Jan152012

Hilton, Marriott and IHG Hotel Brand Market Segments

Over the next few weeks I will compare aspects of different hotel loyalty programs. While it is easy to look at the different websites and compare member benefits, the proportion of hotel brands and their market segment as a proportion of hotels participating in a hotel loyalty program tends not to be as well known.

Hotel Chain Scales are used by hotel industry analysts at STR.com to segment hotel brands into luxury, upper-upscale, upscale, upper midscale, midscale and economy categories.

The largest hotel loyalty programs for the US are Hilton, Marriott and IHG in terms of the size and broad range of hotels in different market segments. Wyndham Rewards, Choice Privileges and Best Western Rewards are comparable megachain hotels, but there are far fewer hotels in the upscale to luxury segments in these three brands. Starwood (1,100 hotels) and Hyatt (500 hotels) have a high proportion of upscale to luxury hotel brands in their portfolios, however, the number of hotels are far fewer in these chains and not as useful for travelers needing wide geographic coverage.

 

Hotel Brands and Market Segments

What is a luxury hotel or an upper-upscale hotel?

Price is generally the defining line between hotel market segments. I do not work in the hotel industry and I am an amateur analyst interpreting numbers from hotel industry data. STRGlobal.com provides industry data reports and I gather statistical data about the hotel industry regularly from the free data provided online.

STR has a list of hotel brands in different chain scale segments based on the average room rate data for thousands of hotels worldwide.

This post uses the 2011 STR US Chain Scales  along with the latest hotel properties data for each brand from the hotel chain’s websites to compare market segments for hotel brands of Hilton, IHG and Marriott.

Basically I want to see how the hotels in Hilton, IHG and Marriott segment out in each chain and compare to each other when looking at the number of luxury, upscale and midscale hotels in each hotel loyalty program.

Hilton Worldwide Hotel Brands with Market Segment and Number of Hotels

  • Hilton Worldwide has 3,712 hotels in this list, but this is only an estimate. New hotels open every few days.The percentage of hotels in each brand is listed in ( ).
  • Conrad Hotels (luxury) = 18 hotels (<1%).
  • Waldorf Astoria Hotels & Resorts (luxury) = 23 hotels (<1%).
  • Hilton Hotels and Resorts (upper upscale) = 540 hotels (15%) in 78 countries including 70 Resorts.
  • Embassy Suites (upper upscale) = 201 hotels (5%) with 193 in US and 8 international.
  • Hilton Grand Vacations (upper upscale) = 50 properties (1%).
  • DoubleTree by Hilton (upscale) = 250 hotels (7%) in 17 countries.
  • Homewood Suites (upscale – extended stay) = 309 hotels (8%) in North America.
  • Hilton Garden Inn (upscale) = 515 hotels (14%) with 130 in development.
  • Hampton Inn (upper midscale) = 1,800 hotels (48%) with more than 1,700 in US and growing international expansion recently.
  • Home2 Suites (upper midscale – extended stay) = 6 hotels (<1%).

 

Marriott International Hotel Brands with Market Segment and Number of Hotels

  • 3,747 properties in 13 brands in 72 countries. This total does not include Marriott Executive Apartments which earn Marriott Rewards points, but are extended stay contracted properties and not a typical hotel stay.
  • Ritz-Carlton (luxury) = 81 hotels (2%).
  • JW Marriott (luxury) = 62 hotels (2%).
  • Marriott Hotels & Resorts (upper upscale) = 521 hotels (14%).
  • Renaissance (upper upscale) = 160 hotels (4%).
  • Autograph Collection (upper upscale) = 29 hotels (<1%).
  • Marriott Vacation Club (upper upscale) = 59 properties (2%).
  • Marriott Conference Centers (upper upscale) = 7 hotels (<1%).
  • Courtyard (upscale) = 926 hotels (25%).
  • AC Hotels (upscale) = 82 hotels mostly in Spain (2%).
  • SpringHill Suites (upscale – extended stay) = 299 hotels (8%).
  • Residence Inn (upscale – extended stay) = 627 hotels (17%).
  • Fairfield Inn (upper midscale) = 689 hotels (18%).
  • TownePlace Suites (upper midscale – extended stay)= 205 hotels (5%).

InterContinental Hotels Group

  • 4,452 hotels (as of September 2011)
  • InterContinental Hotels (luxury) = 171 hotels (4%).
  • Crowne Plaza (upscale) =  401 hotels (9%).
  • Hotel Indigo (upscale) =  38 hotels (<1%).
  • Staybridge Suites (upscale – extended stay) = 195 hotels (4%).
  • Holiday Inn (upper midscale) = 1,238 hotels (28%).
  • Holiday Inn Express (upper midscale) = 2,103 hotels (47%) with 1,866 in Americas.
  • Candlewood Suites (midscale) = 300 hotels (7%).
  • Holiday Inn Club Vacations = 6 properties (<1%).

