[Hotel Executive] Eli Karakachian (SHA ’18) explores hotel brand proliferation and its impact on customers
For hotels, regularly increasing its brand portfolios means new revenue streams and reaching a variety of customers, but it is useful for customers or does it just cause confusion? Eli Karakachian (SHA ’18) explores the topic in a recent article co-authored with Tom Engel, School of Hospitality Administration Advisory Board President and president of T.L. ENGEL Group.
“Are companies catering to different target markets or towards hotel developers in order to collect more fees and increase revenue?
Some may even argue that the reason to build more brands arises from the costs associated with having to remodel an already existing brand. In the last few years, The Ritz-Carlton, Holiday Inn, and Best Western chains have all turned to refreshing their logos and visual assets amidst other rebranding activities. However, these companies put a great deal of faith into their existing customers and those that the brands already lost. Updating on such a large scale can be costly and risky. Companies can never be certain that they will regain their lost consumer. Have many companies resorted to creating new brands in order to save them from the hassle of refreshing their older existing ones?
Still, does branding for the sake of revenue degrade the equity that the core hotel company has tried to build? Research actually suggests that consumers simply stop buying and begin to look for the simplest solution or channel.”