Last updated: 02:37 PM ET, Mon November 23 2015

Viva Ziva! Viva Zilara!

Hyatt’s two new all-inclusive brands are ramping up for more growth

Vacation Agent | Hotel & Resort | James Shillinglaw

Viva Ziva! Viva Zilara!

PHOTO: Hyatt Zilara and Hyatt Ziva Rose Hall opened last December on the grounds of the old Ritz-Carlton in Jamaica. Photo courtesy of Hyatt Zilara and Hyatt Ziva.

The all-inclusive resort market has grown exponentially over the past 20 years. Indeed, there are nearly 40 major brands today, compared to just four back in the early 1990s. But something always seemed to be missing — an all-inclusive brand backed by a major U.S. hotel company.

That changed two years ago when Playa Hotels & Resorts, an all-inclusive resort developer and operator, teamed with Hyatt in July 2013 to launch two new, five-star all-inclusive brands — Hyatt Zilara and Hyatt Ziva. Hyatt Zilara targets adults, especially couples, while Hyatt Ziva is for everyone, including couples, families and larger groups.

Six All-Inclusive Properties
By the end of this year there will be six Hyatt Zilara or Hyatt Ziva properties in Mexico and Jamaica, including Hyatt Ziva Los Cabos, Hyatt Ziva Puerto Vallarta, Hyatt Ziva Cancun and Hyatt Zilara Cancun in Mexico, and Hyatt Zilara Rose Hall and Hyatt Ziva Rose Hall in Jamaica.

Playa, in which Hyatt has a significant minority stake, also is planning to introduce up to 25 new Hyatt all-inclusive resorts in the next four years. Bruce Wardinski, the company’s chairman and CEO, is leveraging the strength of the Hyatt name to grow these new all-inclusive brands throughout Mexico and the Caribbean, especially the Dominican Republic, and eventually expand them to Asia Pacific.

“We’re working on a pipeline and hope within a couple of years to have 15 to 25 resorts,” he says. “Our goal is to aggressively ramp up development with a combination of conversions and new-builds.”

To support that growth, Playa has been busy building up its management team. In September 2013, Playa named industry veteran Alex Stadlin as CEO of Playa Resorts Management to oversee operations. Then in December 2013, Playa brought in Kevin Froemming, former president of Sandals Resorts’ U.S. distribution arm Unique Vacations, as executive vice president and chief marketing officer. Playa’s main office in Florida has roughly 40 people on staff.

Wardinski, who spent most of his career with Marriott, Host Marriott and Crestline Hotels, formed Playa with Barceló in 2006 as a resort development company that purchased and operated all-inclusive resorts under the Barceló and AMResorts brands Secrets and Dreams throughout Mexico and the Caribbean. As Wardinski explains, it was while working with Barceló that his eyes were opened to the vast possibilities of all-inclusives for the U.S. market.

“Great Business Model”
“I just thought this was a great business model,” Wardinski says. “We could take advantage of my skill set and create an investment vehicle that would acquire properties that would be branded under the Barcelo hotel brands. That was the original premise of Playa.”

But everything changed when Playa bought out Barceló’s stake in the company in 2013. Wardinski says Marriott and Hilton were interested in getting into the all-inclusive market and approached Playa, but a deal couldn’t be reached. Then Hyatt, which initially just wanted to discuss the all-inclusive model so it could develop it on its own, decided it would be better to partner with Playa.

Wardinski says U.S. brands have been slow to get into the all-inclusive market because they have a fundamentally different business culture and operating model than all-inclusive resort companies. “Historically I think the operating culture and sales culture prevented U.S. hotels from getting into the all-inclusive market,” he says.

According to Wardinski, Hyatt realized that its own customers, driven by product and service, enjoyed staying in all-inclusive resorts. Hyatt also understood that it needed a partner with experience in the market so it could quickly grow its own all-inclusive resorts unlike other U.S. hotel chains. “Nobody else has what Hyatt has, which is a distinctive all-inclusive brand,” Wardinski says.

For Playa, Hyatt provides access to a global brand with name recognition, a vast distribution network, a website, a group sales program and a frequent guest program. He also cites the credibility factor with Hyatt’s name, which is a major reason why groups book a hotel. Indeed, Hyatt’s new all-inclusive resorts are seeing impressive group bookings since they were launched two years ago.

