Hilton's Bill Fortier on shaping company into a franchise powerhouse

If not for a chance encounter with a hospitality professor, Bill Fortier, now Hilton Worldwide’s SVP of development, Americas, might still be bumming around California—not overseeing development and franchising of all Hilton brands for both North and South America.

Post high school, Fortier, like many still searching for direction, lived at home with his parents in Lodi, Calif., a smallish town close to Sacramento with a population then of only 25,000. But, at the convincing of the professor, he finally decided to focus on hotel and restaurant management at the University of Houston’s Conrad N. Hilton College of Hotel and Restaurant Management.

“Truthfully, I think my parents were more excited than I was when I decided to leave home for Houston. They were happy I was not going to waste away bouncing between water skiing and snow skiing for the rest of my life,” he said.

Fortier has now been with Hilton for 18 years, which is somewhat an anomaly these days in an industry as peripatetic as hospitality. That almost two-decade-long stretch, however, was preceded by 10 years with Hilton’s chief rival: Marriott International, where he was VP of development. It goes without saying that the two companies today wage war for customers: both consumers and owner/developers.

At the time Fortier left Marriott, many thought he was making a mistake. “My colleagues thought I was crazy,” he said. In 1996, Hilton was only a one-brand company. “But I went over to help get Hilton Garden Inn off the ground,” he said. “After developing Courtyard with Marriott, I knew the huge potential for a competing brand with the power of Hilton supporting it. The only way to beat Marriott, or any competitor, is to be laser-focused on the customer. For my team of developers, that means the hotel owners. They are the reason we do what we do.”

Three years after Fortier joined Hilton, the then Beverly Hills, Calif.-based company made one of its signature deals: acquiring the Promus Hotel chain and its four brands, DoubleTree, Embassy Suites, Hampton Inn and Homewood Suites, for $3.7 billion. Fortier, at the time VP of franchise development, was instrumental in folding the brands into what was then known as Hilton Hotels Corporation.

At the time of the acquisition, one analyst said that five years from now, the deal could prove to be a profitable transaction for Hilton. It’s been that and then some. “It was a great acquisition, and I think the one that set us up to be the industry leader we are today,” Fortier said. “I saw a huge opportunity from day one. With Promus, we got a franchising machine with a large number of very smart owners, the bulk of which were Hampton Inn owners.”
From the beginning, Fortier set up the sales team to sell all of the brands and made a shrewd decision to try and convince existing owners to own other brands. It worked. Fortier said that about 70 percent to 75 percent of new deals today came from existing owners.  

“In order to make the acquisition a success, we had to move Hilton from doing 50 deals per year and Promus from doing 100 deals per year, to a company that could do 400 deals per year,” he said, an accomplishment that was achieved in 2007.  

Hilton Worldwide, particularly in North America, is a franchise company (in EMEA and other emerging markets, and with its luxury brands—Waldorf Astoria and Conrad—it operates more as a management company)—and there is a reason for that, Fortier said. “The [franchise] model works so well in the U.S. because there are so many great qualified third-party managers,” he said. “Once you get out of North America, the model falls off. “As you move out into emerging markets, focus service is emerging with them. It was full service, but as markets emerge, people look for other [lodging] options. It’s a huge opportunity for focused service.”

In Asia, for example, Hilton just started rolling out the Hilton Garden Inn brand and has 16 or so deals in the construction or approval process. In 2013, Hilton opened 207 hotels with nearly 34,000 rooms, with conversions accounting for 35 percent of these openings. Fortier said that number of openings will be eclipsed in 2014.

There’s no doubt Fortier has come a long way since his days in Lodi. And while he is a Hilton man, living on the East Coast, he still misses home. “My heart is still in the West Coast,” he said. “Especially this time of year.”