According to a Wall Street Journal article, the Wyndham Worldwide Corporation and Planet Hollywood Resorts International LLC have finally reached a licensing deal. This deal states that the Wyndham Worldwide Corporation will franchise and manage Planet Hollywood hotels all around the world. This means great news for the Wyndham Worldwide Corporation, even though existing Planet Hollywood hotels "will continue to own its brand trademarks and intellectual property".
By franchising and managing Planet Hollywood, Wyndham hotels will be able to surpass the offerings of their current hotels. In other words, Wyndham's hotels will be more attractive to a larger percent of the population because of the added appeal of Planet Hollywood's hotels. Another advantage of franchising Planet Hollywood is the alteration of future Wyndham hotels. According to the article, Wyndham "plans to offer developers various entertainment-based Planet Hollywood concepts for future hotels, including several restaurant chains based on hotel or resort size and location."
I believe this is a great deal for Wyndham Corp. Planet Hollywood resorts are one of the best known resorts around the world. Since it's creation, Planet Hollywood has made a strong name for itself. I have personally stayed in a Planet Hollywood resort and had great service, relaxing visits, and enjoyable dining, as well as shopping and activities. Furthermore, Wyndham Corp. is another big, strong name in the industry. The article states that Wyndham has 7,200 hotels under a dozen other brands including Ramada, Howard Johnson and Days Inn. Again, I have personally stayed multiple times at a Ramada and Days Inn and never had any type of problem. Since these companies are both strong, I think Wyndham Corp franchising Planet Hollywood will only make them stronger and more appealing. I believe it is also important to note that Wyndham "recorded a 34% increase in July in second-quarter earnings and raised its 2010 guidance. As well as company shares increased 1.1% at $28.17 in recent trading and the company stock is up 40% this year alone." Wyndham is doing extremely well.
Lastly, I believe this will create more competition in the industry. More well-known global hotel companies may want to quickly begin brainstorming licensing deals with other well-known companies, based on how well Wyndham does over the next months.
http://online.wsj.com/article/SB10001424052748704129204575506004059115436.html?mod=WSJ_business_whatsNews#&mg=com-wsj
I believe that this will be very beneficial for Wyndham and create competition between existing hotel corporations. Their popularity, along with Planet Hollywoods, should increase their occupancy rates, expecially as the industry is looking at new heights. I think this is a good idea for hotel corporations to do since it puts together two different hotel brands with different luxuries and appeals, which targets a larger number of consumers. Therefore, each hotel will gain from the other.
ReplyDeleteI agree with you that this will bring more competition into the hospitality company. Well known companies such as Hilton, Hyatt, Marriott, etc. are the typically better known because they are larger and international. I too have stayed at a Ramada hotel before, and have never had problems with service. The staff was friendly, and the rooms were more spacious than the competitors in the surrounding area. I have also heard only positive reviews about Planet Hollywood.
ReplyDeleteGood post Lauren! Way to bring in personal experience and opinion, as well as a good summary of the article. I've stayed in Hard Rock Hotels but never Planet Hollywood. Do you think this is a strategy to compete with Hard Rock (which is run by Lowes Hotels) global expansion?
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