For years, watching hotels brand has been like watching cells under a microscope: First they divide, then they divide again. Before you know it, there's a brand for every permutation of the marketplace. That's why it is surprising to see that suddenly, at the resort level, the new trend is to soft-pedal the brand affiliation, or do away with it altogether.
"It's so funny," muses Steve Bartolin, CEO, Colorado Springs' The Broadmoor. "It wasn't more than 15 years ago when the proliferation of brands really began. The word back then was, 'You've got to be branded; in 10 years, there'll be no such thing as an independent hotel of any significance, because there's no way they can compete.' I heard that in lodging meetings all over the country, and now they've come full circle."
New ethics policies and regulations—be they corporate, pharma code, or Sarbanes-Oxley—mandating "more restrictions on the type of venue we can use," according to Barbara McManus, planner for Somerville, NJ-based Centeon Management Group, have caused resorts to downplay luxe associations. Keely McNerney, of Keely McNerney Associates, in Alexandria, VA, remembers: "A year ago; a pharma company could not sponsor a retreat if it was at a high-end chain."
In Name Only
"LXR's strategy," says John Tolbert, president of sales and marketing for the fledgling luxury group, based in Boca Raton, FL, "is to create a unique collection of trophy assets. Each tells its own story and own experience." In August 2005, LXR, which was launched by the New York City-based equity group, Blackstone, removed the Wyndham flag from properties that had, in some cases, been flying it for years. "Restoring the El Conquistador name in place of the Wyndham El Conquistador Resort & Spa [in Puerto Rico]," says Tolbert, "and letting the Wyndham Boulders [in Carefree, AZ] just be The Boulders Resort, allows each one to reflect the places they're in." Tolbert refers to the restoration process, which includes an infusion of more than $400 million, spread among 24 properties over the next several years, as returning "each trophy asset to its original DNA."
LXR promotes each property within its own marketing collateral but underplays the affiliation on the property level. Interestingly, the best-known chains also have properties where the brand affiliation is kept close to the vest. In 1995, Starwood's Hotels & Resorts created today's Luxury Collection, where iconic properties like The Phoenician in Scottsdale, AZ, The Royal Hawaiian in Waikiki, HI, and the Ballantyne Resort in Charlotte, NC, retain their original monikers without brand embellishment.
Twice Is Nice
In January, Hilton Hotels, with the acquisition of the Arizona Biltmore in Phoenix, La Quinta, in California's Desert Resorts area, and the Grand Wailea in Maui, HI, launched the Waldorf=Astoria Collection. At first glance, these famous yet vastly different properties appear to pose a branding challenge. But, by leading with the individual property name, David Greydanus, SVP of brand management, says that Hilton's strategy is to double their brand equity. "By appending the Waldorf=Astoria name to those hotels," he explains, "we not only give them that Waldorf=Astoria stamp of approval, we celebrate their heritage, their uniqueness, and their very eclectic but very wonderful presentation. We bring Hilton's global sales reputation, our worldwide reservations network, our OnQ technology, our Hilton HHonors frequency program, our Hilton purchasing, our Hilton management expertise. We bring all that to bear on these hotels, to make them far more successful than they were before."
"It's almost like a double endorsement," says Andrew Houghton, full-service brand executive, Marriott International, "to allow a legacy hotel to be endorsed by a legacy name where a hotel is known by consumers widely." Marriott International, too, has gone outside the box with a handful of properties, including Le Merigot, in Santa Monica, CA, and the Camelback Inn in Scottsdale, AZ, having these sub-dubbed JW Marriott. "When you look at the position of JW as a brand, as an authentic collection of signature hotels, it is not designed to be 'cookie-cutter'; it's meant to deliver to the consumer who purchases the brand that each one is authentic."
Chains' loyalty programs are powerful incentives to remain inside the fold. "Brands give you points for the planners, organizations, and guests," says Kevin Jetton, president, GeniSys Consulting Services, in San Antonio, TX, "as well as upgrades based on status [through Hilton HHonors, Starwood Preferred Guest, and Marriott Rewards]."
The Brand Is the Promise
Brian Richardson, Fairmont's VP of brand management, argues against brand subordination: "Our naming convention is to add Fairmont as a prefix. It recognizes the value of the property, it preserves the iconic name, and all the value that comes with that, while linking it to a brand." Iconic resorts now featuring the Fairmont brand include the Fairmont Banff Springs in the Canadian Rockies, the Fairmont Scottsdale Princess, and the Fairmont Turnberry Isle in south Florida. "I think there is value in people understanding that these iconic properties are linked to a brand. All the research I've looked at says people still value brands and still buy brands. A brand is a set of promises as to the way the company behaves."
Jack Schmidt, chief marketing officer for Benchmark Hospitality, looks at the promise from another angle: "Rather than standardizing, we are a company of best practices." Benchmark, which manages more than 30 conference centers, including Turtle Bay Resort in Oahu, HI, and the Eaglewood Resort & Spa in Itasca, IL, finds brand subordination a non-issue. "The Benchmark brand is presented as sort of an 'Intel Inside,' " says Schmidt, "Customers in the meetings segment can relate to Benchmark, but we don't homogenize our properties. They're all very different and unique." Says The Broadmoor's Bartolin, "There are a lot of pluses to branding, but it becomes a little homogenized; there's some sort of sameness in the customer's mind."
Even so, when it comes to competing with major chains—with global distribution systems and other economies of scale—Bartolin admits it's not easy. Still, at The Broadmoor, "there's never been any consideration of a branded management. We are fiercely independent, and that works for us. The Broadmoor is iconic, it's one of a kind. That's what allows us to get away with that."
Webbin' Changes Everything
"The Internet has leveled the playing field for independent and smaller properties," says Bartolin. "From that perspective, we're as accessible as anyone else." Schmidt agrees: "If you go back 10 years ago, people were unable to book to the extent they are today. The Internet became an effective resource for us to distribute our product; where before only your larger major chains really had effective access to the global distribution network. We're right out there, appearing right next to the major chains." Even better: "We allow our individual properties to tell their own story online, whereas many of the major chains have to—for consistency and processing purposes—limit each of their properties to a presentation that's consistent with all their other properties."
But while planners might like trying an independent property, most agree a site visit is needed. Says Steve Collins of Resort Meeting Source, LLC, in Breckenridge, CO, "If I am planning a meeting where I know we will be conducting site visits, I will look for non-flagged hotels to include in the bidding process—particularly if they offer more of a local 'flavor' in the given market."
Having It Both Ways
If the Internet makes it easier for independents to promote their individuality, it doesn't stop major chains from doing the same for selected properties; like LXR, the Waldorf=Astoria affiliation—and certainly the Hilton name—is downplayed at the property level. But make no mistake: It's still branded. "Conrad Hilton called the Waldorf=Astoria 'the greatest of them all.' We wanted to extend that kind of pride and sense of proprietariness to a greater brand than to just one hotel," says Greydanus. And, "we really needed a brand to park these very large distinctive resorts."
Customers like having it both ways, too. Peter Huggins, planner for the American Chemical Society in Washington D.C., says, "While I often lament the fact that many of the grand hotels are now part of corporate chains, the streamlining of the industry has helped me greatly. I do enough programs that I often need to check the nuts-and-bolts features of properties in a certain city or region. The corporate sites (Starwood, Marriott, Hilton, InterContinental) really facilitate this process."
Is the "unbranding" phenomenon just a masquerade for another segmentation of the market? Maybe. "This industry has done a great job of branding and segmenting," observes Schmidt. "Now, we're trying to use branding as a way to break through the clutter that we've created as an industry."