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Hilton Q1/2015 Call: New budget brand & interest in Starwood (brand)?

Hilton Q1/2015 Call: New budget brand & interest in Starwood (brand)?

Old May 17, 2015, 11:37 am
  #16  
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Originally Posted by ORDnHKG
Well Hamptons had already up their rate for a while now even there are no new brand, good luck in finding Hampton that is still $99. My most recent overnight stay at DFW, Hampton was $135, given I am leaving the next day at 5am, I wouldn't even benefit for breakfast, all I need is a comfortable bed and shower in the morning, shuttle to and from DFW, there is no reason I am paying anything over $100 for a stay that short.

So I look for Choice, found a Sleep Inn that had just finished remodeled that cost $76, I could even gone for the nearby Quality for just $49, but when I read the reviews on tripadvisor about that Quality, seems like there are quite a bit of complains, so I pay $27 more to stay at Sleep Inn, still almost less than half of what Hampton cost. Choice got my business.
All depends on the location, for some of the places I go Hampton's are regularly lower than $100 a night, especially on weekends. Other places, usually $100-$150 a night. I do 9 night stays usually.
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Old May 17, 2015, 6:34 pm
  #17  
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Originally Posted by Baze
All depends on the location, for some of the places I go Hampton's are regularly lower than $100 a night, especially on weekends. Other places, usually $100-$150 a night. I do 9 night stays usually.
I wish there are Hamptons lower than $100 a night of where I am going, even airport area can't find at that cost, unless it is really in the middle of nowhere. Even at Hampton near GJT costs close to $200, so I stayed at the Ramada nearby instead, paying less than $100, even come with hot breakfast !

Of course you probably know Hamptons in NYC are close to or above $300
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Old May 18, 2015, 7:24 am
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If Nassetta thinks that Hampton has outgrown the budget designation, then he's not staying at the right Hamptons. Interstate, small town, etc. locations are plenty cheap - and still a great budget brand.

However, I agree that Hilton has allowed in particular the urban locations to creep up. I still don't see how this stops making it a budget brand however - just because rooms happen to cost a good bit. A rising tide lifts all ships, and occupancies/prices are up everywhere. That doesn't change the brand, though - the properties are still slotted in where they should be compared to full-service, business, or luxury hotels in their respective markets. I paid $200 for a Hampton in Boston a couple weeks ago...but the DTs were $300 and the Hiltons were $400+.

Personally I think that Hampton has the bottom part of the Hilton portfolio quite nicely locked up, has good brand recognition, attracts the same sort of customers nearly universally, and I would not mess with it.
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Old May 18, 2015, 7:38 am
  #19  
 
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Originally Posted by sdsearch
Hilton could buy La Quinta, which is a single-brand chain (www.lq.com), and that brand is around the same level as a Sleep Inn or Comfort Inn (at Choice). And since the chain is the same as the brand, it can bought lock stock and barrell without breaking a chain up. And they have plenty of locations around the US (of varying quality, which is an issue with every brand below the Hampton/Fairfield/HIX level*).

*Hilton is already familiar with varying quality, courtesy of DoubleTree, so why should that stop them?
Ironically, LaQuinta, like Hilton, is already owned by Blackstone. I think that Hilton wants to start a new budget brand from scratch.
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Old May 18, 2015, 8:13 am
  #20  
 
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Originally Posted by loomis
Originally Posted by sdsearch
Hilton could buy La Quinta, which is a single-brand chain (www.lq.com), and that brand is around the same level as a Sleep Inn or Comfort Inn (at Choice). And since the chain is the same as the brand, it can bought lock stock and barrell without breaking a chain up. And they have plenty of locations around the US (of varying quality, which is an issue with every brand below the Hampton/Fairfield/HIX level*).

*Hilton is already familiar with varying quality, courtesy of DoubleTree, so why should that stop them?
Ironically, LaQuinta, like Hilton, is already owned by Blackstone. I think that Hilton wants to start a new budget brand from scratch.
This what I am getting at. He wants to build brand new what are basically Hampton Inns and price them at a Sleep Inn rate. The new name would be Magical Inns and suites by Hilton where "it can't be done but we just did it"
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Old May 18, 2015, 8:27 am
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I'd likely be interested in a new budget brand (not acquisition) at first while the properties are new/fresh but likely lose interest as the properties age/weather. A lower earnings rate, like at Home2, would also temper my interest to a certain degree.
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Old May 18, 2015, 2:46 pm
  #22  
 
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Originally Posted by loomis
Ironically, LaQuinta, like Hilton, is already owned by Blackstone. I think that Hilton wants to start a new budget brand from scratch.
However, wouldn't it make sense to either move LQ into Hilton or use the properties as the basis for the new chain?

