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A Good Fit

WorldHotels Looks Forward To Accelerated Growth As Part Of Best Western

Monday, November 04, 2019
Dennis Nessler
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At last month’s annual convention, Best Western Hotels & Resorts charted its recent progress for members in several areas, but the company’s addition of WorldHotels earlier in the year and subsequent entry into the luxury segment was undoubtedly one of the more notable highlights.

The Phoenix, AZ-based multi-branded company acquired WorldHotels--which includes a collection of roughly 300 upper-upscale and luxury independent properties throughout the globe—in February. WorldHotels—which was founded more than 50 years ago—will continue to be led by CEO Geoff Andrew and operate as a separate entity.

Best Western CEO David Kong noted the deal came together “very quickly” in as little as three months. Several key executives offered a progress report on the new partnership during the recent conference and why the deal made sense from each company’s perspective.

Best Western Board Chairman Anthony Klok—who has had as many as 3 WorldHotels properties in his portfolio within the last decade— touted the benefits of the acquisition.

“I saw personally so many tremendous opportunities in terms of the synergy and the similarity in cultures and everything that can be brought together. I knew what WorldHotels was lacking in terms of providing to the members there and what I was experiencing from Best Western and what that could bring over to enhance WorldHotels and elevate it further. I saw Best Western could grow by filling part of their travel niche that they were missing in the upscale luxury market and now this fills that…It’s a great partnership and a great future that I see for us in that,” he said.

Geoff Andrew, CEO, WorldHotels, was equally excited about the deal and noted it was effectively “future proofing” the company for success. “What we needed more than anything was scale and resources,” he said.

Andrew continued, “In a nutshell it’s coming into an environment where we’ve got an incredibly robust platform now and where our hotels can still enjoy being independent. It was the access to resources to compete in a world where scale is important and ultimately all of those things to drive more business to our members,” he said.

WorldHotels had been owned by ALHI (Associated Luxury Hotels International) previously and while Andrews described it as “decent partnership” he acknowledged the company had identified the need for a new partner to help take it to the next level.

“It was clear it was not delivering for our members the way that we had hoped so there was a mutual recognition that it was time to part company. The attractive thing about Best Western is from a philosophical point of view it’s a very similar approach with its membership base,” he said, adding it’s a “pretty democratic organization.”

Gregory Habeeb, president, WorldHotels North America, also weighed in on the deal. “We fulfill that top end luxury for them [Best Western] that they were missing. We now can compete with all the strata and that’s a very important vertical integration. That’s the vision we all had together,” he said.

Andrew detailed some of the anticipated impact of becoming part of Best Western. “The two areas where we’re expecting to see the best impact is on the b-to-b side with these combined [sales] teams and secondly with the adoption of the WorldHotels Rewards program. All the work we’re doing now is more likely to see a material impact as we go into next year,” he noted.

Habeeb, meanwhile, did acknowledged that he’s seen a marked increase in development opportunities already since the acquisition took place, particularly in North America, which he referred to as the brand’s “honey spot.”

Additionally, Habeeb noted that a good number of Best Western members have already expressed an interest in becoming part of the luxury brand.

“What we learned here is there’s a lot of hotel owners that have had their midscale [properties] and want to have a luxury hotel. We can put it [their property] with World and keep it in the Best Western family,” he said.

Andrew acknowledged that a good portion of the company’s focus has been on consolidating the sales forces for both companies, which now numbers some 200 associates. “A lot of that was just to do with making it synergistic. You just don’t want to come across confused to the market...Both sides had and continue to have some very strong relationships out there but you want to make sure you’ve got unity of managing those organizations, ” he said.

Andrew further added alignment has been a top priority. “On a global basis that’s been quite a feet to accomplish, but it’s important right now that we’ve got all our ducks in a row for the 2020 business,” he concluded.


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Dennis Nessler    Dennis Nessler
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