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Almost exactly three years after Hilton announced its upscale lifestyle Tempo brand as its 18th flag, the company announced its 19th brand. According to the company, Spark by Hilton is meant to fill a "white space" in the industry with a premium economy option.
Bill Duncan, global head of Hilton's all-suites and focused-service categories, said the new brand began to take shape as new travel patterns emerged following the worst of the pandemic. With leisure travel-particularly family travel-rebounding ahead of business travel, the company started looking at segments of the industry where it lacked product.
"We felt very good about what we've been doing with everything in the midscale and up [segments]," Duncan said. "Over the course of the last 15 years, we've more than doubled the size of our portfolio organically through new brands and growth-everything from mid-scale to luxury, and everything in between." But the company has lacked a brand in the economy space-and leaders determined this was costing them a valuable guest demographic.
TARGET GUESTS
By the spring of 2021, the company started researching the segment, finding some notable facts about the strength of economy hotels. The company determined that a full 68 million people stay in economy hotels each year in the U.S., 80 percent of overall travelers are staying in economy hotels and 43 percent of the U.S. hospitality industry is comprised of economy hotels. Just as notably, 11 percent of Hilton's target...