December 18, 2019

Wyndham Hotels & Resorts Explained

Wyndham Hotels & Resorts, based in Parsippany, New Jersey, is one of the largest hotel chains in the world along with competitors like Marriott International and Hilton Hotels & Resorts. As of March 2019, the franchise has approximately 9,157 hotels internationally — 812,100 rooms — primarily in the United States.

Previously the CEO of Wyndham Destinations, Geoffrey A. Ballotti took over as president and CEO of Wyndham Hotel Group in March 2014, replacing former CEO Eric Danziger. He leads the company with Chief Financial Officer David Wyshner and Chief Marketing Officer Lisa Borromeo Checchio.

The Wyndham Hotels & Resorts chain includes 20 brands as of 2019 — ranging from upscale to extended stay. The economy scale Super 8 brand is the largest within the company, accounting for over 2,000 hotels.

MINI HISTORY

The company’s complex history dates not too far back into the early 1980s, as one of many in the much larger Wyndham Worldwide Corporation.

The company was founded in 1981 by Trammell Crow, the former president of Trammell Crow Company (TCC), a real estate development, investment, and property management company. The hospitality group grew in a short amount of time compared to other hospitality giants around the world.

James D. Carreker in 1988 took over Wyndham from the Crows’. The company was then publicly traded on the New York Stock Exchange in 1996, following an initial public offering.

Under Carreker, Wyndham Worldwide grew rapidly in the late 1990s. To pay off the debt from multiple hotel acquisitions, the company was purchased by real estate investment trust Patriot American Hospitality (PAH) in 1998. The following year, Patriot merged with Wyndham, restoring the company back to its original hotel operations.

The hospitality company experienced major growth under Danziger, who took over in 2008, following a period of debt and hotel losses. By acquiring brands, such as Microtel and Hawthorn Suites, and converting them to Wyndham brands, the corporation was strengthened to one of the largest franchises.

Following the appointment of Ballotti, the company began to focus more on its international business, primarily in the Middle East. Wyndham also changed its loyalty program with a simpler approach, one where members can stay in any of the properties after reaching 15,000 points.

Wyndham Worldwide in February 2018 announced the sale of its European vacation rentals, which was considered to be the largest collection of holiday rentals in Europe with more than 110,000 properties spread out over 600 destinations, to the private equity Compass IV Limited for $1.3 billion.

Wyndham Hotels & Resorts completed its spin-off from Wyndham Worldwide, now Wyndham Destinations, in June 2018.

CURRENT BIZ AND CHALLENGES

Shortly after Wyndham Hotels & Resorts separated from Wyndham Worldwide, the company completed its purchase of La Quinta Inn & Suites for $1.95 billion last January, expanding the company’s midscale business by 9,000 hotels. Since the beginning, Ballotti had high hopes for the merging of the brand but has faced a series of ups and downs.

As of February this year, the company as a whole reportedly had a flat quarter in the U.S. By October 2019, the company experienced a 35 percent increase in the hotel’s franchising revenue, mostly due to the integration, despite La Quinta’s 4 percent decline in RevPAR (revenue per available room, a key industry measurement of performance).

The hospitality giant recognized the work that needed to be done in the economy segment and has been struggling to add quality rooms while getting rid of properties that didn’t meet its standards.

Following other major hospitality groups, like IHG and Hilton, the company started adding “by Wyndham” to all of its brands last April. With 20 hotel brands linked to the Wyndham name, this endorsement will make it easier for consumers, including loyalty members, to identify hotels connected to the hospitality group.

Just three years after the company retooled its rewards system to be simpler and more straightforward, Wyndham decided to revert back to its three-tier loyalty program. Senior Vice President of Global Loyalty and Partnerships Eliot Hamlisch said 70 percent of members and prospective members preferred multiple tiers.

WHAT’S NEXT

Ballotti outlined a plan last year for Wyndham’s growth, as well as solidifying its identity, after formally becoming an independent company. Through a new multimillion dollar marketing campaign, the group has invested in advertisements, including digital, radio, and television ads.
The hospitality company has also been working on the quality of its properties since the spin-off, focusing on selling brands, like the Knights Inn, that don’t meet these new quality standards.
Ballotti has been focusing on expanding the La Quinta brand since its integration was finalized in April. The hospitality group has been working on the outer look of the hotel, including indoor and outdoor pools as well as architectural schemes to maximize hotel space.
Wyndham has recognized that the majority of travelers preferred select service lodgings, which are hotels that don’t offer extra amenities. They have been focusing on that with La Quinta.
Plans now are to continue expanding the brand in the overseas market, primarily in Southeast Asia. Currently, the company has seen its fastest growth in China, which now has 11 Wyndham brands. The group also wants to see growth in South America and Europe. In the next three years, the group has hopes of opening 2,000 hotels in the U.S., as well as in its international market.
COMPETITORS

InterContinental Hotel Groups
One of the largest hotel chains in the world, IHG has over 5,600 hotels globally, comprising 17 different brands. The company is currently focusing on buying luxury brands and expanding its technology.

Marriott International
After becoming the largest hotel group in the world in 2016 following its acquisition of Starwood Hotels and Resorts, Marriott is focusing on expanding its Bonvoy rewards program. The company is also using its recently announced luxury homesharing business to build up brand loyalty.

Hilton Hotels & Resorts
Roughly the same size as IHG, Hilton is continuing to expand it brand, opening about two hotels a day. Recently, the hospitality giant has seen an increase in its Honors program as a result of better member engagement, while also being more attentive to lower-tier members.

Accor Group
The largest European hotel group, Accor is continuing to expand in European and Asia-Pacific markets. Despite having fewer numbers in terms of rooms and hotels, the French hotel chain has more brands than Marriott. Following the launch of Greet and Tribe in 2019, Accor now has 39 brands, whereas Marriott has 30.

Copyright 2019 Skift. All rights reserved. From https://skift.com. By Jasmine Ganaishlal, Skift.

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