The Memory of Bygone Days at the Ritz

Last night, I attended a fundraiser to support the Vincent Memorial Hospital, a specialized unit for women’s care at Massachusetts General Hospital in Boston. The event has been held annually since 1892, and revolves around a variety show performed by members of the Vincent Club, a private women’s organization founded to support the hospital.

The theme of the show this year was a retrospective of Vincent Club performances over the past century. That alone might be interesting to scholars of heritage, but the really instructive moment occurred during a song-and-dance routine about changes in Boston over the years. An entire verse was devoted to the demise of the former Ritz-Carlton Hotel, which operated at the corner of Arlington Street and Newbury Street from 1927 to 2007. During this time, the Ritz became the leading hotel in the city. Its bar and restaurants were patronized by generations of affluent Bostonians. This property also served as the spiritual and legal basis for the renaissance of the historic Ritz-Carlton brand as a global hotel chain after 1983.

The current Ritz-Carlton Hotel in Boston is a new building, located across Boston Common on Avery Street, which opened in 2001. Both hotels continued to operate under the Ritz brand during the period 2001 to 2007. However, the new Ritz was always regarded disdainfully as an interloper or poseur by natives.

The original building still exists. It was purchased by a subsidiary of the Tata Group and has been operated since 2007 as part of Taj Hotels, a respected international chain in the luxury segment. However, the Taj has never captured the hearts of Bostonians and its financial performance has reportedly been disappointing. The underlying real estate was sold again this year, apparently for less than its purchase price a decade ago, although the hotel continues to operate under the Taj brand and management. The Taj experiment in Boston does not seem to have worked.

Why would this be so? If the original value proposition was a combination of brand and management, then consumers would have transferred their allegiance to the new Ritz building. If the original value proposition was a combination of location and architectural character, then consumers would have transferred their allegiance to the Taj management group. Neither of these occurred.

My answer is that the old Ritz was transformed over decades of use into a beloved cultural institution, which was inseparable from the collective identity of Bostonians, in manner similar to the Red Sox baseball team or the USS Constitution naval ship. It was not merely a provider of hospitality services, but rather was a symbol of who we considered ourselves to be in an existential sense. Detaching the brand from the building was the social equivalent of a divorce or a death in the family. The old Ritz is now mourned in the annals of Boston history, emerging recurrently in discussions at cocktail parties and even stage productions a decade later.

This illustrates a theory that I discuss frequently in my academic work on the concept of brand heritage. The history of a brand is often interwoven with personal and cultural narratives that have deep resonance. The identity of the brand and the identity of consumers become intermingled. When preserved and honored, elements of brand heritage can have a powerful effect on consumer buying decisions. If these elements are discarded or minimized, consumers often feel betrayed or abandoned. This is one of the fundamental lessons to learn from the notorious consumer backlash over the introduction of New Coke in 1985.

There are many factors involved in business decisions, beyond those relating to marketing and brand identity. This is particularly true in the hotel industry, which has numerous third parties who own the underlying real estate. So it would be an overreach to criticize or question the entirety of the decisions made by Ritz or Taj. However, to an outside observer interested in marketing, this case suggests that Ritz underestimated the power of heritage and Taj overestimated the value of product attributes.

Any company would be fortunate to have consumers who love their brand in the way that Bostonians have loved the Vincent Club and the original Ritz-Carlton. Leaders of mature companies would benefit from realizing that history is more than a set of old stories.