6.28.17: Hilton’s Tru Brand Latest Entrant into Crowded Hotel Franchise Space

Hilton Worldwide Holdings (Hilton) opened its first Tru by Hilton Hotel in Oklahoma City in May. The new mid-priced brand is pricing rooms at less than $100 to attract cost-conscious travelers such as millennials. The larger lobbies and amenities such as craft beer and pool tables encourage communal interaction to offset the smaller guest room size. Lobbies look like a newly renovated campus hub at a small college — complete with a snack bar, circular signs, and funky chairs. Hilton hopes to have over 150 locations open by the end of 2019.

The brand will face quite a bit of competition as the number of hotel brands proliferate, making differentiation difficult and paralyzing hotel guests with too many brand choices. According to STR, 154 hotel chains are within the “mid-scale” brand category, of which Tru is considered part. In total, there are almost 1,000 hotel chains worldwide, according to STR.

To further differentiate the brand, the hotels will be located in smaller markets with a focus on highway locations that are popular with leisure travelers as opposed to corporate guests. To outperform its competitors in the same price range, such as Best Western or Quality Inn, Tru will try to hold costs down by making rooms smaller and easier to clean and the hotels will be all-new construction.

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