Kevin Kowalski Vice President_ Crowne Plaza Brand

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Kevin Kowalski Vice President_ Crowne Plaza Brand Powered By Docstoc
					                                               Kevin Kowalski
                                     Vice President, Crowne Plaza Brand




CrownePlaza-Analyst-07Dec04-KK-qal                                        -0-
        Crowne Plaza is a 21 year old brand
        with two distinct eras


  Began as
                                                                           Explosive growth
    a line
                                Brand         …and back     Becomes              years         Established with
  extension
                             changes to        again to      simply       including addition     The Place To
   Holiday
                            Crowne Plaza      Holiday Inn    Crowne          of 17 FelCor        Meet and The
     Inn
                            by Holiday Inn   Crowne Plaza     Plaza          Properties in     Sleep Advantage
   Crowne
                                                                              1997/1998
    Plaza




     1983                                                     1993           1995 - 1997                2004


                  Some stops and starts on strategy                   More support, growth and clarity
                           slow growth




CrownePlaza-Analyst-07Dec04-KK-qal                                                                                -1-
        We compete primarily in the upscale segment


      US
   Industry
                                                                              10 yr trend
                                     Upscale
                                                                     Growth vs. Prior Year
                                     segment
                                                                + 25 %
                                               COURTYARD
                                               RADISSON
                                               RESIDENCE INN
                                               CROWNE PLAZA
                                               GARDEN INN
                                               WYNDHAM HOTELS
                                               AMERISUITES
                                                                - 25 %

                                                                         Supply   Demand    Revenues



                                                                                               Source: STR


CrownePlaza-Analyst-07Dec04-KK-qal                                                                     -2-
        Competitive sets include upper-upscale brands

                                        # Hotels            # Rooms

        Westin                             62                32,625
        Marriott                           317               128,968
        Hilton                             216               84,577         Upper Upscale
        Sheraton                           175               64,872
        Doubletree                         131               35,936
        Crowne Plaza                       87                26,116
        Wyndham                            71                22,793         Upscale
        Radisson                           217               53,679

   Source: STR
                                     Key Competitors are second tier Upscale and
                                     Key Competitors are second tier Upscale and
                                              Upper Upscale brands
                                               Upper Upscale brands

                                         Destination – be the best performing
                                         Destination – be the best performing
                                               Brand among this group
                                               Brand among this group
CrownePlaza-Analyst-07Dec04-KK-qal                                                          -3-
     The overall opinion of Crowne Plaza is broadly on
     par with competitors
           Overall rating of excellent/very good experience
           Among past year guests of:

                        Sheraton                          61


                     Doubletree                            63


                        Radisson                               65


                 Crowne Plaza                                       74


                              Hilton                                     79


                           Marriott                                           84


                                       0   20   40   60                80             100


                                                                    Source: Millward Brown, 2003


CrownePlaza-Analyst-07Dec04-KK-qal                                                                 -4-
        However, there is opportunity to raise awareness
        and hence consideration

                                                       Total Brand Awareness

                                Marriott                                                      100


                                     Hilton                                                   99


                              Sheraton                                                        99


                             Raddison                                                        98


                           Doubletree                                               86


                                Crowne                                         76


                                              0   20       40       60         80           100            120

                                                                                         Source: Millward Brown




CrownePlaza-Analyst-07Dec04-KK-qal                                                                                -5-
        Our overall brand strategy focuses on trial as a
        means of raising consideration and awareness


       Trial                         Efficiently Get Them In the Door   Meetings Focus




    Retrial                             Get Them To Come Back           Sleep Experience




                                                                        …Just Common
Max ADR                                 Get More $$ Out of Them            Sense




CrownePlaza-Analyst-07Dec04-KK-qal                                                         -6-
        Our primary target is meeting planners



                                                                         Non -
                                     Professional
                                                                      Professional




               Corporate                       Third Party     Corporate             Social


        •    87% female                                      • Highly variable demographics
        •    Average age 45                                  • Most often in administrative roles
        •    Average 10 years in industry                    • More likely to be from a sales
        •    Knowledgeable and demanding                       or marketing function
                                                             • Not knowledgeable



CrownePlaza-Analyst-07Dec04-KK-qal                                                             -7-
        Meetings represent an attractive opportunity


             • $15bn in revenue to the hotel industry

             • 40% of our business

             • Multiple revenue sources

             • Small and efficient marketing target




                                                        Source: D. K. Shifflet, 2002

CrownePlaza-Analyst-07Dec04-KK-qal                                                     -8-
        Our secondary target is upscale business travelers



        Profile:
        • 67% male/33% female
        • Average household income
          $83,000
        • Average age range 34-55
        • Average length of stay is 2 nights
        • 70% professional/manager




                                                 Source: D.K. Shifflet 2004

CrownePlaza-Analyst-07Dec04-KK-qal                                            -9-
        The brand has a simple promise for its two key
        audiences

                            Meeting Planners    Business Travelers




                          A better meetings    A better nights sleep
                             experience
                         The Place To Meet     The Sleep Advantage




CrownePlaza-Analyst-07Dec04-KK-qal                                     -10-
        We set ourselves apart among meeting planners




         The Crowne Meetings Director:



         2-Hour Response Guarantee:



         Daily Meeting Debrief:



CrownePlaza-Analyst-07Dec04-KK-qal                      -11-
        Our meeting planner satisfaction is outstanding

