LAS VEGAS—With more than 1,600 franchisees in attendance at G6 Hospitality’s annual convention here last month, the company detailed forthcoming initiatives, including the launch of the brand’s revenue management system, GROW (G6 Revenue Optimization Workspace), and new franchise agreements in Mexico.
The agreements include building three Hotel 6 properties in Querétaro, León and Irapuato. With an average investment of $3 million per location, the properties will offer the company’s Phoenix design and amenities. The properties in Querétaro and León are targeted to open in 2017; while the location in Irapuato will be ready by 2018.
Dean Savas, EVP, franchise & international development, told Hotel Business that there are significant opportunities in Latin America that havn’t been tapped. “G6 Hospitality decided to expand internationally because we saw this as a natural growth path for our iconic brands. We already have a robust presence and strong brand awareness in Mexico’s bordering states: Texas, Arizona and California. In recent years, the influence of the Mexican middle class has been growing consistently and is set for future growth, aiding new demographics with more disposable income,” he said. “We specifically designed our new brands, Hotel 6 and Estudio 6, with mid-level managers in Latin America in mind. Also, strong brand familiarity made Mexico a natural choice for the international expansion of the G6 Hospitality brands. Likewise, there is substantial industry movement in certain areas—especially in central Mexico. The automotive industry in this area provides more jobs, and that gives us a worthy scenario for growth.”
According to Savas, in Mexico alone, it’s expected that Hotel 6 and Estudio 6 will open up to 55 locations, approximately 5,400 rooms, by 2020. “The franchisees’ investment for this market and time span is estimated at $185 million,” he said. “At the current time, two Estudio 6 projects are under construction in Mexico—in Puerto Vallarta and Salamanca. Located in central Mexico, these properties will thrive where federal spending on infrastructure makes the economy particularly strong. With this aggressive expansion plan, our goal is to become the first American brand in the economy segment and a key player in the overall Mexican hotel industry.”
The company will also focus on Bolivia, Ecuador, Colombia, Chile and Peru. “We see a fantastic opportunity to bring G6 Hospitality brands to these markets due to several indicators, including signs of a stable economy, a growing middle class with purchasing power, the international investment in local industries, opportunity for multi-unit developments and the government infrastructure investment,” said Savas.
As for the launch of GROW, Lance Miceli, CMO of G6 Hospitality, told Hotel Business the hospitality landscape is becoming increasingly challenging with more devices and channels available. “We needed to put a tool in the hands of our operations folks that give them the ability to maximize revenue. Revenue management systems have always been a staple, but the one we designed was specifically tuned to our business, intelligently architected to be more comprehensive in its approach.”
Designed for the economy segment, GROW offers near real-time rate and inventory management from any device 24/7. It was designed mobile first, with a fully responsive code base. There are two components to the system: the rate administration module, designed to manage rates, discounts, policies and restrictions, and is compatible to work with any PMS; and revenue optimization, which integrates near real-time inventory reconciliation between all channels to facilitate dynamic pricing. The company worked with Naples, FL-based Above Property to develop this, which works with TravelClick to pull in competitive price position data. It is a rules-based engine that automates based on revenue management practices, and alerts are presented to the person running the business. “This is a key difference of our system,” said Miceli. “It doesn’t automatically make the change based on history. Instead, it provides the competitive intelligence, history and future data streams required for an individual who knows the market to make that adjustment. It’s the blend between skilled professional revenue management and technology.”
The first component of the system had already been rolled out to all locations earlier this year, but, with the exception of properties that piloted revenue optimization, this is the first time the second component is commercially available for properties. “The reaction has been very positive,” reported Miceli, who noted that operators have been able to get a feel for the rate administration component. “We solicited a number of them to help us pilot the revenue optimization component and brought them into the development process so they could give us guidance to refine and enhance the product… We’ve got a schedule of features and additional functionality going into 2017 and years beyond that.
“The neat thing is this is the capstone of a 2.5-year demand enhancement platform project,” said Miceli, noting the project included the rollout and enhancements of the responsive website, expansions of partnerships with third parties and CRS work. “Everyone was excited about this since it was another integration of a synchronized process. We try to make it easy for a user.”
But the company isn’t done yet. “Very shortly, you’ll be able to plug into our new app, which will be replacing the legacy app. We’ll begin in the future some heavy database work that will tie back into GROW because we will be able to more intelligently target and offer to guests proposals, rates and information based on history,” said Miceli. “It’s a well-architected roadmap that was pretty methodically executed.” HB