Choice Hotels 1998 Annual Report - Highlights

Providing Value To Every Customer

Each day brings new opportunities for Choice's 2,000 associates to serve a myriad of customers - hotel guests, franchisees, shareholders and strategic partners.

Before a hotel opens its doors, Choice associates work hard to help franchisees launch a successful property. "For our Sleep Inn brand we hold a pre-construction meeting with each new franchisee to review the operational and marketing resources available from Choice," said Norm Cavin, Sleep Inn brand manage-ment vice president.

The drive to provide more value through successful hotel openings has led to creation of a new team of property opening specialists who work with franchisees to develop marketing plans and programs that will get the property operating at market level more quickly.

"The sooner a hotel can ramp up its occupancy and bring its room rate to market level, the better the franchisee feels about his or her investment, and the faster our royalties can grow," said Wells. "Working with our Market Area staff, we've created a program that can add value for all concerned."

To further generate business for its franchisees, Choice also maintains a strong national sales program aimed at travel agents, tour operators, corporations and other high volume accounts. Last fall, the company enrolled all of its franchisees as members of the American Society of Travel Agents (ASTA) to enhance the relationship with the travel agent community. Unlike many other hotel companies, Choice continues to pay full commissions on business placed through travel agents.

AAA At the same time, the company cultivates its relationships with travel promotion organizations such as AAA through special discount programs for AAA members at Choice brand hotels and by encouraging franchisees to earn and improve their AAA designation.

Confronted with new competition springing up around their nine-year-old Econo Lodge in Lenoir City, Tenn., owner-operator Howard Patel and his family decided to participate in the Econo Lodge Exterior Enhancement Program.
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Flag This same dedicated spirit helps Choice internationally, working with master franchisees to open up new territories for Choice hotel brands. A 1998 agreement with the Flag organization in Australia will bring almost 500 hotels into the Choice global system, generating greater brand equity and driving more business to Choice hotels in the United States and internationally.

"As our brands truly become more global, and as guests experience their amenities and services in their own countries, we will cultivate travelers coming to our domestic locations looking for the same satisfaction," noted Bruno Geny, senior vice president, international.

While strengthening its regional teams internationally for further growth and development worldwide, Choice also is undertaking globalization of marketing services and brand management to improve its marketing to leisure and business travel intermediaries.

"Our greater brand focus will give us global brands with clear definition and differentiation," said Wells. "We can build on our presence in 36 countries to become the pre-eminent global lodging franchisor if we can create the proper value proposition for our regional partners and property owners."

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