The Daily Telegraph: February 2008

For the gen on where to spend a weekend in the UK, James Lohan's guide has become a must.  Now for the US, he tells Philip Smith.

Having seen revenues double last year, James Lohan is now looking to turn a profit at Spy Publishing, the firm behind the boutique hotel guide Mr & Mrs Smith.  It will be the first time in its history that the London-based business has been in the black.

Such is the demand in the UK for his collected views of chic and unique owner-run hotels that he thinks there is a far bigger market ready for the taking – the US.

But he's not sure how.  "We have got the UK operation running pretty well," he said.  "Our big dilemma is how to crack the US."

It's seen as a must-do move for the Mr & Mrs Smith brand.  In the four years since its launch, Mr & Mrs Smith has grown from a modest collection of 41 hotels in the UK and Ireland to now include a membership base of 50,000, further books, a website containing 350 individually vetted hotels from around the world and an online booking service.  It even sells CDs specifically compiled by ex-DJ and club owner Lohan to help set the scene as its thirty-something affluent customers head off for that weekend break.

Lohan and his then girlfriend – now wife – Tamara Heber Percy came up with the idea of reviewing small hotels, pubs and B&Bs after staying in a hotel that failed to live up to its billing.  With £180,000 raised from savings and friends, the couple, who remain majority owners, self-published their first collection as a coffee-table book.

The guides, said Lohan, aim to give guests the insider information: the best room, best table, where to go and what to see.  "The premise is that it's the kind of information a good friend would tell you – the little pub nearby that serves a great Sunday lunch, and to book two weeks beforehand or you won't get a table.  That sort of thing.

"These hotels are not pretentious and super luxury," said Lohan.  "But realistically the lowest price you would expect to pay is £100 a night.  I don't believe they can deliver our type of experience for less than that."

Mr & Mrs Smith is, said Lohan, 37, a brand for the people.  The people – the target market – are affluent and aged, on average, 35.  "But we do have some granny Smiths – our oldest member is 75."

It was after Spy Publishing secured a £2m institutionally backed investment to launch its online service, allowing direct accommodation bookings and links to affiliated deals, that the firm changed to a more scalable business model.  Going online also allowed it to start a membership programme, free via a card that comes with the books; it is a way for hotels to track the referrals.  By upgrading – the top level costs £250 a year – members can get extra services such as a travel booking.

Last year, Spy's £4.5m revenue was driven by four streams: selling the books (which retail for around £20); membership fees; payment by the hotels; and commission generated by bookings.  The biggest cost is the salary bill for its 30 staff.

"We do charge hotels to be included," said Lohan.  "The fee is subject to the hotel being invited to be included and no one can buy their way in.  A hotel has to have something a bit magic.  A Mr & Mrs Smith weekend is about romance but it's also the allure of sexiness and mischief."  Hence the name.

"In the US Mr & Mrs Smith has different connotations – it means an average suburban couple.  But we won't be changing the brand name, we are hoping they will like the quintessentially British idea of a dirty weekend.  After all, why do people go away for the weekend?  It's not to knit and write letters."

The US launch will consist of a dedicated book, listing the best of the Smith-approved global hotels.  There will also be a US-friendly website.  It has its distributors sorted.  "In five years we want to be the top boutique hotel collection in the US, but we are going to need help selling the Mr & Mrs Smith concept."  He is looking for an agency to market the brand, and will eventually open a US office.  But growth, constrained by funding, will have to be slow and organic, he said.

Plans for the UK include a recently launched book with must-know info on weekend events, everything from the UK social season such as the Henley Regatta and Royal Ascot.  "It tells you where to park, what to wear and where to stay.  We can even get you tickets."

Lohan is also compiling a Smith with Friends range, listing self-catering chalets, cottages and chateaux.  "We're finding a lot of people want to go away as a group."

The Lohans are also launching a Smith & Kids collection of family-friendly hotels and a loyalty scheme.  "We don't want to be thought of simply as coffee-table book publishers.  We want people to use us for bookings, not just research.

"The beauty of this brand is that it can develop into so many things," said Lohan.  "We are talking of opening our own Smith hotel."