Mehdron
Jun 9, 05, 4:10 pm
Does a 42-Inch Plasma TV Justify a 4-Star Hotel Price? (http://www.nytimes.com/2005/06/07/business/07road.html)
By JOE SHARKEY
Published: June 7, 2005
Beverly Hills, Calif.
A LOT of attention has been paid in recent years to the remarkable profusion of top-shelf five-star luxury hotels operated by major chains in cities here and around the world. Now domestic hotel companies are trying to get you to pay more attention to the category one star down the ladder.
With business travel up and prosperity returning to the lodging business, business travelers are edging back to four-star hotels. So the big chains are scrambling to liven up and clearly define their four stars, whether they be a Sheraton, a Marriott or, in the case at hand, a Hilton.
Recently, Hilton Hotels, which operates Hiltons and five other major hotel brands in North America (including Embassy Suites and Hampton Inn), made its top executives available to a small group of travel and lodging-industry trade reporters. Significantly, the daylong session was in Beverly Hills, at the 50-year-old Beverly Hilton Hotel, which had faded badly in recent years but has recently undergone a $60 million renovation. Along with a flashy Hilton that opened in a 44-story tower in 2000 on 42nd Street in Times Square, it is considered a model to define the brand in a newly hot market.
A colleague on the panel was not persuaded that the definition was all that clear. "So what the hell is a Hilton?" he asked the executives.
"People can't necessarily articulate it," conceded Jeff Diskin, the senior vice president for brand management and marketing at the company. The brand is defined, he suggested, "if we collectively give people an experience that says, 'Yes, I'm proud of what it says about me to stay here; it makes me feel good; I'm in charge of my stay.' "
Even academic experts think hotel companies have a problem defining what a four-star hotel is. "Hilton, in my opinion, is a poorly defined brand in a confusing segment," said Chekitan S. Dev, a professor of marketing at the School of Hotel Administration at Cornell University.
In recent years, Hilton and its four-star competitors fell into a rut, said Professor Dev, who is also a consultant for Hilton. While five-star luxury brands like Ritz-Carlton, Four Seasons and Peninsula pulled far ahead, three-star brands like Marriott Courtyard and even Hilton's own Hampton Inn bumped up and "outvalued" the staid four-star hotels. "Hilton lost its pre-eminent position by not responding in a timely manner to key market trends," he said.
That's one reason Hilton is showing off its renovated Beverly Hilton, which Conrad Hilton opened as a showpiece in 1953 and which looks like Hollywood's version of the Fontainebleau Hotel in North Miami Beach.
The 570-room Beverly Hilton was owned from 1987 to 2003 by the entertainer Merv Griffin. It was then purchased by Beny Alagem, the co-founder of Packard Bell Electronics. Mr. Alagem undertook an ambitious renovation in conjunction with Hilton, which has managed the property since it opened.
Matthew J. Hart, Hilton's president and chief operating officer, was not coy about the Beverly Hilton's loss of luster during Mr. Griffin's ownership. "The rooms were terrible," he said. "They were dated and they were smelly."
Given its prime location, the hotel had become a disturbing symbol of how the Hilton brand "had lost its way," conceded Thomas L. Keltner, the executive vice president for brand performance and development.
In many cities without fierce competition in the luxury niche, a hotel like the refurbished Beverly Hilton would actually be regarded as a five-star property. The new rooms have 42-inch plasma high-definition television screens and Bose Wave radios. They also have ample, well-designed work spaces, reflecting the company's goal of transforming the hotel, which long catered mostly to leisure travelers on package tours, into a property where business travelers constitute 80 percent of the clientele. The meeting spaces and the main ballroom - where the Golden Globes movie awards ceremonies are held - have also been renovated.
There are 230 Hilton Hotels, with 89,000 rooms, in North America and Mexico - and all of them, from Albuquerque to Beverly Hills to Times Square, are under pressure to burnish the Hilton brand. "A lot of people said, What took you so long?" Mr. Diskin said of the move.
Hilton and its franchisees have committed to spending $500 million on renovations over the next three years. Hilton is also cracking down on laggards among its franchisees. Last year, 17 underperforming (read, run-down) Hiltons were forced to haul down the Hilton flag. But the company expects to open 60 new Hiltons through 2007.
