NEW YORK CITY—Debates over definitions for fuzzy terms such as “boutique,” “soft brand” and “collection” are muddying the waters for the word “independent” as well.
Think it’s simply the opposite of a branded hotel? Think again, said panelists at last month’s NYU International Hospitality Industry Investment Conference.
“The opposite of an independent hotel is not a branded hotel. Look at the Baccarat. That has a brand associated with it, but it clearly is an independent hotel. Look at the (Nickelodeon Suites Resort) in Orlando. Look at the (Palazzo Versace). They have brands associated with them, but they’re still independent hotels,” said Karen E. Rubin, senior VP, global development policy and feasibility, Starwood Hotels & Resorts Worldwide.
The company has three soft brands—or collections, as Starwood executives use the term interchangeably—including the Luxury Collection, the Tribute Portfolio and Design Hotels AB.
“I would propose that the opposite of an independent hotel is a chain-affiliated hotel” or affiliated with a distribution or loyalty program, Rubin said.
The 650 properties affiliated with Preferred Hotels & Resorts? Independents, every one of them, said the group’s president and CEO, Lindsey Ueberroth.She counts Preferred as a soft brand, which itself comprises five distinct collections.
Jay Stein, COO of Hampshire Hotels Management, said an official definition for the term “independent” is meaningless. What counts is whether a guest views a property as such.
“We don’t make that distinction. The consumer makes that distinction,” he said.
The group’s Chatwal hotel in New York City is part of Starwood’s Luxury Collection, but most guests view it as independent, Stein said. It’s one-of-a-kind, he added.
Asked whether a handful of hotels that fly under the same flag can be viewed each as independent, Stein again pointed to consumer perception. Many guests still think of hotels within Kimpton Hotels & Restaurants (which is now part of InterContinental Hotels Group) as independents, he said, and there are more than 60 of them.
The same is perhaps more true for brands such as Montage Hotels & Resorts, of which there are five open, Ueberroth said.
Michael Tall, president and COO of Charlestowne Hotels, had a slightly more literal interpretation.
“If nobody has the ability to enforce anything upon you … then you’re independent,” he said, referring specifically to brand mandates and standards.
Within that context, hotels within the Preferred Hotels portfolio, which has certain quality standards, are independent, while those in the Luxury Collection, which has certain mandates, are not, Tall explained.
Vijay Dandapani, president of Apple Core Hotels, which within the past decade deflagged several hotels within its portfolio, once again brought the conversation back to guests.
Guest who stay at branded hotels are typically different than those who stay in independents, he explained. One key difference: Those who seek out the former are there to earn (or redeem) points, he said.
Shaking negative connotations
Decades ago, independent hoteliers flocked to the safe confines of brands to convey consistency and quality to guests, Rubin explained.
That need largely has been supplanted by the Internet and sites such as TripAdvisor, panelists agreed.
“The Internet and social media has completely changed rating scales, whether you can hide or falsely present a brand or image,” Tall said. “It has completely shot through that.”
Consumers are more comfortable than ever before in booking with independent hotels—however one defines them, panelists said.
That said, “independent” can be something of a dirty word in the low-end of the market, Stein admitted.
“In the higher end of the market,” he added, “it tends to be a selling proposition.”
Investors are now less scared of independent hotels as well, Stein said. Whereas in the past a brand provided global distribution and market support, hoteliers now can gain the same visibility on any number of distribution platforms and online travel agencies.
Does the affiliation model still work?
Panelists were asked whether the rise of such a robust online distribution landscape has rendered brands and affiliation models moot.
Not quite, Preferred’s Ueberroth said.
Yes, OTAs can increase your visibility, but chains and affiliation networks still provide more resources and access to more customers, she said.
That global infrastructure, combined with other economies of scale as well as consulting support, makes the affiliation model a must for many owners, Ueberroth added.
Rubin injected a bit of context into the conversation.
“The market right now is really good. … My question is, for those experimenting with independence today, what happens when things aren’t so good? … In many cases—not all, but in many cases—a chain affiliation can help you through the downtimes,” she said.