Mr & Mrs Smith’s grand adventure: How a humble weekend getaway led to a burgeoning travel empire
Tuesday, August 13, 2013/
For just one day, 10 years ago, in one London bookstore, the original Mr & Mrs Smith: Hotel Collection UK/Ireland outsold JK Rowling’s infinitely successful fantasy, Harry Potter.
“Waterstones in Piccadilly, that was our claim to fame, move over JK!” says James Lohan, co-founder and chief executive officer of the global boutique and luxury travel booking business, Mr & Mrs Smith.
In 2003, when James and his now wife and business partner, Tamara, were dating, they went on a weekend trip to what they thought would be a stylish, boutique hotel. It had been recommended in a general travel guide.
However, the hotel was not the “boutique” experience they expected.
“Ten years ago luxury was defined very differently to the way luxury is defined now,” says Lohan. “In those days it was very much gold tap luxury, very formal service, very chintzy décor.”
They wanted to spend their weekend breaks in places that were unique, stylish and inspiring, but also relaxing rather than uptight.
Over a meal of meatballs and mash in a Melbourne-laneway restaurant, the UK-based couple recall that they wondered why there was no quality guide to boutique and luxury travel available.
“The internet was still very new, people were still worried about booking their flights on the internet, it was at the very start of that movement to go online,” Tamara says. “The hoteliers were not marketeers, they know how to run a good hotel, but not how to find the global audience that they are after.”
No more “crappy weekends”
Despite having no experience as publishers – James worked in event management and running nightclubs and Tamara in marketing – they decided to create their own book.
“We thought we’ll write a guidebook about it, then I’ll stop taking Tamara away for crappy weekends, I’ll romance her, we’ll get married and have children, and all because of a good book,” James jokes.
The couple drafted their idea – a beautifully designed book featuring a hand-picked selection of 41 of the UK’s best boutique and luxury hotels, with unique imagery by their own photographers, and professional reviews written by anonymous guests.
With encouragement from family and friends, they pitched it to publishers.
But no one took it up.
“They turned us down for various reasons, they hated the stock of paper that we wanted to use, a rough stock rather than glossy stock, which is what they think luxury is,” James says. “We put a membership card in the book, and they said no, you can’t do that – they hated it.”
Rather than despair, the fledgling publishers decided to print it themselves, raising £180,000 through family and friends, and re-mortgaging their house to fund it. “We were just so bloody minded,” James says.
The next challenge was finding a distribution network, but they found that without the backing of a known publisher, booksellers wouldn’t meet with them.
“We found the last independent distributor – they took us on and they said ‘you’ll sell 5000 copies, in a year’, and we said, really? We’ll be buying a caravan, losing our friends and our family probably won’t speak to us!” Tamara says.
The distributor, it turns out, was wrong.
“We sold 20,000 books in the first three months,” James recalls. “We were so certain we had something special that people needed, and we kept that always front and centre when we had the dark times and the challenging times.”
From guidebook to travel service
As its popularity grew, the entrepreneurial duo became more ambitious. They decided to expand their business much further than the guidebook to become a specialised service for booking boutique and luxury hotels around the world.
“The lightbulb moment was when we were away on one of our weekends…the hotelier said that 50% of his weekend business was from the Mr & Mrs Smith card (inside the book),” James says.
By presenting the card, visitors received specials such as a bottle of champagne, a later check-out time or perhaps a free cocktail at the hotel bar.
“And we thought, wow, we need to get some of that business – we knew the book was great for building a brand but we wouldn’t get a scalable business from it.”
They set about raising approximately £2 million through family and business people, then opened offices in Melbourne and New York to facilitate communication with hotels across the world.
In 2005 they went online with mrandmrssmith.com, whilst grappling with technology platforms, relationship-building, customer service and marketing. Then in 2006 they established an in-house reservations team, and became the middle-man between the hotels and consumers.
