Hilton was about to cross the 1,000 hotel threshold in the European, Middle East and Africa (EMEA) sector this spring, opening about one hotel a day in the region last year.
Simon Vincent, executive vice president and president of Hilton's area, said the company had 500 more properties during development, with more than half of them already under construction.
Hilton's expansion strategy depends on matching the right brand to the right market. Recent launches in the area included tempo by Hilton and spark by Hilton.
The tempo of lifestyle brand Hilton is a great example of strategy. “It's our stylish lifestyle brand… designed for younger travelers,” Vincent told Skift.
The brand focuses on wellness and design, coupled with its placement in cities such as Belfast, Lisbon and Reykjavik, aims to drive Hilton ahead of market trends.
“We're sure we have the right formula. It's pretty bad in (US) states. It's new to Europe, the Middle East and Africa, but the early levels of interest are very strong.”
Spark by Hilton, a premium economy brand, shows that Hilton is looking to expand its customer base.
“It's just taking advantage of a niche we don't do,” he said. “We believe there is an entry point just below the customer (Hampton) just below the level where we can appeal to customers we can appeal to. … Our first level is trading pretty well.”
More conversions and franchises
Transformation has played a key role in Hilton's expansion in mature markets like the UK.
“There is only limited space in the UK. Many hotels are already built, so there's a lot of conversion activity coming up,” Vincent said.
Franchise models have also gained traction, especially in the UK and Western Europe.
“Perhaps 60% of the pipeline is franchise hotels,” Vincent said. “This involves market maturation.”
Adapt to local dynamics
Hilton's growth strategy involves adapting to the distinct dynamics of different subregions within the EMEA.
“In contrast, the Middle East is about building new hotels,” Vincent said. “Traditionally, there has been a lot of growth in luxury and the top edge of the market, and now there is real opportunity in the medium market.”
The company's approach includes the balance of global brand standards and regional relevance.
“Brands need to be global in strategy and vision, but they need to be regional when they are running,” Vincent said. “We need to be clear where we want to bend the brand to meet local needs without diluting the overall strength of an inclusive brand.”
Loyalty
The Hilton Honors Loyalty program plays a key role in fostering repeat business and customer engagement.
“There's an insatiable desire for loyalty,” Vincent said.
“We now have the ability to connect the hotel to the Hilton system, ensuring that 50% of the occupancy comes from the loyalty program. And because the business is direct, it is the most cost-effective business to the hotel.”
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