Choice Hotels execs see steady progress for brands
 
Choice Hotels execs see steady progress for brands
10 MAY 2017 8:45 AM

The Choice Hotels International annual convention kicked off with development announcements as well as a review of the company’s efforts over the past year.

LAS VEGAS—Choice Hotels International led up to its 63rd annual convention with a number of company announcements and developments, including an aggressive pipeline strategy for its flagship brands and a new extended-stay guestroom prototype.

Among the company’s several announcements ahead of and during the conference, Choice Hotels shared its strategy to open 56 new Comfort branded hotels across the U.S. Attendees will also learn about the brand’s new MainStay Suites room prototype, which includes an open-concept community room and outdoor living area, according to a news release.

In welcoming attendees to the conference, Choice Hotels CEO Steve Joyce and President and COO Patrick Pacious shared the company’s efforts over the past year.

An eye on Washington, D.C.
With the new Donald Trump administration, Choice Hotels is hoping for a business-friendly approach by the government, Joyce said. Part of that is a promise for income tax reform, he said, and should that come through, now might be the ideal time to begin developing.

“When tax reform becomes a reality in your future, you will want to be ready,” he said.

Congress has been grappling with certain changes to the proposed American Health Care Act, Joyce said, and legislators need to do some more work and hopefully they will get some good results. Choice Hotels will continue to work with Congress and the administration to obtain the best system for franchisees, the hospitality sector and the country, he said.

Recent decisions regarding the joint-employer rule have put the industry in a position that would force franchisees and franchisors to be considered as joint employers, Joyce said, but efforts to reverse those decisions are seeing results. The current administration is rolling back some of the regulations that have become a burden to small businesses, he added.

The U.S. Department of Labor’s decision to change the overtime salary threshold was “an ill-conceived, one-size-fits-all regulation,” Joyce said, but the good news is that a federal court issued an injunction before it could take effect in December 2016. He said he doesn’t expect the administration to move forward on that change, and he’s waiting to see how the labor department will rework it.

Fighting back against OTAs
Online travel agencies have become more aggressive in their tactics, Joyce said, referring to when some dimmed hotel search results last year before the hotel industry cried foul. The OTAs have benefited from the misconception their sites have the best rates available, he said, and while continuing to fight that notion, Choice has worked to top online travel scams that hurt guests.

Because Expedia and Priceline own almost every OTA site out there, guests don’t realize going to different OTA websites means they’re really not shopping around, Pacious said. Choice’s national advertising campaign, “Badda Book. Badda Boom,” is designed to persuade guests to book direct for the best rates is seeing results, he said. The OTA growth rate has slowed in recent months while bookings through the brand’s websites continue to grow.

Expanding the book-direct strategy is key to moving forward for both consumers and franchisees, Pacious said, since the direct booking channels are hotels’ lowest-cost and highest-profit channels, he said. Choice Privileges reward program membership is up 17% from last year, he said.

Systemwide benefits of upscale
A strong upscale business can help the entire brand family, said Janis Cannon, Choice’s SVP of upscale brands. The company has had experience with upscale brands internationally through Clarion and the Ascend Hotel Collection, she said, and now it has Cambria as well. There are almost 350 Choice-branded upscale hotels around the world, and another three Cambria properties are opening this month, including Cambria’s first property in California, the Cambria Hotel Los Angeles - LAX.

“We have arrived,” Cannon said. “Upscale is here to stay.”

Choice Hotels’ success in the upscale segment benefits every brand and every single hotel by driving rates, attracting corporate rates, attracting midweek business and developing and applying new technology, she said. It helps raise awareness of Choice in every chain-scale segment and every guest segment, she said.

“We’re providing guests options at all price segments,” Cannon said. “We keep guests in the Choice family. No matter why they travel, where they want to go or how much they want to pay for a room. We’re giving each guest the kind of experience the brand promises—period.”

Look for more coverage from the 2017 Choice Hotels conference as it unfolds.

Editor's note: Choice Hotels International paid for hotel accommodations and entertainment. Complete editorial control was at the discretion of the Hotel News Now editorial team; Choice Hotels had no influence on the coverage provided.

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