LAS VEGAS — Securing a franchise for an existing hotel can be a lengthy, complicated and exhausting process, which is why RLH Corporation wants to make it as easy as ordering a pizza. With its new FranchisEasy tool, hoteliers are able to whip out their mobile phones, enter basic information and licensing terms and—following a 14-day wait period—they will be keyed into the Country Hearth brand.
Unlike ordering a pizza, franchising is a major commitment. Though RLH Corporation’s mobile tool includes a countdown similar to Domino’s delivery tracker, hoteliers can’t simply send the brand back if it comes with toppings they don’t enjoy. That’s why Leslie Torres, SVP of digital, loyalty & partnerships at RLH Corporation, said the company is targeting a specific niche of independent economy hotels with this franchising model as it seeks to grow the Country Hearth brand, primarily though investments in technology.
“As an industry, we haven’t leveraged technology to the extent we should to bring franchisees into the system,” Torres said during the RLH Corporation’s brand conference, held at the Hard Rock Hotel & Casino Las Vegas in early December. Torres regaled the convention’s audience with a demonstration of the tool as part of the brand’s continuing technology focus, and admitted the concept is new to hospitality. However, this concept has been proven to be effective outside of the industry.
“We specialize in technology, so we’ve asked ourselves how we can leverage this to shake up the franchising space and be the most franchisee-friendly brand out there,” Torres said. “Rocket Mortgage offers home mortgages today through a mobile tool, so square one for us was taking a second look at the app process.”
The Target
According to Torres, 30 percent of hotels in the U.S. remain independent, with many of them residing in the economy segment. These hotels are an obvious target for RLHC’s collection of brands following its acquisition of Vantage Hospitality in October 2016. During the conference, however, RLHC president and CEO Greg Mount revealed plans to reduce the company’s existing number of brands from 13 to nine in order to focus on growing its supply in meaningful areas.
The question of which brands to retain and grow verses which brands to drop was a difficult one for RLHC, but Torres said they decided on retaining the Country Hearth brand while discarding Americas Best Inn, Three Palms, Jameson and Lexington.
“Vantage Hospitality acquired Americas Best Inn due to its similarity in name to Americas Best Value Inn, meaning it was always a secondary factor in the company’s growth,” Torres said. “Three Palms is not a core brand for us, while Americas Best Inn was a lower-value play. We believe we can do a lower-value play much better with FranchisEasy and Country Hearth.”
Country Hearth may be a low-value play, but for economy hoteliers the model is sound. In many cases these properties don’t need an expensive, kitted-out property-management system to perform strongly. The brand comes with few caveats, one of which is the necessity of maintaining a TripAdvisor score of 2.0 or higher. Beyond that, any hotel is eligible for the brand, from economy all the way up to luxury.
As for internal conversions from within the RLHC portfolio, Torres said there some likely will take place but the company is primarily looking outward for new hotels.
“The service offering at the corporate level is very different from something like Americas Best Value Inn,” Torres said. “That is a high-support brand. It’s meant for the owner looking for a one-on-one relationship with franchisors. Country Hearth is for operators who want to remain independent and fly solo, while receiving connectivity to the right vendors for central-reservation and property-management systems.”
Spare Change
Rolling out a mobile franchising scheme to attract new properties presented a variety of challenges for RLHC, not the least of which involved the industry’s resistance to change.
“Overcoming the traditional mindset was a hurdle. The hospitality industry struggles to be disruptive,” Torres said. “We aren’t disruptive by nature, and that’s where RLH is making its move.”
Currently Country Hearth’s portfolio consists of fewer than 50 hotels in total. At the time of RLHC’s conference, the FranchisEasy program was 48 hours old. Therefore, Torres said the company had yet to establish any clear goals for adoption and future plans for the app, with all of their energy focused on ramping up its implementation throughout the industry. When asked for a ballpark on its goals for Country Hearth, Torres fell back on humor but said to expect more news soon.
“I want em’ all!” she said.