“We are bringing in rates from 900 hotels live around the world, in different currencies – it is a real challenge…we need to have customers talk to us offline…we are acting as a travel agent at the same time,” James says.
Across three head office locations, around 30 employees are available to answer calls to customers. There are also marketing professionals, finance experts and travel writers in the growing team.
The business now generates around £40 million ($A68m) in bookings per annum.
James explains that their success largely comes from building a great reputation and relying on word of mouth, as travel is something people talk about in detail to their friends.
They also have targeted approaches to marketing, such as investing in search engine optimisation, public relations and strategic partnerships. These range from large-scale affiliations with British Airways, to smaller scale associations with beauty brand Aesop.
The business got a celebrity boost when Brad Pitt and Angelina Jolie starred in the film bearing the same name. James jokes the association means people expect the Hollywood couple to turn up to hotels, not he and Tamara.
“You need three or four touch points before people start consuming, such as hearing on radio, a friend’s recommendation, you’ll read an article, then you might see it in Google, and if you see it in different areas of your life, that is when people start to believe it,” James says.
Keeping watch on social media
As chief technology officer, Tamara invests time in tracking trends, keeping an eye on what people are searching for and booking. Social networking is integral to their approach, but she stresses it is not a silver bullet. She thinks that while the business needs to appear in each social media space, it is best to invest time and money where you are showing the most return for your business.
James explains that some social media ideas just don’t take off.
“We tried a Facebook ‘hint’ campaign, where we had a ‘send me away’ hint that you could send to a friend or partner. We thought it would be super viral…but it was not as successful as we thought,” he says.
Now celebrating 10 years since launching, and with over 75,000 members on board and receiving over a million visitors to the site each month, James and Tamara have just as much drive as when they began.
In 2012 they raised over £2 million pounds through crowd-funding, offering customers the option to invest in the company by purchasing bonds. Inspired by their foray into parenthood, they have a new division, Smith & Family, launching in the UK soon. Like Mr & Mr Smith, it will specialise in hotel recommendations and bookings, but for child-friendly hotels.
Also in the pipeline is a homewares range, At Home with Mr & Mrs Smith, with bed linen and interiors. A selection of boutique paints has been created, themed in city, coastal and country ranges. For sale online, the paints will come with a special paint testing ‘I-patch’ that can be moved from wall to wall.
They also have their first international hotel awards launching later this year, albeit with a Mr & Mrs Smith twist. Categories such as ‘Hottest Hotel Bar’ will uphold the glam-factor associated with the brand.
“We want to be a fully-rounded business, not just a one-dimensional content curator,” James says.
Tamara agrees, but admits it’s tough as a business owner with a family to get the work-life balance right, particularly as they are travelling at least a quarter of the year.
“I constantly feel guilty,” she says of the juggle. “The good thing is that work hours can be more on your own terms.”
Rio, Ibiza, Amalfi – living the dream
The blessing of their business is the amazing travel opportunities and the fascinating people they meet. Rio, Ibiza and the Amalfi Coast are among their favourite destinations, but they also love Melbourne for its food and coffee culture. Next stop after visiting the Melbourne office was a retreat in Bali – but always with one eye on finding hotels for the business.
They hope that the 10 years of self-belief, hard work and risks will enable them to keep Mr & Mrs Smith thriving for years to come.
“The foundation of what we build, I hope, is a company that will still be here in 50 years,” James says.
Forget marketing, the secret to business success is being well-liked Ian Whitworth Scene Change co-founder
Why brick-and-mortar will drive e-commerce by turning stores into distribution centres Brenton Gill Radaro managing director
Play, refine and grow: How I started a successful shoe business with just $100 Sarah Nally Sienna Baby founder
How we created an engaging online course with a 91% completion rate Emma Green Your CEO Mentor co-founder
Flexible working is all the rage, so here are six tips to help you get started Alison Michalk Quiip founder
Four tips for playing the long game in business, from Victoria's Small Business Woman of the Year Fiona White Own Body founder