              Crowne Plaza Brand Index
                  Scores – By Quarter                                           • Lodging Hospitality:
       100
                                                                                    Chain Leadership Award
                                                                                    for Best Hospitality
                                                                     90
                                                                                    Marketing Campaign
                                                      89
         90           88                 88

                                                                                • Helms Briscoe:
                                                                                    Crowne Plaza consistent
         80                                                                         2nd on brands they most
                                                                                    like doing business with
                                                                                    (ahead of everyone but
         70
                                                                                    Marriott)
                Jul - Sep 03         Oct - Dec 03 Jan - Mar 04   Apr - Jun 04




                                                  Group Demand for 2004 YTD experiencing 15%
                                                  Group Demand for 2004 YTD experiencing 15%
                                                      demand growth, booking pace similar
                                                      demand growth, booking pace similar


CrownePlaza-Analyst-07Dec04-KK-qal                                                                             -12-
        We deliver a better night’s sleep for business
        travelers

        • Sleep amenities
        • Sleep CD and tips
        • Guaranteed
          Wake-up call
        • Quiet zones
        • Sleep expert
          staff training
        • Luxurious new
          bedding




CrownePlaza-Analyst-07Dec04-KK-qal                       -13-
     Guests love the sleep advantage

                                          Guest satisfaction Scores - Bedding

                                     90
                                     90                                 85
                                                                        85
                                     80
                                     80          75
                                                 75        + 13%
                                     70
                                     70
                                     60
                                     60
                                     50
                                     50
                                     40
                                     40
                                     30
                                     30
                                     20
                                     20
                                     10
                                     10
                                     0
                                     0
                                               April '04
                                               April '04            August '04
                                                                    August '04
                                                                         Source: IHG GSTS




CrownePlaza-Analyst-07Dec04-KK-qal                                                          -14-
        Profile of a typical Crowne Plaza
        •       Rooms:               250 - 350
        •       ADR:                 $94
        •       Occ:                 66%
        •       RevPAR:              $62
        •       Rooms Revenue:       $6 - 9m
        •       Non Rms Rev %:       25 - 35%
        •       Total Revenue:       $8 - 12m
        •       Build cost/key:      $110 - 140k
        •       Location type:       Primary
        •       Meeting space:       13,000 sq ft
        •       % Franchised:        75%



CrownePlaza-Analyst-07Dec04-KK-qal                  -15-
        Profile of a typical owner
                                         50%     50%

                               Small private       REITs and Other
                               hotel owners      Institutional Players


      • Upscale experience/history             • Some wholly real estate
      • Own management expertise or              focused:
        hire 3rd party (e.g., IHG)                   we manage
      • Some real estate players from          • Others both owners
        outside the hotel industry               and managers
      • Some midscale owners trading
        up



CrownePlaza-Analyst-07Dec04-KK-qal                                       -16-
        Both ownership groups invest in Crowne Plaza for
        the same reasons

        • Attractive, affordable investment
          Lower up front and operating investment than leading
          upscale brands

        • Momentum
          RevPAR growth leading competitive set combined with
          recent brand focus and program success

        • Best Remaining Choice
          Major brands have reached market saturation



CrownePlaza-Analyst-07Dec04-KK-qal                               -17-
        Strategic priorities going forward



          •         Aggressively grow distribution

          •         Deliver on our brand promise

          •         Continue to drive trial

          •         Become industry leaders on pricing and
                    revenue management




CrownePlaza-Analyst-07Dec04-KK-qal                           -18-
        Growth strategy for Crowne Plaza
            Growth                   Focus
            Driver
            Units
                                      √      Crowne Plaza is geographically underrepresented and
                                             will be one of the few brands available to developers in
                                             many locations

                                             Flexible fit to wide range of hotel sizes and locations
                                             maximises its potential locations

            RevPAR
                                      √      Focus is on capturing repeat business from guests
                                             who experience the brand through
                                             meetings/conferences

            Royalty                          Pricing on par with competitive set
            rate




CrownePlaza-Analyst-07Dec04-KK-qal                                                                      -19-
     CP has grown only marginally slower than the
     upscale segment
                                                                            Crowne Plaza US vs Upscale Segment
                                                                              Growth in Available Room Nights
                                                                                     (Index = 100, CAGR with label)
                                                        140
          Available Rooms Nights per annum (millions)




                                                        130                                                                               Upscale 6.2%
                                                                                                                                          CP 5.6%
                                                        120


                                                        110


                                                        100


                                                        90


                                                        80
                                                              2000   2001              2002                           2003            2004




                                                                                 Source: STR; average based on rooms built and converted 1999 - 2003


CrownePlaza-Analyst-07Dec04-KK-qal                                                                                                                       -20-
        Lower tract coverage than competitors

                                                  % of tracts containing brand




                                                               39%
                                                                          31%
                                                     28%
                                                                                     23%
                                       19%
                      13%
                                                                                                 10%


                   Crowne            Doubletree      Hilton   Marriott   Radisson   Sheraton   Wyndham
                    Plaza
                                                                                               Source: STR




CrownePlaza-Analyst-07Dec04-KK-qal                                                                           -21-
        Conclusions

             • We have established a well positioned brand for
               specific key audiences

                                     Owners – The next best choice among unsaturated brands

                                     Guests – A clear and differentiated brand proposition for
                                     both key audiences

             • We are well positioned for aggressive growth

                                     Brand strengths

                                     Creative development strategy




CrownePlaza-Analyst-07Dec04-KK-qal                                                               -22-

				
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