Let’s Play ‘Money in the Middle’

Best Western

It's not the game of Life – it's more a game of cultivating potential – and who wouldn't want to play when profitability in the mid-scale hotel market is the prize? Learn to win at "money in the middle" by reimagining the huge possibilities the mid-scale hospitality market presents for hotel companies willing to invest time, effort and finances in the segment.  

How can hoteliers play the game? Understand what today's mid-segment travelers desire. Inject heavy doses of creativity and innovation into a smart, strategic game plan aimed at substantial growth and development. Think beyond the latest industry trend – conceive of concepts for a long-term shelf-life.

Sometimes it's better not to be stuck on the outside – but instead carve out a solid place in the middle because there's a wealth of potential in this space. Here are five significant opportunities to be embraced by investing in the mid-scale market.

Opportunity 1: The "Field of Dreams" Principle – Build It and They Will Come

best-western-2Shift your mindset of what you believe a mid-market traveler wants. The modern-day, mid-scale demographic craves the hip design and lifestyle focus appeal of the boutique hotel experience. So, why keep it exclusive to the upscale segment? Boutique hotels can branch out from where they've lived in the luxury tier and build a firm strong-hold in a market that wants them. Best Western recognized the potential and last year they made their foray into the market with the launch of GLō℠ and Vīb® brands specifically targeted to this space.

Rates hovering between $80 and $90 per night keep to an attractive price point, especially when guests enjoy a value-oriented experience without sacrificing quality or service levels – and this applies to both leisure and business travelers. If hoteliers embrace the potential of the mid-scale space and fill the property gap, they (guests) will come.


Opportunity 2: Enjoy Reduced Construction Costs

Mid-scale properties tend to have a smaller footprint and less extensive facilities, meaning lower overall construction costs. The result – higher profit margins. The mid-scale space is also generally eyed as a less risky investment due to a lower cost basis, making this attractive to financiers.

Companies not interested in a new build can repurpose existing hotels with good bones and reduce construction costs. Apply the extra budget to the interior space to craft a boutique atmosphere.

Although construction costs will likely increase over time (for land and materials such as concrete and steel), continually evolving technology software (both architectural and design-wise) is driving enhanced construction efficiencies, and that's a bonus for mid-market properties.


Opportunity 3: Flex Creative Muscle with Room Design 


Entering the mid-market with a boutique product affords the opportunity for innovative design in hotel rooms as well as the public spaces. "Dress" the mid-market hotel in the luxury boutique style and encompass local flavor while keeping costs at reasonable levels and ensuring service is impeccable.

Make a statement by curating spaces to be smartly engineered, cost-effective to build, and possessing a distinctive personality. Best Western's new GLō℠ brand is a good example of this execution. The company designed the adjacent guest room baths to be center-loaded, saving about 40-50 square feet in construction costs.

It's not always the size of the room that matters, but the character it embodies.


Opportunity 4: Grow Your Geography 

Expand your reach by developing a boutique presence in secondary and tertiary markets.  These markets – where hotel companies might once not have been able to move into with another product – are now ripe with mid-scale potential.

Lower barrier to entry costs and reduced labor charges in these markets appeal to the bottom line, allowing hotels to bolster their geographic maps.

Entering secondary and tertiary cities also helps raise the markets' profiles among leisure and business travelers and adds to the cycle of growth and development.


Opportunity 5: Capture Guests for Life 

Give hotel guests what they want – especially amenities they expect – and that puts hotels on the road to likely retaining those guests for life. And, that applies across the board of pricing. Create a hotel world that speaks to guests' interests and resonates with them, and reap the rewards of long-term guest satisfaction and loyalty.

Mid-scale properties can make a huge impact here. Consider the issue of Wi-Fi. While Wi-Fi remains an extra charge at many luxury hotels, it is often included at a mid-market property. Featuring such an amenity presents a significant occasion for satisfying guest wants and building on this new age of mid-market, boutique brand styling. Even designing a hotel room with conveniently placed outlets and really good lighting (two sometimes overlooked but crucial in-room elements) tells a hotel guest "you get me," and that fosters repeat business.

The mid-scale hotel space is full of profit-yielding potential; plus, it offers hotel companies the opportunity to make a meaningful mark in the industry. When opportunity knocks – listen, re-imagine the possibilities, and be a trailblazer. It's the game plan for how hotels can triumph at "money in the middle."

Headquartered in Phoenix, Ariz., Best Western® Hotels & Resorts is a privately held hotel company with a global network of 4,100* hotels in more than 100* countries and territories worldwide. Best Western offers seven hotel brands to suit the needs of developers and guests in every market, including Best Western®, Best Western Plus®, Best Western Premier®, Executive Residency by Best Western℠ and the company’s soft brand, BW Premier Collection®.  The company’s two newest brands, Vīb® and GLō℠, were unveiled in 2015.
Celebrating 70 years of hospitality in 2016, Best Western provides hoteliers with global operational, sales and marketing support, and online and mobile booking capabilities. More than 26 million travelers are members of the brand’s award-winning loyalty program Best Western Rewards®, one of the few programs in which members earn points that never expire and can be redeemed at any Best Western hotel worldwide. The company continues to set industry records regarding awards and accolades, most recently receiving 50 HSMAI Adrian Awards, earning four consecutive Compuware Best of the Web gold awards for best hotel website, and achieving seven consecutive AAA/CAA Hotel Partner of the Year awards. Nearly sixty percent of Best Western branded hotels earned a TripAdvisor Certificate of Excellence award in 2015.

This article is brought to you by Best Western® Hotels & Resorts, and was produced in partnership with Hotel Management’s sales team. Hotel Management’s editorial team played no part in developing the article.