Hilton Hhonors Case

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Hilton HHornors world wide : loyalty wars Hilton Hotels regards frequent guest programs as the lodging industry’s most important marketing tool, serving to direct promotional and customer service efforts at the heavy user. How should management of Hilton’s international guest’s rewards program respond when Starwood, a competing hotel group operating several brands, ups the ante in the loyalty stakes? Jeff Diskin, head of Hilton HHonors (Hilton’s guest reward program), opened the wall street Journal on February 2, 1999, and read the headline:”Hotels raise the ante in business travel game”. The story reads, “Starwood hotels and resorts worldwide Inc. is expected to unveil tomorrow an aggressive frequent guest program that it hopes…show more content…
A branded hotel might be owned and managed by the chain, but it might be owned by a third party and managed by the chain, or owned by the chain and managed by franchisee or, in some cases, owned and managed by the franchisee. Occasionally chain managed one another’s brands, because one chain could be another’s franchisee. Starwood, for example, ran hotels under the Hilton brand as Hilton’s franchisee. Information about competitors’ operating procedures therefore circulated quite freely in the industry. Consumers For most Americans, a stay in a hotel was a relatively rare event. Of the 74% of Americans who traveled overnight in a year, only 41% used a hotel, motel, or resort. The market in which Hilton competes was smaller still, defined by price point and trip purpose and divided among business convention and leisure segments. The business segment accounted for one-third of all room nights in the market that Hilton served. About two-thirds of these stays were at rates negotiated between the guest’s employer and the chain, but since most corporations’ negotiated rates with two and sometimes three hotel chains, business travelers had some discretion to choose where they would stay. About one-third of business travelers did not have access to negotiated corporate rates and had full discretion to choose their hotel. The convention segment comprising convention, conference, and
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