I have some issue with the broad segmentation of Crowne Plaza and DoubleTree as Upscale rather than Upper Upscale for some locations and Holiday Inn as Upper Midscale for some locations where the Holiday Inn is more upscale.  Keep in mind in the real world of travel there will be some Crowne Plaza and DoubleTree hotels that will be just as nice or better than the nearby Marriott, Hilton or Embassy Suites.

How the hotel chains stack up when brands are compared by market segment.

Luxury market segment

  • IHG = 171 hotels (InterContinental)
  • Marriott = 143 hotels (Ritz-Carlton, JW Marriott)
  • Hilton = 41 hotels (Conrad, Waldorf Astoria)

Upper Upscale market segment

  • Hilton = 791 hotels (Hilton, Embassy Suites, Hilton Grand Vacations)
  • Marriott = 776 hotels (Marriott, Renaissance, Autograph Collection, Marriott Vacation Club)
  • IHG = 0 hotels (based on STR chain scale rankings, but in reality many Crowne Plaza hotels are upper upscale).

Upscale market segment

  • Marriott = 1,934 hotels (Courtyard, Residence Inn, AC Hotels)
  • Hilton = 1,074 (Hilton Garden Inn, Homewood Suites, DoubleTree)
  • IHG = 634 hotels (Crowne Plaza, Hotel Indigo, Staybridge Suites)

Upper Midscale market segment

  • IHG = 3,341 hotels (Holiday Inn, Holiday Inn Express)
  • Hilton = 1,806 (Hampton Inn)
  • Marriott = 894 (Fairfield Inn, TownePlace Suites)

Midscale market segment

  • IHG = 300 (Candlewood Suites)

The key point here is to consider what market segment you desire for your travels. IHG Priority Club will tend to be lower room rates, but Priority Club does not offer frequent guest elite members the level of defined benefits provided by Hilton HHonors or Marriott Rewards to their md-tier and top-tier elite members.

Another point to add is the practice of placing branded hotels in the same chain adjacent to each other. This is really common with Marriott where Courtyard and Residence Inn are literally adjacent hotels in many places. I have seen three Marriott properties in the same location in places. Geographic coverage is not as extensive as you might think when all the locations with multiple properties are considered. On the other hand, the placement of hotels in the same chain next to each other makes hotel hopping for loyalty promotion stay credit an easy task when you want to earn free Marriott MegaBonus nights.

Comparison of hotel loyalty program benefits across these hotel brands will be discussed in future posts.

About Ric Garrido

Ric Garrido of Monterey, California started Loyalty Traveler in 2006 for traveler education on hotel and air travel, primarily using frequent flyer and frequent guest loyalty programs for bargain travel. Loyalty Traveler joined BoardingArea.com in 2008.

More articles by Ric Garrido »

Pingbacks

Comments

  1. One difficulty this faces is the difference in standards between countries. Hilton recently started expanding doubletree internationally and these are as good as Conrads in the US (KL or IST for example). Likewise with Marriott some of the intl courtyards are better than domestic Marriotts.
    But I suppose it does serve as a rough guide to each of the chains.
    …..not sure about Embassy suites being upper upscale though. I have yet to see one that meets this definition…

  2. @Tom – The STR chain scale is my way of showing an independent rating of hotel market segments as a general guide.

    I have seen the difference in hotel brand properties in international locations where a Holiday Inn has been pretty classy.

    Embassy Suites is an odd one. The price is high because of the room size, but I have been to several that certainly did not have an upper-upscale feel.

    I tend to avoid them since I don’t have children and these are popular hotels for families. I generally plan on little pool time at an Embassy Suites due to kids. The breakfast is a good feature.

  3. As alluded by Tom, the problem with this rating system is the wide difference in standards between properties of the same brand. We have all seen upper-upscale Hiltons and Marriotts but also ones that are mediocre. I would hardly classify HI, Hampton or Fairfield as “upper midscale” but I guess it depend on the competition – Is Motel 6 and Super 8 considered “midscale”? And most CPs would rank in a higher category than the listed competitors. I guess I take issue with the basic STR ratings, which makes further analysis problematic.

    BTW I would agree with you about ES – they are generally overpriced, because they are targeting families that would otherwise be looking at buying 2 adjoining rooms to house their kids. So they can overprice and still come out competitive though I would never stay here for business.

Comments are closed.