By JOE SHARKEY
Published: June 7, 2005
Beverly Hills, Calif.
A LOT of attention has been paid in recent years to the remarkable profusion of top-shelf five-star luxury hotels operated by major chains in cities here and around the world. Now domestic hotel companies are trying to get you to pay more attention to the category one star down the ladder.
With business travel up and prosperity returning to the lodging business, business travelers are edging back to four-star hotels. So the big chains are scrambling to liven up and clearly define their four stars, whether they be a Sheraton, a Marriott or, in the case at hand, a Hilton.
Recently, Hilton Hotels, which operates Hiltons and five other major hotel brands in North America (including Embassy Suites and Hampton Inn), made its top executives available to a small group of travel and lodging-industry trade reporters. Significantly, the daylong session was in Beverly Hills, at the 50-year-old Beverly Hilton Hotel, which had faded badly in recent years but has recently undergone a $60 million renovation. Along with a flashy Hilton that opened in a 44-story tower in 2000 on 42nd Street in Times Square, it is considered a model to define the brand in a newly hot market.
A colleague on the panel was not persuaded that the definition was all that clear. "So what the hell is a Hilton?" he asked the executives.
"People can't necessarily articulate it," conceded Jeff Diskin, the senior vice president for brand management and marketing at the company. The brand is defined, he suggested, "if we collectively give people an experience that says, 'Yes, I'm proud of what it says about me to stay here; it makes me feel good; I'm in charge of my stay.' "
Even academic experts think hotel companies have a problem defining what a four-star hotel is. "Hilton, in my opinion, is a poorly defined brand in a confusing segment," said Chekitan S. Dev, a professor of marketing at the School of Hotel Administration at Cornell University.
In recent years, Hilton and its four-star competitors fell into a rut, said Professor Dev, who is also a consultant for Hilton. While five-star luxury brands like Ritz-Carlton, Four Seasons and Peninsula pulled far ahead, three-star brands like Marriott Courtyard and even Hilton's own Hampton Inn bumped up and "outvalued" the staid four-star hotels. "Hilton lost its pre-eminent position by not responding in a timely manner to key market trends," he said.
That's one reason Hilton is showing off its renovated Beverly Hilton, which Conrad Hilton opened as a showpiece in 1953 and which looks like Hollywood's version of the Fontainebleau Hotel in North Miami Beach.
The 570-room Beverly Hilton was owned from 1987 to 2003 by the entertainer Merv Griffin. It was then purchased by Beny Alagem, the co-founder of Packard Bell Electronics. Mr. Alagem undertook an ambitious renovation in conjunction with Hilton, which has managed the property since it opened.
Matthew J. Hart, Hilton's president and chief operating officer, was not coy about the Beverly Hilton's loss of luster during Mr. Griffin's ownership. "The rooms were terrible," he said. "They were dated and they were smelly."
Given its prime location, the hotel had become a disturbing symbol of how the Hilton brand "had lost its way," conceded Thomas L. Keltner, the executive vice president for brand performance and development.
In many cities without fierce competition in the luxury niche, a hotel like the refurbished Beverly Hilton would actually be regarded as a five-star property. The new rooms have 42-inch plasma high-definition television screens and Bose Wave radios. They also have ample, well-designed work spaces, reflecting the company's goal of transforming the hotel, which long catered mostly to leisure travelers on package tours, into a property where business travelers constitute 80 percent of the clientele. The meeting spaces and the main ballroom - where the Golden Globes movie awards ceremonies are held - have also been renovated.
There are 230 Hilton Hotels, with 89,000 rooms, in North America and Mexico - and all of them, from Albuquerque to Beverly Hills to Times Square, are under pressure to burnish the Hilton brand. "A lot of people said, What took you so long?" Mr. Diskin said of the move.
Hilton and its franchisees have committed to spending $500 million on renovations over the next three years. Hilton is also cracking down on laggards among its franchisees. Last year, 17 underperforming (read, run-down) Hiltons were forced to haul down the Hilton flag. But the company expects to open 60 new Hiltons through 2007.