Hilton Adds ‘Premium Economy’ Brand, Spark By Hilton; Could Grow To 1,000+ Hotels

The Hilton family of hotel brands is growing in the new year with its latest option, “Spark by Hilton.” Offering hotel stays in the “premium economy” space, the new hotel product will balance affordability with popular amenities that travelers expect (namely free breakfast and access to the enormous Hilton Honors loyalty program).

The premium economy segment is a fast-growing and lucrative one for the hotel industry allowing it to grow a footprint quickly while tapping into a price-conscious market. Hotel market segmentation is a key focus for large hospitality brands, and the economy segment represents 43% (nearly half) of the overall market with 68 million travelers choosing to stay there. With the Hilton name and Hilton Honors benefits, Spark by Hilton gives the hospitality company an entrance into this segment where it sees huge potential, what it calls “an open space” in the market.

According to Hilton data, 77% of its target travelers stay in economy-standard hotels. Its own quantitative research showed that the majority of travelers would see this addition to the brand portfolio, which includes 19 brands from affordable to luxury, positively.

It is also lucrative to hotel developers who see the segment as a rising target that delivers high margins. Hilton’s strong supply chain and pricing models can help developers to be more efficient with costs, too. Competing brands in the same market include Best Western’s SureStay Hotel Group and Red Roof Plus among others.

Spark by Hilton will be an entirely conversion brand, which means it will use existing properties to develop is new network of hotels. These will include other hotel brands that want to switch to the Spark by Hilton model, but first, all will be required to complete a full renovation to brand standards.

This allows Hilton to quickly enter and add new markets, often smaller or more price-sensitive using the Spark by Hilton concept, which could eventually grow to more than 1,000 properties.

Style and substance

Hotel owners can take advantage of the tremendous research Hilton put into developing the right mix of amenities for the price point. It includes attractive rooms with colorful furnishings although a major focus is consistency between properties, a major pain point between other brand properties, according to Hilton’s consumer research.

Open-plan closets and wall hooks offer convenient spaces for guests to unpack, but are also easier and faster for housekeepers to clean between stays. This helps reduce the time it needs for each room to be cleaned and cuts down on the need for more staff.

The simplified design is entirely intentional leaving rooms uncluttered, another facet in quicker clean times. In-room amenities include refrigerators, desks that swivel out to save space or expand as needed, and in-room workspace.

In the public areas, co-working and communal gathering space will be available including different types of seating that could include rocking chairs and communal table setups.

Existing hotels that convert to this new brand will be required to complete a full renovation before opening as a Spark by Hilton.

Freebies

A good price does not mean amenities should be pared either. Spark by Hilton will offer all guests a complimentary light breakfast. It includes a bagel bar with a variety of toppings and spreads, pastries, yogurt, juice and all-day coffee and tea.

Rooms will not have in-room coffeemakers, which can increase housekeeping times, but the entire property will have free wireless internet. The hotels will also have neither business centers nor a bar.

Guests can also purchase snacks and drinks from an all-hours lobby marketplace, including “ready to heat” items.

Familiar Hilton Honors perks

Frequent travelers can rely on Hilton Honors suite of benefits including the ability to earn or redeem points for a stay as well as use in-app features like Digital Key to unlock the guest room using a smartphone. Hilton also offers unusual benefits to guests, like the ability to guarantee connecting rooms in advance and choosing the exact room location within the hotel.

While the first hotel location has yet to be announced, Spark by Hilton properties will debut this year with a focus on U.S. destinations including everything from beach locales to interstate highway lodging options.