Best Western: New boutique brands in owners’ sweet spot
 
Best Western: New boutique brands in owners’ sweet spot
26 SEPTEMBER 2018 8:03 AM

Boutique brands Sadie and Aiden will provide owners the opportunity to eliminate artificial rate ceilings in the upscale and upper-midscale segments, respectively, according to David Kong, Best Western’s president and CEO.

PHOENIX—Best Western Hotels & Resorts is adding two boutique brands to its portfolio as it seeks to attract conversion opportunities to its development pipeline.

Sadie Hotel, which the company said will compete in the upscale segment, and the upper-midscale Aiden Hotel brand bring Best Western’s portfolio to 13 brands.

David Kong, Best Western’s president & CEO, said during a launch reception that the brands were borne out of the difficulty of new construction.

“For Best Western to grow scale, we have to focus on conversion opportunities,” Kong said. “But to do conversion properly, we have to be able to tell a good repositioning story.”

That repositioning story revolves around helping hotel owners increase occupancy, average daily rate and revenue per available room, Kong said.

“In other words, we have to help the asset owner enhance the value of the asset.”

Unique identities
In a separate interview with Hotel News Now, Kong said the Sadie and Aiden names allow guests to relate to them on a personal basis because they have their own identities. (Watch a video interview with Kong below.)

Those identities are etched in design that will make each hotel unique, according to Kong and Amy Hulbert, Best Western’s VP of boutique and upscale brands.

Potential conversion candidates include warehouses, lofts and midscale hotels ripe for repositioning with a little F&B and some great design, she said.

“Sadie and Aiden bring a huge energy to their design,” Hulbert said. “The architecture is crisp. It’s contemporary, but the real showstopper is the signage. The signage is theatrical, very dramatic both day and night. It’s very dimensional. … This is a building you know is different from the moment you arrive.”

“Design is really important,” Kong said. “We want to make every hotel different. We want to work with the owners to achieve that owner’s vision of what the hotel should look like.

“We want the hotel to capitalize on the local flair that’s out there,” he added.

Sweet spot
A key component of the brands is the opportunity for increased average daily rates, according to Kong. Best Western’s research indicated boutique hotels are gaining a lot of momentum, largely because they remove the artificial rate ceiling that many hotels experience.

“For example, if someone was trying to stay at a Best Western Plus hotel, he might be researching rates, and he might be comparing that rate to Hampton or Holiday Inn Express,” he said. “Automatically, a Best Western Plus, Hampton or Holiday Inn Express have a rate ceiling because people compare all those products. But for a boutique hotel, because it offers such a unique experience, there’s no rate ceiling. People just don’t know how much to pay for that experience. You remove the rate ceiling, therefore (the hotel) has the authority to (increase)* the rate premium.”

Best Western chose Aiden for upper midscale and Sadie for upscale because they fall within its sweet spot, Kong said.

Those segments, along with midscale, have the largest concentration of hotels, so therefore they have the largest opportunity for conversion, Kong said. They also have the largest number of independent hotels, which are prime candidates for repositioning.

“We want to help hotels that already have to spend money on renovation,” Kong said. “They have to spend the money anyway … they may as well make it a boutique hotel and make it an experience.”

Kong said two other components will make the brands successful: a fast ramp-up period and the creation of a constant buzz through social media engagement. Best Western has the second highest social engagement scores in the industry, according to the CEO.

F&B engagement
The lobby, which will not include traditional front desks, is where the buzz will happen for both brands, Hulbert said.

“That barista and bartender is your concierge for the hotel,” she said. “They can help your guests with keys, they can give your guests direction, but they also make a mean cocktail and a perfect latte.”

The food-and-beverage component is essential to the success of both brands, the executives said.

“Every Sadie and Aiden will have a bar component,” Hulbert said. “That bar drives revenue. That’s a huge revenue generator for us, but it does something else. It activates the lobby. The food-and-beverage component adds a layer of activity to that lobby that nothing else really can.”

In addition to Sadie and Aiden, Best Western’s brand portfolio includes: Best Western, Best Western Plus, Best Western Premier, Vīb, GLō, Executive Residency by Best Western, BW Premier Collection by Best Western, BW Signature Collection by Best Western, SureStay Hotel by Best Western, SureStay Plus Hotel by Best Western and SureStay Collection by Best Western.

*Clarification, 26 September 2018: This story has been updated to correct the context of a quote.

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