In 2005, the founders of citizenM realized that the modern hotel industry hadn’t changed in decades, despite the changing tastes and habits of the global traveler.
citizenM focused on the “mobile citizen” — the person who travels often and depends upon mobile technology. citizenM recognized that global travelers have a few essential conveniences and luxuries that they are willing to pay for, while other traditional amenities are not always necessary.
Based on these insights, the founders launched a hotel concept at Schiphol Airport in Amsterdam that minimized costs and maximized value for the mobile citizen with- out making it feel cheap. citizenM found a way to create more for less and was able to maintain high profit margins per room.
In 2019, the privately owned citizenM operated 20 hotels in 13 cities on three continents with an additional 10 hotels planned.
1. Eliminate most costly, desirable elements, yet not essential to customers
citizenM launches in Amsterdam in 2008. It removes the most costly elements of a high-end hotel, not essential to the mobile citizens it targets: no fine dining, no spa or sophisticated gym, no mini-bar, and no room service.
2. Reduce costs without making it feel cheap
citizenM drastically reduces construction and maintenance costs by building highly standardized 14-square-meter rooms in a room factory, which are then stacked like shipping containers to form the hotel. It reduces HR costs by working with small, cross-functional teams.
3. Increase value that customers care about at low cost
citizenM focuses on what really matters to mobile citizens: great mattresses, pillows, and sound-proof rooms. Its small staff has only one task: make customers happy. The lobby is vibrant, equipped with designer furniture, and 24-hour food and drinks.
4. Create new elements that boost value at less cost
CitizenM launches its own room factory to fuel low-cost expansion from Amsterdam to New York and Taipei. It streamlines cleaning and linens with new operations partners.102 Rooms are equipped with free broadband WiFi and movies-on-demand.
5. Reap benefits of creating more value at less cost
citizenM’s profitability per square meter is twice that of comparable upscale hotels. It achieves that by eliminating the most costly elements from the hotel business without making it feel cheap for its customer, the mobile citizen.