staying on BRAND
Why so many hotel brands within a group? Catherine Chetwynd takes a look at the big groups' relentless roll-out of new hotel names
Marriott has 30, Wyndham 20, Accor 28, Hilton 14 and IHG has 12 – the proliferation of brands seems to be unstoppable, with hotel companies continuing to acquire and launch them at every turn.
They cover every conceivable consumer requirement from budget to lifestyle and luxury but whatever any hotel operator tells you, these are not created in answer to traveller demand.
“Owners are causing the proliferation of brands. In some cases contracts between hotel operators and owners prevent the operation of another property of the same brand within five miles but that does not stop them putting one of similar market positioning within five miles,” says consultant to the hotel industry Melvin Gold.
It is all about expansion: “They have to find ways of getting more product out there. I am sure the consumer – business or leisure traveller – does not think ‘what we really need is another hotel brand’.”
But originality is thin on the ground, he believes. “I don’t think the big hotel companies are coming up with anything hugely innovative. Smaller entrepreneur hotel brands are doing that but they tend to be acquired by the larger companies, who sell the real estate and hang on to the management contract or franchise deal.”
However, experience is all and that has to be innovative. “Ibis Canning Town has embraced the open lobby concept and done away with hotel reception desks and receptionists. In 40 hotels in the UK, they check you in on your phone and issue a key, which you touch to card readers by the lift. The system knows who you are and charges your key card to your room,” says Gold.
Logistics of loyalty
Raj Sachdave of consultancy Black Box Partnerships adds: “Quirky brands like Moxy... how you check in, the property management system, the interaction with the hotel – that is all a key part of innovation, rather than the brand itself.”
Accor’s investment in customer experience is a good example: “And that underpins loyalty, they are not just relying on the number of points customers can get.”
Loyalty points are a double-edged sword: “The net value of points that have not been redeemed is an eye-watering amount and hotel companies can plug that exposure by opening more properties in key locations, where travellers can redeem their loyalty points. It does not hurt the net return of the portfolio,” he says. This way, cannibalisation is not an overriding concern.
Edwardian Hotels’ bot called Edward is a case in creative point. As guests approach the hotel, he knows they are in the vicinity through their mobile device and offers to check them in. As they arrive in the lobby, they are given a room number and use their smartphone to access their room.
“Technology enables us to remain innovative,” says Director of Information Technology, Michael Mrini. “Our virtual host, Edward, interacts with our room guests and meeting delegates to ensure they have what they need during their stay, whether that is extra towels or additional cables. We are constantly looking for new ways to provide exceptional service and technology plays a key part in that.”
If two buyers’ views are typical, however, brands are not a corporate priority. “Marriott, Hilton and IHG have so many brands under their banner, it is difficult to determine what you are getting,” says PA to the directors at engineering company Cullum, Cherry Salvesen.
Similarly, “Brands don’t mean anything anymore, it has become ridiculous,” says Corporate Purchasing, Global Category Manager Travel & Mobility for Continental Teves, Rüdiger Bruss.
I am sure that the consumer – be it business or leisure traveller – does not think ‘what we really need is another hotel brand’”
Instead, location comes first. “We are not in a position to get a deal with many hotels because we don’t stop long enough in any one place,” says Salvesen. “We look at what is best for travellers in location and facilities – that may mean car parking if they have vehicles full of tools.”
And Continental’s priority is: “Where is the hotel and can I get from the hotel to our plant or the customer easily and quickly? It does not matter if it was a Courtyard and has been rebranded as a Moxy,” says Bruss.
“We negotiate with individual properties we use regularly, where we can give them some volume, and have chain-wide discounts with certain groups because they have properties in a location convenient for our need and those are preferred properties in our system.”
Meanwhile, soft brands are making their mark. Typical are Autograph by Marriott, Tapestry by Hilton, The Unbound Collection by Hyatt and Trademark Collection by Wyndham. 'Collection' in the name is usually the giveaway.
“Most soft brands are aimed at the luxury hotel owner but we saw an opportunity to work with independent hoteliers who operate upper midscale properties and who want to maintain that independence while taking advantage of Wyndham’s scale, services and loyalty programme,” says the group’s Chief Development Officer EMEA, Philippe Bijaoul.
And acquisition master Accorhotels has bought a business or brand every month for the past two years in a bid to provide augmented hospitality, according to an article on skift.com.
“A large hospitality group can’t compete with large technology platforms without comprehensive brand portfolios that cater to every single human need,” said Accor's Global Chief Brand Officer, Steven Taylor, at the Skift Tech Forum, a reference to platforms such as Google and Amazon, which have increasing influence on travel.
The company acquired Mövenpick Hotels & Resorts in April, took a 50% stake in South Africa-based Mantis Group and is buying Mantra Group in Australia.
Meanwhile, Hyatt has launched Hyatt Centric aimed at ‘luxury and business travellers who are curious, independent and hungry for authentic experiences’ and it also bought wellness hotel brands Miraval and Exhale last year.
Wyndham has added ‘by Wyndham’ to all its brands so that, “customers know they are receiving a trustworthy service and international standard of accommodation, no matter which brand they choose”, says Philippe Bijaoui. At the budget end, Yotel has Yotel in city centres, YOTELAIR at airports and, in January, launched serviced apartments under the YOTELPAD flag.
Business travellers have access to a variety of styles and service levels through preferred hotel partners in a travel programme, but brands do not, it seems, get the message across to travel buyers, whose main concern is convenience for the traveller.
A large hospitality group can’t compete with large technology platforms without comprehensive brand portfolios that cater to every human need”