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Baymonts's Strategy to Differentiate Brand from
Competition Involves the Bed, the Bath, Breakfast,
Business Services, and Benefits
Franchise Owners Conference Validates Baymont Inns & Suites Is A Leader In Midscale Without F&B Market

Milwaukee, Wis. — (November 6, 2003)  - According to an article that appeared in the
October 8th issue of The Wall Street Journal, “Hotel companies are trying once again to make their brands stand out from one another.”  Dan Daniele, president of Baymont Franchises International, commended attendees at the brand’s annual Franchise Owners Meeting held in Clarksville, Tenn., earlier this month for being “far ahead of the curve on brand differentiation.”

“When we launched the Baymont Inns & Suites strategic plan, we formulated that plan, not in a vacuum, but by holding regional owners meetings to gain your insights to the programs the brand was considering, and then testing those ideas in the properties,” Daniele said.  “The plan was based on a simple but effective value proposition: Position, Product, Performance, People and Profit.  To produce the five Ps, the five Bs were put into action to bring differentiation to life: the Bed, featuring pillow top mattresses and down pillows; the Bath, featuring fluffy towels, branded bath products and in-room bottled water; Breakfast, with name branded breakfast items including French toast and waffles; our Business services, which feature enhanced workstations with an executive-sized desk, comfortable ergonomic chairs and task lamp with a data port, and high-speed Internet access at many locations; and finally, Benefits, which include a 110% satisfaction guarantee program, a state-of-the art two-way reservation system that allows for last-room availability, and a Guest Ovations® frequent-stay and loyalty program.” 

According to the WSJ article and a recent study conducted by Travelocity on business travel trends that stated “comfortable bedding tops the best in terms of hotel amenities that matter most,” Daniele said consumers are noticing and validating the brand’s vision.

“While other chains are just now embracing these services and amenities, Baymont Inns & Suites is years ahead,” Daniele said.  “Differentiation is now the buzz word, and it is paying off for Baymont Inns & Suites.”

Performance Supports Differentiation

Mark Lomanno, president of Smith Travel Research, presented supporting documentation of Daniele’s claims.  According to STR competitive set data, for the first eight months of 2003 Baymont Inns & Suites has surpassed occupancy results by a wide margin.  In addition, while the total U.S. lodging industry has reported a revenue per available room decline of -1.1 percent for the first eight months of 2003, and the midscale without food and beverage segment struggles with a –0.8 percent RevPAR decline, Baymont Inns & Suites system RevPAR is up significantly and continues to gain market share.

“The programs, strategies and tactics Baymont Inns & Suites has put in place over the last two years is moving the needle and creating the results that drive revenue,” Daniele said.  “This is a crystal clear representation that the system is growing stronger and can compete effectively in this lodging market.”

When the market rebounds, as it has during the last three months, Daniele said the Baymont Inns & Suites system will reap the benefits of a rising tide and revenues should continue to increase at a greater clip than the competitive set.

“Our plan of differentiation and value orientation has garnered significant market share gains during the past 18 months,” Daniele said.

Reservations Reaps Rewards

The implementation of a two-way reservations system and the Baymont Inns & Suites’ Guest Ovations program have assisted Baymont’s increased market share, Daniele said.

“Bookings have increased in 2002 and 2003 as corporate-owned hotels became more aggressive through e-commerce channels and our website,” he said.  “Reservations room revenue is up every month over the same period in the previous year.  We attribute this in part to average daily rate increases in reservation channels and the impact of our two-way reservation system.”

Reservation contribution is expected to be above last year’s, Daniele said.

“We are now seeing signs that the lodging market occupancy is recovering,” he said.  “All the pundits are saying that 2004 will begin the recovery in earnest with ADR showing signs of increased life.  Once that happens for a few quarters, development will begin to come out of hibernation.  By the second quarter 2005, development activity will revive.”

Two-fold Development Plan

Daniele said Baymont Inns & Suites development plan is based primarily on two elements: franchise growth and corporate development under the Strategic Market Partnership Development (SMPD) banner.

“Growth is important and vital, but not at the expense of quality,” he said. “Conversions are key to development in the midscale without food-and-beverage segment. Baymont Inns & Suites could accelerate our growth by taking less than satisfactory conversions like some of our competitors, but we have chosen not to take the low road and cripple our system with sub-standard product just to say we are growing.  We are committed instead to be a high-end conversion franchisor that will only take the ‘cream of the crop.’”

Baymont Inns & Suites has made a significant investment in its SMPD program by committing nearly $50 million in capital to enter the Southern California market and urban settings such as its new downtown Chicago hotel currently under construction.

“Baymont Inns & Suites is making investments where franchisees are not likely to build, in higher-priced and more urban areas,” Daniele said.  “These developments will be the catalyst for franchise development.”

Baymont Inns & Suites is a contender in the midscale without food and beverage segment.

“Our hearts are good, our vision is clear, our purpose is focused and our commitment is passionate,” Daniele said. “We stayed the course and the results are in our favor.”

About Baymont Inns & Suites
Headquartered in Milwaukee, Wis., Baymont Inns & Suites operates or franchises more than 180 locations in 33 states nationwide, is a wholly owned subsidiary of The Marcus Corporation (NYSE: MCS).  For more information on The Marcus Corporation, go to www.marcuscorp.com. 

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Contact:
 Tom Schroeder
Director of PR and Communications
Baymont Inns & Suites
tomschroeder@baymontinns.com
Tel: 414/905-1149
www.baymontinns.com
Also See: Baymont’s Ovations Rooms Include Upscale Amenities Program not Typically Found in Midmarket / April 2002
Baymont Inns & Suites Continue Planned Migration from Economy Segment to the Mid-market Segment / Dec 2000


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