GROWING AND SUSTAINING BRAND EQUITY

Expanding the Marriott Brand

Marriott International grew to an international hospital- ity giant from humble roots as a single root beer stand started by John and Alice Marriott in Washington, D.C., during the

1920s. The Marriotts added hot food to their root beer stand and renamed their business the Hot Shoppe, which they incor- porated in 1929 when they began building a regional chain of restaurants. As the number of Hot Shoppes in the Southeast grew, Marriott expanded into in-flight catering by serving food on Eastern, American, and Capital Airlines, beginning in 1937. In 1939, Hot Shoppes began its food service management business when it opened a cafeteria in the U.S. Treasury build- ing. The company expanded into another hospitality sector in 1957, when Hot Shoppes opened its first hotel in Arlington, Virginia. Hot Shoppes, which was renamed Marriott Corpora- tion in 1967, grew nationally and internationally by making strategic acquisitions and entering new service categories; by 1977, sales topped $1 billion.

In pursuit of more growth, Marriott continued to diversify

its business. Its 1982 acquisition of Host International made it the top U.S. operator of airport food and beverage facilities. Over the following three years, Marriott added 1,000 food service accounts by purchasing three food service companies: Gladieux, Service Systems, and Saga Corporation. Determin- ing that its high penetration in the traditional hotel market did not offer many opportunities for growth, the company initiated a segmented marketing strategy for its hotels by introducing the moderately priced Courtyard by Marriott brand in 1983. Moderately priced hotels constituted the largest segment of the U.S. lodging industry, filled with established competitors such as Holiday Inn, Ramada, and Quality Inn. Marriott’s re- search registered the greatest consumer dissatisfaction in this segment, so Courtyard hotels were designed to offer travel- ers greater convenience and amenities, such as balconies and patios, large desks and sofas, and pools and spas.

Early success with Courtyard prompted Marriott to expand

further. In 1984, the company entered the vacation timeshar- ing business by acquiring American Resorts Group. The follow- ing year, it purchased Howard Johnson Company, selling the hotels and retaining the restaurants and rest stops. The first JW Marriott luxury hotel was opened on Pennsylvania Avenue in Washington, D.C. as a tribute to the founder.

In 1987, Marriott added three new market segments: Marriott Suites, full-service suite accommodations; Residence Inn, extended-stay rooms for business travelers; and Fairfield Inn, an economy hotel brand. A company spokesman ex- plained this rapid expansion: “There is a lot of segmentation that’s going on in the hotel business. Travelers are sophisti- cated and have many wants and needs. In addition to that, we saw there would be a finite … ability to grow the tradi- tional business.”

In 1993, Marriott Corporation split in two, forming Host Marriott to own the hotel properties, and Marriott Interna-

	Brand Category	Brands
	Iconic Luxury	BvlgariThe Ritz‐CarltonThe Ritz‐Carlton Destination Club
	Luxury	JW Marriott
	Lifestyle | Collections	EditionAutograph Collection Renaissance Hotels AC Hotels
	Signature	Marriott Hotels and Resorts
	Modern Essentials	Courtyard SpringHill SuitesFairfield Inn and Suites
	Extended Stay	Residence Inn TownePlace Suites ExecuStayMarriott Executive Apartments
	Vacation Clubs	Marriott Vacation Club Grand Residences

FIGURE 11-4 Marriott International Portfolio Architecture

Source: Marriott International, Inc. Used with permission.

tional to manage them and franchise its brands. Marriott International bought a minority stake in the Ritz-Carlton luxury hotel group in 1995 and purchased the remaining share in 1998. It expanded again in 1997 by acquiring the Renaissance Hotel Group and introducing TownePlace Suites, Fairfield Suites, and Marriott Executive Residences. Marriott added a new hotel brand in 1998 with the introduction of SpringHill Suites, which provide moderately priced suites that are 25 percent larger than standard hotel rooms. The follow- ing year, the company acquired corporate housing specialist ExecuStay Corporation and formed ExecuStay by Marriott, now a franchise business.

A new century saw new growth. The launch in 2007 of stylish EDITION hotels put Marriott in the luxury boutique market. Each property was distinctive and designed by famed hotel developer Ian Schrager. The Autograph Collection was also introduced in 2011, a diverse collection of high-person- ality, upper-upscale independent hotels. AC Hotels by Marriott was another lifestyle hotel entry in 2011, an upper-moderate tier brand targeting design-conscious younger travelers in Europe with stylish, urban properties.

The last Hot Shoppe restaurant, located in a shopping mall in Washington, D.C., closed on December 2, 1999. This closing was fitting, since the tiny restaurant in no way resembled the multinational hospitality leader it had

CHAPTER 11 • DESIGNING AND IMPLEMENTING BRAND ARCHITECTURE STRATEGIES 397

Like many major hotel companies, Marriott carefully manages

its brand portfolio, including its Courtyard by Marriott, Marriott, and Ritz-Carlton brands.

Source: Andre Jenny Stock Connection Worldwide/Newscom; Andre Jenny Stock Connection Worldwide/ Newscom; Lana Sundman/Alamy

spawned. Today, Marriott International is one of the leading hospitality companies in the world, with 3,700 properties in 72 countries and territories worldwide that brought in almost

$12 billion in global revenues in 2010. In 2012, after exten- sive consumer research, Marriott International developed a formal brand architecture that it shared with prospective guests on its Web sites to aid them in their lodging decisions (see Figure 11-4).

Sources: www.marriott.com; Kim Clark, “Lawyers Clash on Timing of Marriott’s Plan to Split,” Baltimore Sun, 27 September 1994; Neil Henderson, “Marriott Gambles on Low-Cost, Classy Suburban Motels,” Washington Post, 18 June 1994; Neil Henderson, “Marriott Bares Courtyard Plans,” Washington Post, 12 June 1984; Elizabeth Tucker, “Marriott’s Recipe for Corporate Growth,” Washington Post, 1 June 1987; Paul Farhi, “Marriott to Sell 800 Restaurants,” Washington Post, 19 December 1989; Stephane Fitch, “Soft Pillows and Sharp Elbows,” Forbes, 10 May 2004, 66.