For the aboriginal time in its 70-year history, a captivated Best Western Hotels & Resorts is accepting into the authorization business by applying a commonly retail business — white labels — to the auberge industry.
Similar to how some manufacturers adeptness advertise a white-label artefact to assertive retailers, SureStay Hotels Group will be a white-label auberge product. SureStay will accomplish as a abstracted accessory of Best Western, acceptance individual hotel owners to accept admission to Best Western’s basement (sales, marketing, acquirement management, training, their own website, etc.) and administration channels, after accepting to attach to stricter Best Western auberge standards or pay as abundant as they would for a administration agreement.
There’s no acknowledgment of Best Western in any of the hotels, and SureStay will additionally accept its own website and adaptable app.
Within SureStay, there are three brands to accept from — SureStay Auberge (Premium Economy), SureStay Plus Auberge (Lower Midscale) and SureStay Signature Collection (Midscale Soft Brand).
Of the name, CEO David Kong told Skift, “These segments don’t accommodate abundant affirmation to consumers out there — there’s no abundance or advance because it’s basically a amount buy. We accept to differentiate ourselves through above chump affliction and accommodate that advance whether it’s through TripAdvisor ratings or our SureStay Promise.”
According to Kong, SureStay’s barrage has a lot to do with scale. At the moment, Best Western has 4,100 hotels in added than 100 countries, advance out over seven altered brands, best of which are midscale to upscale. But there’s consistently an befalling to grow, abnormally in the abridgement space.
“If you accept a lot of hotels you accept added acquirement to absorb — bigger support, investments in technology and added sales and marketing, and greater amount efficiencies because of economies of scale,” Kong told Skift. “With added hotels, you can accommodate bigger bureau acceding with OTAs [online biking agencies]. There are huge allowances to scale.”
Kong said, “If you attending at the auberge cosmos out there, there are 17,000 branded and 12,000 unbranded hotels in the abridgement and midscale segments. That’s a huge cosmos and abeyant for us to tap into.”
He said SureStay was advised to be a “migration path” for hotels that appetite to be added absolute after accepting to accommodated Best Western’s architecture requirements or cast standards but “still acquisition a home aural the family.” And because there are some risks to entering the abridgement segment, and apropos about compromising Best Western’s added brands’ images and equity, the aggregation absitively to accompany the white-label admission instead.
“This advertisement is adventurous in several ways, a brace of firsts in the industry,” Kong said. “It’s the aboriginal time we are accomplishing franchising and borer into the abridgement segment. It’s adventurous in abounding ways.”
SureStay’s claiming will be to get a franchisee auberge to accept it over addition advantage for abridgement to midscale hotels, like Choice Hotels’ EconoLodge or Sleep Inn or Wyndham’s Super 8 or Canicule Inn brands.
“In our case, it’s a nice niche,” Kong said. “Our fees are activity to be appropriate in the middle, but Best Western has had such acceptable success alive acquirement to our hotels, and we’re accepted for our support, training, education, acquirement management, and accretion — all these casework that we provide. The hotels that are aing SureStay will account abundantly from that relationship. They can calculation on the award-winning acquirement engine, our above sales and marketing, and our abutment through Best Western and they don’t accept to pay a lot. They save a lot on OTA [online biking agency] commissions.”
“We accept a altered fee model,” Kong explained. “Best Western is a associates affiliation so our associates fee has a anchored per allowance fee. SureStay is a fee archetypal that’s for profit, it’s a allotment of gross allowance revenue.”
To authorize for SureStay, hotels charge to admission and advance a TripAdvisor account of 3.5 or college and attach to the SureStay Service Promise, which isn’t a acreage advance plan, but ensures that franchisees always advance their backdrop to assertive standards of quality. They additionally accept to accede to unannounced inspections and some brand-wide standards that chronicle to things like the blazon of TV, accelerated Internet connection, and breakfast. “Things that are absolutely important to today’s travelers,” said Kong.
The authorization acceding that franchisees assurance to be a allotment of SureStay additionally adheres to the Asian American Auberge Owners Affiliation Fair Franchising Principles. These accommodate options for aboriginal abortion dates with no asleep damages, the adeptness to sue the vendors of their choosing, aegis from competition, and accepting a articulation in the administration of the brand. “We appetite to assignment with them as a accomplice to advance things for them,” Kong said.
Another acumen why franchisees adeptness be fatigued to SureStay, he said, additionally relates to the befalling for accumulated biking contracts.
“To alpha a cast from blemish is absolutely difficult,” Kong said. “We’re accomplishing aggregate we can to accomplish abiding those hotels are awful successful.”
A contempo case in point from Best Western’s own portfolio is its midscale burghal bazaar auberge brand, Vib. Originally appear in October 2014, there were eight backdrop beneath development as of March 1 that are accepted to accessible by the end of this year, and eight added in the pipeline.
By comparison, Hilton’s midscale, Millennial-friendly Tru by Hilton brand, which was appear this January, already has 120 hotels in the activity and the aggregation expects its aboriginal auberge to accessible by aboriginal 2017. Like SureStay, it additionally operates on a authorization model.
To animate franchisees to assurance agreements, SureStay Hotels is giving appropriate incentives to the aboriginal 100 hotels and will additionally accommodate all-encompassing support, abnormally during their aboriginal 100 days.
As of Sept. 30, Kong said Best Western had 20 alive belletrist of absorbed and back announcement SureStay at The Lodging Conference aftermost week, Best Western has 700 alive leads. The aggregation hopes to accept 150 hotels online aural three years and 800 by 2026.
Further ahead, Best Western will additionally accept to adjudge if it will eventually accord its 26 actor Best Western Rewards adherence associates admission to acquire and redeem credibility at SureStay. Kong said they haven’t fabricated a accommodation aloof yet as to whether the Best Western Rewards affairs and the SureStay adherence affairs will be accumbent to acquiesce for added accretion and earning opportunities.
“[That idea] seems to actualize synergies and, therefore, allowances but we charge to delay about a year or so to accept that conversation,” he said.
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Photo Credit: A apprehension of a SureStay Hotel. SureStay Hotels is a new “white-label” abridgement cast from Best Western. Best Western Hotels & Resorts
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