Why Do Hotel Chains Need So Many Brands?

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Where Are You Staying?

That question is becoming harder and harder to answer. 

It’s no longer just Hyatt (H), Hilton (HLT), or Marriott (MAR). Hyatt has 14 separate hotel brands. Hilton has 22. And Marriott has 32 — enough to inspire a viral bingo game. 

Hotel chains are rolling out these seemingly endless sub-brands in a bid to service the widest variety of customers possible. But in doing so they risk undermining their own brand loyalty.

Everything But Simple

Cancellation policies and cleanliness pledges have made it attractive to book directly through hotels, and to leverage this new relationship, hotels are expanding their offerings.

Now, what was once a simple dichotomy — “economy” or “luxury” — has become a confusing spectrum from “premium economy” to “classic luxury” to “cutting-edge luxury.” These fractionalized brand identities are designed to appeal to specific subsets of customers. The hope is to rope in younger customers with low rates, and keep them loyal as their buying power grows. 

Lost in Liminal Space

This strategy might make sense in theory. But in practice, it’s hard to stay loyal to a brand when you don’t know what the brand is. 

Critics say the distinctions between the different sub-brands are often unclear, leaving customers with too many options to choose from and not enough to differentiate them.

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