ATLANTA — Brands are constantly evolving to appease the ever-changing demands of both owners and consumers, but brand development leaders say it’s vital that the ethos of each one stay the same amid the change.
Hotel executives speaking during the “Brand Evolution” panel at the 2023 Hunter Hotel Investment Conference discussed the fluid change of brands, how companies assess white spaces in their portfolios and the camaraderie of the industry.
Chip Ohlsson, executive vice president and chief development officer at Wyndham Hotels & Resorts, said brands are bound to evolve, but the foundation must remain consistent.
“If a brand changes, it never was a brand,” he said. “You can evolve because things change, people change, trends change, but it doesn’t mean the brand should change who they are. You should stay true to who you are.”
A brand is a promise that means something different to both owners and guests, said Bill Duncan, global head of suites and focused service brands at Hilton. For owners, it means delivering strong returns, and for guests, it means being reliable no matter the occasion.
When creating a brand, the best interests of both the consumer and the developer must be in mind, said Matt Hostetler, chief development officer at Red Roof.
“You have to think of it twofold. If you’re going to create a brand that no one’s going to be interested in, to develop [or] to provide to the consumer, then why do it?” he said. “You have to involve everybody in the process.”
Brian Quinn, chief development officer at Sonesta, said starting the process with the consumer and developer creates a trickle-down effect that benefits everyone.
“If those two things are working correctly and you’re taking care of them, all the other constituencies … will be happy,” he said. “You’ll have happy guests, which is going to enhance the brand and they’re going to patronize the brand more and more, [and] you’re going to have a happy owner who’s going to continue to invest.”
Duncan said the development process starts by identifying a white space in Hilton’s portfolio and then blending the needs of the guest, the owner and Hilton. Having a relevant brand for each segment is crucial to serving all customers traveling around the globe.
The network of providing the needs for each party creates a business loop that feeds off of each other, he said.
“If you’re going off this principle that everybody deserves a great quality stay no matter what segment they’re staying in, then you go, ‘OK, how do we create this?’” he said. “We’re just going to want to make sure we can serve those customers on the trip occasion where they want to go [at the] right place, right time, right price.”
The process of evolving and developing a brand has never been more efficient due to better information available today. Ohlsson said data analytics can point to trends that weren’t visible in the past, such as where the best location is to maintain room nights and best serve guests in the particular segment.
“We used to look at markets and say, ‘We’re going to be in this market.’ Now we look at a market and say, ‘We’re going to be at this market at this site, on this exit,’” he said. “That’s how much more competitive it’s gotten out there that we can actually pinpoint how much smarter we got.”
That evolution process begins at the development level, Ohlsson said. Good branding should convince consumers to evolve their tastes because the company shows them how to evolve.
“If you stop providing the service to the consumer or to the owner at any point, then at the end of the day, it’ll go the way of the dinosaurs; it’ll devolve very quickly,” he said. “You have to stay fresh, you have to stay current.”
While the world of development is competitive in nature with brands duking it out to obtain ownership contracts, panelists agreed that it’s far from “cutthroat.”
Quinn said he often speaks to members of competing brands for advice.
“Actually, [there’s] a lot of cases where we’re on the phone helping each other out,” he said. “I think it is unique though. When you speak to the growth leaders in other industries, it is not necessarily like this.”
Ohlsson said he believes in the strength of Wyndham’s value proposition, so the strength of other brands only drives its product to be better.
The health of the hotel industry is dependent on the collective strength of each individual brand, he said. A healthy industry increases the overall demand for travel, which can only serve to benefit all brands.
“Now, do we want to win? Yes, everybody wants to win, but we don’t necessarily need the others to fail to do that,” he said.
Duncan said Hilton wants to be the best, and the competition in the industry is what pushes the best version of his brands. He said having both the camaraderie and competition is what makes the industry special.
“That’s what I love about the service industry, is that you can be competitive, but you can also go grab a beer at the end of the day and talk and have a relationship and friendship even though you may not be working [together],” he said.
Don’t get boxed in by your bank’s lending limits. Let’s find the perfect lending solution for you, email me at acomcapital@gmail.com or book a time with me here: https://go.oncehub.com/RajaMaan
Follow us ACOM Capital
Follow us on social media
Welcome to Acom Capital, your gateway to tailored financing solutions for Investment Residential and Commercial Real Estate.
Copyright © 2024 Acom Capital. All Rights Reserved.
