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Why is Hilton so conservative about expansion?

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Why is Hilton so conservative about expansion?

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Old Jun 13, 2006, 8:31 am
  #1  
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Why is Hilton so conservative about expansion?

It's always bothered me that Hilton is this global hotel brand, probably the world's most famous brand, but their global presence isn't actually very widespread. It really bothers me that there still isn't a Hilton in Moscow, or anywhere in Russia, nor is there a Hilton presence in places like Taipei, Manila, Jakarta,Tbilisi, Baku, etc. All these places have Marriotts or Starwoods of Intercontinentals, three hotel groups which seem to have proper international coverage. It seems that there must be a deliberate conservativeness to Hilton's expansion strategy if they purposely allow the other chains to surpass them in coverage.
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Old Jun 13, 2006, 8:43 am
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And not just Hilton, what about expansion of a cheaper range of hotels ... like Hampton Inns across the world ?
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Old Jun 13, 2006, 9:04 am
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Originally Posted by Karter
It's always bothered me that Hilton is this global hotel brand, probably the world's most famous brand, but their global presence isn't actually very widespread. It really bothers me that there still isn't a Hilton in Moscow, or anywhere in Russia, nor is there a Hilton presence in places like Taipei, Manila, Jakarta,Tbilisi, Baku, etc. All these places have Marriotts or Starwoods of Intercontinentals, three hotel groups which seem to have proper international coverage. It seems that there must be a deliberate conservativeness to Hilton's expansion strategy if they purposely allow the other chains to surpass them in coverage.
IMHO, part of the answer is that Hilton wants to be in the Hotel Business, not in the property business. They would like others to invest in the real estate, especially in the developing economies. Hilton would like to provide the training, access to the reservations system not to mention the HHonors program. The question for potential investors is: Does Hilton offer the best deal compared with say *wood or Marriott? @:-)
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Old Jun 13, 2006, 9:07 am
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Originally Posted by Travel The World
And not just Hilton, what about expansion of a cheaper range of hotels ... like Hampton Inns across the world ?
There aren't many Fairfield Inns in Europe, either.

The only chains I can think of with "cheaper" brands overseas would be Intercontinental with their Holiday Inn (Express), and Choice, which is a cheaper line anyhow.

Perhaps it's because the market over there is different -- traditionally, the lower end has been covered by local inns, B&Bs, and so on. Why compete with them on the low end where you have to work harder for the profit dollar?

Still, a Hilton presence would be nicer in more places.

And don't get me started on Spain ....
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Old Jun 13, 2006, 10:48 am
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starwood may actually have less properties than hilton worldwide.

Putting that aside, i have found hilton to be more flexible in their room decor, furnishings and hilton hhonors programme. They tend to price their rooms cheaper than starwood but tends to be more welcoming. Sometimes some of the other chains like Hyatt and starwood try to make their hotels too grand that it seems daunting.
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Old Jun 13, 2006, 12:11 pm
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This is why Hilton USA just bought back Hilton International. Hilton has many new Conrad's in the pipeline, and now I fully expect to see many new hilton's and perhaps even other Hilton brands being developed overseas.

And I expect that very few if any of these will be Hilton owned properties -- they will be managed by Hilton owned by someone else.
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Old Jun 13, 2006, 12:16 pm
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I believe the problem with Int'l expansion stemmed from Hilton until recently being two separate companies...the US headquartered in Beverly Hills and the non US branding handled by Hilton International in the UK. I believe at the time of having the two companies, Conrad was jointly owned...hence the miniscule number of hotels there...

Now that the companies are one, I would love to see the expansion we all crave...from Conrads to Hiltons to HGI's...it is loooong overdue around the world especially in cities where your only choice is a 1960's vintage Hilton held together with spit and duct tape .
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Old Jun 14, 2006, 7:03 am
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I am very hopeful about the fact that Hilton USA bought back Hilton International. So far the only change I've noticed has been in HR. For years Hilton Intl ran a graduate recruitment programme for top tier new UK university graduates that gave them a 6 month paid internship at a UK hotel, followed by 6 months at an non-UK Hilton and then a fast track to being GM of a Hilton Family property. This scheme seems to be over now.

You're right though, it's not just about international coverage but the expansion of the budget brands. Accor seems to be a prime example of a European hotel chain that can have success with a range of hotel models, from high-end to bottom-end... Sofitel, Novotel, Mercure, Ibis...
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Old Jun 14, 2006, 8:46 am
  #9  
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Originally Posted by NJRob
Now that the companies are one, I would love to see the expansion we all crave...from Conrads to Hiltons to HGI's...it is loooong overdue around the world especially in cities where your only choice is a 1960's vintage Hilton held together with spit and duct tape .
This is Hilton's stated strategy. They will be rolling out primarily Doubletrees, HGIs and Hampton Inn's overseas, which they couldn't do before they bought Hilton International. And yes, they will be relying on third-party developers to build the hotels, and Hilton will have to compete with *W and Marriott's brands (and others) to get the franchise/management agreements. But I think this will take a couple of years.
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Old Jun 14, 2006, 9:50 am
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Like a previous poster stated as well, Accor has a very large following in Europe. It is often hard to book a room in any one of the ubiquitous Formula1, Etap or Ibis hotels because the prices are so attractive. Many Europeans will fill these up on weekend trips at 25-75 euros instead of paying 150-200 euros at the US chains. They are also attractive because instead of being massed downtown as a whole, many of them are more convenient by automobile. The rooms aren't anywhere near as nice as the Hilton, but for someone needing a bed and shower, these are very good deals for the money. I'd like to see a Hampton Inn in Europe, but I think it will be a while.
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Old Jun 15, 2006, 4:32 am
  #11  
 
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Originally Posted by ijgordon
This is Hilton's stated strategy. They will be rolling out primarily Doubletrees, HGIs and Hampton Inn's overseas.
I haven't heard this stated before. Presumably they'll start by rebranding some of the existing "Hiltons" to HGI's, as has been suggested in previous threads.

Has anyone seen a press release confirming the above ?
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Old Jun 15, 2006, 11:24 am
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Originally Posted by BigLar
Still, a Hilton presence would be nicer in more places.

And don't get me started on Spain ....
I'm just worried for you that someone might get the idea to put Motel 6's everywhere. Then your decision to go M6-paid or Hilton-on-points will be tougher
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