The all-inclusive concept is not what it used to be

Gone are the days when all-inclusive vacations meant over-indulging at the swim-up bar, dining at the same buffet for seven days straight and sleeping in sub-par accommodations for the sake of some time in the sun.

All of a sudden, "luxury" is part of the all-inclusive conversation, which is a recent development that is not only inspiring mega resort development across Mexico and the Caribbean, but also attracting a new demographic of traveller to this type of vacation.

Hyatt is among the players setting new standards in this segment as the first global legacy brand to try its hand in the all-inclusive space. The initiative is a joint venture with Playa Hotels and Resorts, now with five properties under the Hyatt Ziva and Zilara brands - family and adults-only resorts respectively, primarily in Mexico but most recently, also opened in Jamaica.

"Back in the day, 'all-inclusive' was all about the three-star concept," said Kevin Froemming, Playa's chief marketing officer and executive vice-president. "We're bringing in a higher caliber of  guests willing to pay more money and they want to experience the destination, which I think is the biggest change."

News of Hyatt's foray into the all-inclusive market was announced in August 2013, touting "The evolution of all-inclusive" as its tagline. What that means for guest experience is unique offerings across the board such as access to 24-hour room service for every room regardless of category, state of the art amenities, plus swanky swim-up suites and fire pits throughout the properties. The atmosphere is upscale yet laid-back, with restaurant choices that run the gamut of traditional local cuisine to French or Brazilian options.

Whether they are riding a trend or leading it is up for debate, but a look at how other established businesses are attempting to tap into higher-end clientele will demonstrate the shift in mentality about the all-inclusive concept; for example, AMResorts' "Unlimited luxury" slogan for its adult-only brands or Sandals' "luxury all-included vacations."

Alex Stadlin, CEO of Playa Resorts Management, said that he and his fellow executives (Bruce Wardinski, chairman & CEO Playa Hotels & Resorts and Carlos Cabrera, senior vice-president of Hyatt's all-inclusive operations) have never worked in the all-inclusive realm before, but explained how making accomodations available that satisfy higher-end clientele is expanding the market potential.

"I couldn't believe that the big, international hotel chains weren't in this space," he said. "All-inclusive is the only segment on the international hotel market where the big players aren't. Hyatt is the first one to get into this field."

That said, he anticipates other major brands to follow suit, though noted, "We think we're with the best partner and we have a great head-start."

Part of the strategy is engaging prior Hyatt guests, more than 50 per cent of whom have never experienced an all-inclusive vacation. With that in mind, Froemming said, "We're not necessarily just looking to shift business away from our competitors; we're looking to grow that market, which we believe is becoming much more mainstream."

"In the Caribbean, the all-inclusive concept works really well," he explained. "This is the way of the future because the concept of all-inclusive can be five-star but still a great value proposition for guests."