difficult to manage cash flows and profitability during the pandemic, but lebua managed operations with more intelligence than any other large hotel company, both international and domestic, in Bangkok . While most hotels incurred losses to the tune of 600 per cent of their previous year's profits, lebua managed to contain the damage more efficiently (see Exhibit 4). The famous luxury Dhara Dhevi Hotel in Chiang Mai Thailand, had to shut down its operation in November 2020 after being struck by the COVID-19 outbreak. Nevertheless, Ohri was confident that luxury hotels would make a strong comeback even if the journey ahead was likely to be tougher than that of non-luxury hotels.

When other important hospitality industry parameters , such as the Occupancy Penetration Index, marketing cost per booking, direct revenue ratio (hotel)and direct revenue ratio (restaurant), were applied to a base of 357 rooms across the State Tower and Tower Club properties , lebua showed good outcomes (see Exhibit 5) Further, RevPAR performance metrics were satisfactory despite intense competition from major competitor brands in the city (see Exhibit 6). lebua's financial auditors , Deloitte LLC had given the company a clean bill of health in terms of quality of carnings (see Exhibit 7)Ohri wanted to go from surviving to financially thriving and wondered what short- and long-term strategies would help him achieve that goal.

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BRAND CONSISTENCY THROUGH PRODUCT MANAGEMENT

One of the key features of the lebua brand was its approach to maintaining brand consistency across its multiple properties around the world. It was a challenge to ensure that the brand DNA remained the same across its two hotels in Bangkok, one high-end lodge in New Zealand, three hotels in India, and one restaurant in Germany. The challenge was solved by distilling the essence of the brand consistency strategy as follows:

We have a policy of product, not of image. So first of all, we create product which defines what the property would be. Second, we create processes around the product, service processes. Those service processes define how these products will be sold to the people. So these become non negotiable. Both these things are controlled. So 80 per cent of the DNA is matched. [The] rest of the 20 per cent is about practice. There is a lebua template for operating a hotel or restaurant. The template is the consistency part of the lebua brandlebua also has only one brand, unlike its competitors, which have a portfolio of brands, and we take full advantage of that.

The questions after the pandemic were what needed to be done to ensure that the existing brand equity lebua enjoyed continued to remain a differentiator and what changes , if any, were needed to honour the brand promise, attitude , and personality and align it with the new realities of changes in consumer behaviour.

COBRANDING WITH EXCLUSIVE PARTNERS

Pernod Ricard ( Pernod ) was one of lebua's most exclusive partners . Ohri considered the partnership unique in that Pernod had created a signature bubbly for exclusive sale at lebua for four yearssomething the wine and spirits seller had never done for any hospitality brand in its 220 -year history.

lebua's success in achieving very high Pernod sales in its Bangkok establishment earned Ohri a page in the company's annual report, which became the first and only page dedicated to an individual hotelier. By 2022, the deep and solid partnership had lasted nearly a decade.

In terms of high performance expectations , lebua never compromised its standards for any brand. It once terminated its relationship with a leading German luxury automobile brand because of its failure to create customer delight. lebua then chose BMW as a new partner because the company aligned better with the hotel's idea of excellent customer experience.

Similarly, Tajima , the iconic Japanese crystal company , was the chosen champagne glass brand. According to Ohri, despite having world-famous brands as exclusive partners or suppliers , unlike other luxury hotel brands , lebua was not obsessed with cobranded items or marquee brand names to boost its luxury positioning Instead , it focused 90 per cent of its energy on F& B, toiletries , beverages , food-ingredient sourcing , and cooking stylesall of which really mattered to its guests.

The lebua philosophy of delivering luxury services by collaborating with iconic companies as sources of secondary brand association had worked well before the pandemic, but there was no certainty that the same strategy would be applicable post-pandemic. Ohri's team needed to assess what had to be done to enhance the benefits of such collaborations in the new business setting.

LEBUA'S BRAND MANTRA

"Privacy, Simplicity, Service" had been lebua's brand mantra and had informed all decisions at the much-awarded hotel. The al fresco restaurant was a testimony to simplicity, the housekeeping offered privacy, and

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the bars and rooms delivered luxury service. Different hotel services had all three aspects of the mantra in customized mixes, and those aspects permeated every service, whether the operations team was planning a process change, the F&B team was creating a new dish for one of the seven bars and restaurants, the 24-7 in suite dining facility was serving customers at all hours, or the round-the-clock housekeeping team decided to change the linen quality in the hotel's 357 suites everything was put through the brand mantra to check for alignment before proceeding. This kept the employees on target as they delivered lebua's promise and brand essence to all its guests. According to Ohri,

The brand mantra has been instrumental in each of our employees support staff and managerial executivesfocusing on every guest through the lens of the three core aspects of what we stand for, our core values. It was easy, crystal clear, and easily communicated internally. It truly helped us to be single-minded in caring for our customers.

Because the market changed quite a bit after the pandemic, the team had to decide whether redesigning the brand mantra would be a way of helping staff and the hotel itself realign with the changing needs of the market.

THE WAY FORWARD

The pandemic had thrown a few major challenges at the hospitality industry in general, but luxury hotels had to bear higher costs because of their staggering overheads and the drying up of high-paying customers. The brainstorming session between Ohri and his senior management team raised more questions than answers: Would the rate of recovery of high-paying customers be too slow? Would luxury still mean the same things to customers post-pandemic? If not, how would lebua go about redesigning itself? Would it be able to provide the same pre-pandemic service with fewer but more-highly skilled people and manage to retain its long-serving employees? Would a human touch have the same value in the pandemic-imposed tech-driven and touch-free environment, and would customer satisfaction remain the same? Would it make more sense to focus on consolidation or to focus on acquisition and expansion post-pandemic? Would there be room for innovation when survival was at stake? Would thriving financially require short- and long-term strategies that would not only avert closure, but also help the hotel race ahead of competition? Would lebuaneed to rethink its brand identity to overcome post-pandemic challenges? Would it need to reassess how it leveraged its exclusive cobranding partnerships? Would it need to redesign its brand mantra? Ohri and his team had to decide how to address each of these questions in the absence of a marketing team and a training and development department as well as alongside customerschanged perceptions. The meeting on that January morning promised to stretch long into the day.

