BROOMFIELD, Colorado and HENDERSONVILLE, Tennessee—As a complement to our research article, “The length of brand affiliations across chain scales,” that details the average length of an affiliation over time, this visual provides a historical look over time to put the franchise change data into perspective.
Rather than looking at specific flags, we focus on chain scales and give the reader a sense of how the U.S. lodging environment is changing over time, as hotels not only change flags but also scales. The initial assumption is that if hotels change scales, they would normally move to a lower-priced scale. Our data reveals that is mostly true, but not always. That said, the majority of hotels stay within scales when the franchise affiliation changes.
The way to read the below graphic—a Sankey diagram (or, as it’s sometimes called, spaghetti chart)—is to start at the top, reading from left to right the percentages that each scale makes up of the total U.S. room inventory. For example, 17.1% of all rooms were upper-midscale rooms; but clicking on the scale reveals how properties with the upper-midscale segment changed affiliations and scales over time. So, 1,175 hotels opened with an upper-midscale chain affiliation and then changed to a midscale chain; 134 hotels that operated as upper-midscale closed. The chart does not give insights into affiliation length—only that the affiliation changed.
The chart makes no allowances for new supply, so all chain scales decline in share, whereas the number in the “closed” category increases steadily. This is, of course, only partially true since the industry continues to grow and new hotels are being added to all chain scales all the time.