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A Vivid Imagination

Best Western Details Brand Expansion Strategy, Growth Plans At Annual Conference

Friday, November 10, 2017
Dennis Nessler
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NASHVILLE—Imagine was chosen as the theme of its annual conference this year, but it may better represent what Best Western Hotels & Resorts did several years ago as it set out to expand its portfolio of brands.
President and CEO David Kong effectively tied the theme and the company’s recent efforts together with this year’s event, which was held at the Gaylord Opryland Resort & Convention Center here.

“We’ve had an exciting resurgence at Best Western the past few years all as a result of us honoring our past and reimagining our future,”said Kong.

That reimagining has taken the company from one brand to 11in just six years time, according to Best Western Board Chairman Terry Bichsel,who noted, “we’re competing, we’re in the game and we’re making noise.”

Kong further explained the expansion to Hotel Interactive®. “I think all hotel companies need to grow. What you don’t want to see happen is you get left behind because you don’t have scale. When you have scale you can do a lot of things,” he noted.

The most recent addition to the company’s lineup is the BW Signature Collection, an upper-midscale soft brand that was announced last week. Kong detailed the potential benefits of the brand and began by pointing out that soft brands are “all the rage and for good reason.”

He further noted, “It is the only soft brand in the upper-midscale segment, I think we would have that first [entry] advantage for a while. It’s a big universe, we count about 20,000 hotels that could be good for this soft brand.”

In terms of gaining distribution for the brand, Kong stressed quality over quantity.
“We’re less interested in how many we sign up right away,but more in making sure every one we sign up meets our requirements,” he said.

Meanwhile, Ron Pohl, SVP/COO, also touted the potential of the BW Signature Collection. “I think that’s the fastest growing pipeline that we will see in the years to come,” he said.

Pohl noted much of the impetus for the brand came from the company’s affiliates in Europe—where many of the hotels are independent—as well as the void in the market for upper-midscale soft-branded hotels and a number of members with properties that were falling short of the designation for BW Premier Collection, the company’s upscale soft brand.

But Kong acknowledged that while the company has filled in many of the gaps that existed in its portfolio, there is plenty of work to be done. “Well we can have the selection right now, but we don’t have the critical mass yet in some of those segments. We might have filled up most of the boxes in the table,but we need to ramp up the scale,” he said.

And the company is working toward doing just that with a robust pipeline, according to Pohl. There are some 549 hotels under construction globally, 290 of which are in North America. Kong, meanwhile,noted that some 40 percent of the company’s approved applications are for new brands.

The CEO added that Best Western’s Vib brand now has 18approved applications in North America and expects the first two to open in a few months. Meanwhile, the Glo brand has roughly 30 in the pipeline in North America and three under construction.

The company’s SureStay economy brand has 28 properties open and an additional 19 in the pipeline, and the BW Premier Collection has some 73properties open globally.
Pohl, meanwhile, offered members a limited time offer for those signing up to develop hotels. While he couldn’t reveal the exact terms he did note that the all-in price for most Best Western properties is typically less than 5 percent in fees and “we’re going to take a percentage point off of that.”He added that members are being asked to let the company know where they are interested in developing and what brand and “we’ll bring the deal to you.”
One of the company’s stated goals has been to increase the impact of its loyalty program. Kong noted that some 44 percent of total rooms revenue this year has come from the BW Rewards loyalty program.

He added, “that’s within striking distance of being the best program in the industry.” In addition, Kong noted that this year BW Rewards will deliver over 1.7 billion in revenue to hotels in North America.

In addition, during the conference the brand unveiled Experiences by Best Western Rewards, a new element designed to provide members with one of a kind experiences in destinations around the world. BWR members can experience travel beyond the ordinary by using their points on rewarding experiences, such as a trip to Walt Disney World in Orlando, FL, for example.

Pohl offered an update on the company’s new supply direct platform, Birch Street, which is designed to improve the procurement experience. The first phase of the program has been piloted by 100 hotels and is now available to all hotels through mybestwestern.com. The company has begun working on phase 2 of the program.
On the technology front, Best Western has introduced a guest engagement platform, which includes text messaging and mobile check-in and has been piloted by nearly 400 hotels. In addition, the company has begun testing Amazon’s Alexa through an iHome device, according to Pohl.

Pohl also announced the company had finalized a partnership with Hunter Amenities on a line of bath products for all Best Western brands.He noted the company was looking to leverage its massive buying power to get the best price. “We wanted to offer a unique and upgraded branded product for all of our guests,” he said.

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Dennis Nessler    Dennis Nessler
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