Marriott, Disney Halt Hyatt's Lengthy Upscale Reign

Marriott Hotels & Resorts executed a dramatic turnaround in the highly competitive upscale category of this year's Top U.S Hotel Chain Survey, moving from the fourth position last year to grab the golden ring this year. This left Hyatt Hotels & Resorts, Walt Disney World Resorts and Renaissance Hotels & Resorts, chains that occupied the top three spots last year, scrambling to claim this year's other top berths. Walt Disney World Resorts locked in the number-two spot, while Renaissance finished third. This left Hyatt, which held the number-one position for six consecutive years, in unfamiliar fourth place.

Of all the survey categories, the upscale listing consistently is the most crowded. This year, 16 chains are represented, three more than last year. New arrivals include ANA Hotels, which topped the commission payment category, Millennium Hotels and Sonesta Hotels & Resorts. Many of these full-service hotels are in downtown locations and especially popular with business travelers. Complicating the situation, both Marriott International and Hilton Hotels Corp. have more than one chain in competition. In addition to the core Marriott chain, Marriott controls Renaissance. Hilton's loyalties are even more divided, with the core Hilton, Embassy Suites Hotels and Doubletree Hotels & Resorts all part of the Hilton family. In addition, Los Angeles-based HHC has a co-marketing agreement with London-based sibling Hilton International Hotels, which also appears on the upscale list.

As the lodging industry rebound gained traction in 2004 and looks likely to gain further momentum in 2005, the upscale segment is expected to perform strongly enough to regain revenue growth lost during the 2001 to 2003 downturn. According to Bjorn Hanson, who heads the hospitality and leisure practice at PricewaterhouseCoopers, revenue per available room at upscale U.S. hotels declined 13.8 percent from 2001 to 2003. "RevPAR increases for the segment forecast for 2004 and 2005 amount to 16.4 percent, making up for the earlier losses," Hanson said.

Of the 13 criteria survey respondents weighed in on, Marriott Hotels & Resorts placed first in nine, including arranging individual and group travel, the quality of its business centers and in-room business amenities and the overall relation of its price to value. Walt Disney World Resorts scored highest on three criteria, including facilities for resort meetings; helpful, courteous staff and the physical appearance of its hotels.

Marriott Hotels & Resorts in the past few years developed properties that in some way are individual in design or concept, the opposite of the more cookie-cutter approach of the 1990s. Sid Yu, senior vice president of brand management for full-service brands, as an example cited the 301-room West India Quay in London, which opened in July 2004. "The modern glass and steel building curves to face Canary Wharf, which has become one of that city's most exciting business travel destinations," Yu said. The West India Quay project also includes the first U.K. branch of Marriott Executive Apartments, intended for business travelers staying a minimum of 30 days. "Residents of the 47 apartments have access to hotel services on an as-needed basis," Yu said.

Marriott opened 19 Marriott Hotels & Resorts through the third quarter of 2004, bringing total distribution to 439, but West India Quay, Marriott's ninth hotel in London, was symbolic in another regard since it represented Marriott International's 500,000th guest room worldwide.

As Marriott Hotels & Resorts worked to distinguish itself from other upscale brands, in 2004 it rolled out new exercise and food and beverage programs at U.S. hotels, designed to build loyalty among frequent business travelers tired from life on the road. "Our research told us loud and clear that these travelers struggle for ways to eat healthier and maintain their exercise programs while traveling," said Robin Uler, senior vice president of food and beverage and spas. "As a result, we developed a complimentary in-room fitness program that gives guests at Marriott Hotels & Resorts another option to the property's fitness center."

Marriott's "Fit For You" program, meanwhile, provides travelers with low-fat, low-cholesterol and carb-conscious menu choices. "We've given chefs guidelines they can interpret and infuse with local flavors," Uler said.

Despite the rebound, Walt Disney World Resorts in 2004 did not see the narrow booking window that characterized the downturn change. "Larger groups certainly recognize the need to book further out," said George Aguel, senior vice president for Walt Disney Parks and Resorts, "but for groups under 100 people, the mindset still is short-term."

Planners of large programs scheduled after April 1 will have an expanded facility at the Coronado Springs Resort at their disposal. "We've added 86,000 square feet to the Veracruz exhibition hall, which gives that property 220,000 square feet of space on one level," Aguel said.

One change Aguel saw in 2004 was an increase in the number of meeting attendees extending pre- and post-conference stays. "More people are taking the opportunity to bring in spouses and families on either the front or back end of their meeting," Aguel said.

To facilitate arrival and departure at the resorts, Walt Disney World this spring will offer complimentary luggage delivery and airline checkin. "Attendees will be able to check bags at their airport and bypass baggage claim at Orlando International Airport," Aguel said. "Luggage will be delivered to their room after checkin."