Panelists: Pros of dual brands outweigh cons
 
Panelists: Pros of dual brands outweigh cons
23 SEPTEMBER 2016 8:01 AM

Making dual-brand hotel projects succeed requires attention to detail, which can pay off for guests and owners. 

NASHVILLE, Tennessee—Dual-brand hotel development has been established as a viable investment for several years, and as the product class evolves, owners and brands become more knowledgeable about how to build and operate them to maximize efficiency.

Speakers on the “Two brands, one building” panel at the Hotel Data Conference set the scene by acknowledging that different companies have different strategies when it comes to executing dual-branded hotels and adhering to brand standards. For some, it’s about creating two smaller versions of hotels in one footprint to capture extra demand; for others it’s about co-locating two or more properties on one piece of land with some connection points; and for others it’s about stacking brands in a single building.

Regardless of execution, speakers said dual-branded projects can lead to savings in staffing, maintenance and more, provided owners and operators pay attention to the details.

The benefits of co-location
Speakers said there’s no one-size-fits-all mentality for how these hotels are set up, but that dual branding often can allow owners to capitalize on the money saved by offering extras guests might not get in single-branded versions of the same hotel brand.

Bill DeForrest, president and CEO of Spire Hospitality, cited his company’s recent project, a dual-brand Crowne Plaza and Staybridge Suites in Midtown Atlanta, which is vertically arranged into 18 Crowne Plaza floors and six Staybridge floors.

“We were able to enhance both the hotels because of the shared services,” he said. “We built a 1,500-square-foot fitness center both can use. We included the Staybridge-standard outdoor experience, which Crowne Plaza customers wouldn't normally have access to, but they do. The Staybridge market is usually small, but we were able to build a much larger one here.”

Judy Cluck, VP of sales and marketing for LBA Hospitality, agreed that the ability to enhance both brands is key. She cited her company’s dual-branded Hampton Inn and Home2 Suites by Hilton hotel in Huntsville, Alabama. The company was not only able to offer a larger combined fitness center for the two hotels, it also increased the meeting space, allowing more revenue generation.

Martha Lomanno Glose, manager of market information for Choice Hotels International—which offers dual-branded Sleep Inn and MainStay Suites hotels—said Choice finds ways to enhance the guest experience by offering the best of both brands. Choice keeps both brands under one roof with every space shared except guestrooms, and it applies the stricter brand standards to the public spaces. It also offers certain brand standards—like the oatmeal on the breakfast menu at MainStay Suites—to all guests.

In the early days of dual branding, some worried that hotels wouldn’t be able to keep guests where they belonged in a dual-branded property. That way of thinking isn’t relevant anymore, Cluck said.

“We’ve learned that you can’t stop guests from intermingling,” she said. “They’re going to go check out the other side, they’ll explore. It’s a natural progression and it’s fine.”

She said most operators have learned the benefits of educating guests when they check in about which services are shared and which aren’t—which is often the case when one breakfast is free and one is paid—but in most cases, intermingling can be advantageous.

For example, DeForrest said it’s a great draw to see the Staybridge Suites extended-stay guests getting comfortable at the Crowne Plaza bar.

“They really help bring that particular brand experience alive,” he said. “When guests take advantage of shared services it improves the overall perception of certain brands.”

Sales and marketing
Speakers agreed that combined sales, marketing and operations efforts are where the savings really come alive in dual-branded hotels.

“That flexibility of being able to capture different types of demand in a market is great,” Glose said. “We can pick up different types of guests and demand based on what their needs are.”

Cluck said dual brands offer flexible options for guests when it comes to pricing, and flexibility when it comes to selling.

“We can go out in the market and speak with our clients about two great options with enhanced shared services,” she said.

DeForrest said having dual-branded properties appeals to corporate clients as well.

“Our big clients have all sorts of needs,” he said. “AT&T, for example, does a lot of training, so extended stay is important. Then they do meetings, so they have those as well. It’s not just having the ability to go after different clients with these hotels—it’s a way to work with your best clients to be the solution for all their needs.”

On the staffing side, Cluck said LBA has seen savings by cross-training employees across both brands. That way when employees call off, it’s easier to make staffing shifts when everyone is trained.

“Because we do our team huddles every day together, we have the opportunity to collaborate and know what’s going on at both hotels,” she said.

DeForrest and Glose agreed that back-of-house shared services like human resources, engineering and maintenance result in significant savings.

The challenges of dual branding
Dealing with brand confusion can become an issue, speakers said, especially with groups where part of the group is staying in one brand and part in the other.

“Say you are booking some overflow, and one family in town for a traveling sporting event gets a suite and the others don’t? How do you handle that?” Glose asked.

Cluck said it’s all about being exceptionally mindful when quoting rates and explaining the differences to guests when they book, particularly when it’s a group.

Technology can be a challenge as well, particularly when it comes to merging payment systems, or giving guests the ability to bill services to their rooms, like in bars and restaurants.

“We had to modify our POS and PMS so we could do everything we thought guests would want to do, like sign a bar tab from the Crowne Plaza to their Staybridge room,” DeForrest said. “You have to take the time to think about it.”

Addresses prove to be another interesting challenge.

“We learned from the city that we had to get a second address for both hotels,” DeForrest said. “If you ask an Uber driver to take you one place, you may get dropped off far away from the lobby where you’re supposed to be.”

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