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EXHIBIT 1: LEBUA'S ORGANIZATION CHART

Chief Executive Officer-

General Manager Hotel Operation & Commerce, Director of Sales, Director of Sales Catering, Asst. Director of Commerce, Room Divisions Manager, Front Office Manager, Chief Engineer, IT Manager, Chief Security.

Vice President - Public Relations and Special Projects, PR & Special Projects Manager.

Director of Finance, Finance Manager, Material Manager (Consultant), Cost Controller, Credit Manager.

Director of Bars: ( Senior ) Bar Manager Alfresco 64, Distil, Flute Bar, lebua No.3, Pink, Sky Bar.

Director of Restaurants: General Manager Restaurant, Chef's Table, Mezzaluna. ( Senior ) Restaurant Manager: Breeze, Caf Mozu & Tower Club, Room Service, Sirocco, Banquett, Hostess Manager

Chief de Cuisine: Breeze, Caf Mozu, Chef's Table, Mezzaluna, Sirocco. Pastry Chef. Chief Steward.

Director Human Resources Breeze

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EXHIBIT 2: LEBUA AT STATE TOWER CUSTOMER REVIEWS ON TRIPADVISOR

Tripadvisor

Lebua At State Tower

About

4.5 Excellent

9,065 reviews

#193 of 1,489 hotels in Bangkok.

4.5 Location

4.5 Cleaniness

4.5 Service

4.5 Value

Traveller's Choice

Property amenities

Free parking

Pool

Bar / lounge

Nightclub / DJ

Free High Speed Internet (WiFi)

Fitness Centre with Gym / Workout Room

Evening entertainment

Babysitting

EXHIBIT 3: LEBUA'S FINANCIAL PERFORMANCE 2018-2020 ($ in millions)

F&B revenue. 25.36. 25.41. 8.59

Hotel revenue. 18.41. 18.04. 3.91

Total revenue (post-adjustments). 43.52. 43.25. 12.54.

Consolidated EBITDA. 10.88. 11.69. -2.91

Note: EBITDA Earnings before interest, taxes, depreciation, and amortization Source : Provided by company .

EXHIBIT 4: COMPARATIVE FINANCIAL ANALYSIS OF LEBUA WITH SELECT COMPETITORS

Hotel Brand Name EBITDA ( in millions )

2020. 2019.

Hilton Worldwide ($924). $1,244

Accor Worldwide ($2,240). $520

Minor Group ($800). $415

lebua Hotels & Resorts $2.9. $11.7

Note: EBITDA Earnings before interest, taxes, depreciation, and amortization Source : Provided by company.

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EXHIBIT 5: LEBUA'S PERFORMANCE ON KEY HOSPITALITY METRICS

Total available rooms at lebua State Tower 136 Total available rooms at lebua Tower Club 221 Total available rooms 357

Marketing or occupancy penetration index 110%

Marketing cost per booking (hotels) 20%

Marketing cost per booking (restaurants) 10%

Direct revenue ratio (hotels; % of total bookings) 8%

Direct revenue ratio (restaurants; % of total bookings) 90%

Source: Provided by company.

EXHIBIT 6: LEBUA'S REVPAR PERFORMANCE ON KEY HOSPITALITY METRICS (US$)

Department Revenue 2017 2018 2019

Rooms: # 357. 357. 357

Days available: Days 365. 365. 365

Average daily revenue: US$ 134.9 139.5 135.2

Occupancy: %. 80.9%. 80.6%. 82.2%

RevPAR: US$ 109.2 112.5 111.1

Source: Provided by company.

EXHIBIT 7: LEBUA'S QUALITY OF EARNING ANALYSIS BY DELOITTE

lebua Net Dome Revenue by Outlet (in Millions of US$ )

FINANCIAL YEAR:

FY14 FY15 FY16 FY17 FY18 CAGR

Restaurants 10.3. 10.4. 10.6. 10.4. 11.5. 2.8%

Sirocco 5.8. 5.5. 5.9. 5.6. 5.8. 0.2%

Breeze 3.2. 3.4. 3.3. 3.3. 3.1. -0.7%

Mezzaluna 1.3. 1.5. 1.5. 1.5. 2.5. 17.8%

Bars 6.4. 8.1. 9.3 10.8. 10.9 14.1%

Distil 3.0. 3.3. 3.2. 3.1. 3.0. 0.0%

Sky Bar 3.3. 3.0. 2.9. 3.1. 2.9 -2.9%

Alfresco 64 1.9. 2.5. n/a

Flute Bar. 1.7. 2.3. 2.2 2.2 n/a

lebua No.3 0.2. n/a

LOBBY BAR 0.1. 0.01

Vantage Point 0.7. 0.4. n/a

Others 0.7. 1.1. 0.8. 0.6. 0.189 -29.0%

Banquet 0.4. 0.6. 0.5. 0.3. 0.189 -17.6%

The State Room 0.3 0.4 0.3 0.2. -100.0%

Net dome revenue

17.4 19.7 20.8 21.8 22.5 6.6%

Note: CAGR = compound annual growth rate Source : Provided by company .