Think of the potential benefits:

1. Reduce corporate overhead and get efficiency savings, switch to better supply contracts from both sides - admittedly you could do that without merging the marketing

2. Get dense coverage immediately - essential to building loyalty in a budget chain

3. Switch the brand for lower-end Hamptons to preserve the brand as being more 'mid market' than budget

4. Use either the LQ name or the new brand to highlight that properties have been refreshed to attract custom

5. Get whole-life customers who start with travel to low-end motels and as they become more affluent, lock them in to Honors - or provide a back-up for areas where there isn't coverage

6. Grow the market for LQ properties - as long as they don't cannibalize - by pitching them at Honors members - as well as using the LQ network, in combination with others, to help drive corporate deals through lower cost or better coverage.
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Old May 18, 2015, 3:07 pm
  #23  
 
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But just how bad are some of the LQ properties? From the way I've heard some described, Hilton could be inheriting a liability. And certainly they wouldn't want to drag their whole program down to the lowest common denominator - a possibility as people are generally program-loyal, rather than brand-loyal.

I'm not saying what you suggest isn't doable and doesn't make sense from a business-plan perspective; your points are well articulated and well-taken. I'm just thinking they'd have to be careful. Making a run at the very bottom of the barrel is a risky strategy and they have to make sure not to lose more than they gain.
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Old May 18, 2015, 4:20 pm
  #24  
 
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I just googled "Worst La Quinta ever" and the top result was the MIA airport north property, which looks better* than the Hampton Inn Miami Airport West.

(Actually, they look pretty similar, except that the LQ has external doors to the rooms rather than internal corridors).

I agree though - if there are properties that are so bad that they could damage the program, that would be a risk of integrating LQ wholesale, less so if they were to split the chain into a smaller brand before selling off the more 'challenged' properties.

* - Better because when I stayed in the HI, there was a flight attendant called Howie asleep in the room I'd checked myself into, and that's apparently not a feature of the LQ.
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Old May 19, 2015, 7:14 am
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Originally Posted by Cymro
when I stayed in the HI, there was a flight attendant called Howie asleep in the room I'd checked myself into, and that's apparently not a feature of the LQ.
I wonder if Howie was the same guy that they gave the key to my room to a couple years ago at a Hilton in Boston? That was a surprise!
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Old Jul 30, 2015, 3:12 pm
  #26  
 
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New Midscale Hotel Brand From Hilton

Yesterday, it was again confirmed that Hilton are going to startup a new brand, below the Hampton Inns.

http://www.travelagentcentral.com/ac...d-hilton-52534

http://www.bizjournals.com/phoenix/m...tel-brand.html
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Old Jul 30, 2015, 3:35 pm
  #27  
 
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Originally Posted by Sisosig
Yesterday, it was again confirmed that Hilton are going to startup a new brand, below the Hampton Inns.
I love the idea of a brand below Hampton Inns. If people can stay in Boston, NYC, or San Francisco for around $100 per night or along the highway for $50 per night then they will get a lot of business. Maybe these will become the new category 1 hotels?
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Old Jul 30, 2015, 4:12 pm
  #28  
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Originally Posted by ChinaShrek
I love the idea of a brand below Hampton Inns. If people can stay in Boston, NYC, or San Francisco for around $100 per night or along the highway for $50 per night then they will get a lot of business. Maybe these will become the new category 1 hotels?
Probably 5 points per dollar.
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Old Jul 30, 2015, 5:21 pm
  #29  
 
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Originally Posted by Sisosig
Yesterday, it was again confirmed that Hilton are going to startup a new brand, below the Hampton Inns.
Yikes. I wonder what the eggs will be made of on a brand below the Hampton.
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Old Jul 30, 2015, 8:08 pm
  #30  
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Originally Posted by txpenny
Yikes. I wonder what the eggs will be made of on a brand below the Hampton.
Maybe only real eggs, like at La Quinta?

Ie, there's hot eggs, and then there's hardboiled eggs. Some properties below the level of Hampton don't bother with hot eggs or facsimiles thereof at all, and just serve hard-boiled eggs as the only eggs. But since hard-boiled are real eggs (too hard to fake), it's actually a step up in "egg realness"!
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