The first property launched was the Hyatt Zilara Cancun in November 2013, followed by the Hyatt Ziva Los Cabos in December 2013, a resort severely damaged by the hurricane last year and reopened last month after a major refurbishment.

Hyatt Ziva Rose Hall and Hyatt Zilara Rose Hall, twin properties located on the site of the former Ritz-Carlton Rose Hall, were opened in Jamaica in December 2014, at roughly the same time the Hyatt Ziva in Puerto Vallarta opened. In November, the Hyatt Ziva Cancun, formerly a Dreams resort, will open as the company’s new flagship property.

Beyond the partnership with Hyatt, Playa also has entered the all-inclusive market in the high-end in what it calls the five-star-plus category. It even has its own trademarked slogan, “The Evolution of All-Inclusive,” seeking to distinguish itself from other all-inclusive resorts in the market. It also launched “Service From the Heart,” an initiative to find and train key staff members who can truly deliver memorable experiences at every resort.

For Froemming, the competition for Hyatt Zilara and Hyatt Ziva is best-in-class all-inclusive resort brands, such as Sandals, Secrets, Karisma and Palace, but he also regards cruise lines with high-end products as competition as well. On the other hand he says Playa’s strategy wasn’t simply focused on shifting business away from other five-star properties.

New EP Customers
“Because of the Hyatt brand we brought with us a whole new audience of EP [European Plan] customers,” Froemming says. “That’s the biggest news when you look at our story and where our growth has come from. It’s come from first-time all-inclusive customers.”

Froemming says Hyatt Zilara and Hyatt Ziva target guests who are looking for a discerning difference, those who want to have a great vacation but are willing to spend more than what they might get for a $99 a night all-inclusive vacation. “When customers come back, they want to be able to talk about their experience and how it made them feel,” he says. “A lot of the feedback we get about our staff is that it’s the single biggest thing guests like.”

Those customers want all of the conveniences, amenities and personalized services that they believe come only with EP products. “We’ve really focused on how you get that five-star personalized experience, but in a five-star plus all-inclusive environment,” Froemming says.

That means focusing on delivering an expanded roster of dining and beverage experiences, in particular, by offering such unique venues as a Brazilian Churrascaria, the first at an all-inclusive; Barefoot Jerkz, a Jamaica jerk restaurant; Fez, the first-ever Moroccan-themed rooftop lounge; and the first true sports bar, with more HD flat-screen TVs and access to most U.S. sports cable channels, as well as bar staff dressed in NFL uniforms during the football season.

Beyond dining, Hyatt Ziva and Hyatt Zilara also feature special butlers for guests who book a cabana. These butlers deliver an ice chest, as well as wine, beer and liquor. Similar butlers are available for guests who book fire pits at night, so guests can be served without having to go to the bar.

In addition, Playa is focusing on delivering a destination experience beyond its Hyatt resort, according to Froemming. It has partnered with key ground handlers and tour operators so it can provide the best excursions and activities in the destinations surrounding its properties. For example, in Jamaica it has partnered for tours and transfers with Island Routes, considered top in the market.

Playa also has been building brand awareness for Hyatt Zilara and Hyatt Ziva with partnerships and social media programs. While Playa has used advertising to raise brand awareness, it also has engaged in an extensive social media campaign showcasing guests at its resorts. It also has encouraged travel agents to share guest experiences, such as weddings at the resorts, through social media outlets.

Wardinski: “We’re absolutely committed to the travel agent community and working with them to grow these brands.”

Wardinski admits the Hyatt Zilara and Hyatt Ziva brands are still not well known by U.S. travel agents or their clients, but that is changing very quickly. Playa is actively promoting the new brands to the trade and has introduced new programs to raise awareness among agents and reward them.

“We’re absolutely committed to the travel agent community and working with them to grow these brands,” Wardinksi says. “We’re hoping to have as many strategic partners as we can get… and we’re committed to delivering the highest product with Hyatt Ziva and Hyatt Zilara positioned as a five-star product.”

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Vacation Agent Magazine

A version of this article appears in print in the October 2015 issue of Vacation Agent Magazine.