Staying at independent boutique hotels and other unique hospitality businesses is becoming increasingly popular. This trend has flourished because of another recent trend in the hotel industry called “deflagging.”
NB: This is an article from Forbes
What does “deflagging” mean?
In the past, hoteliers who wanted to start their own hospitality businesses often turned to big chain hotels like Marriott International or Hilton Worldwide to help them. Why? Because these big chain hotels could provide reliable business and safety through a big brand name.
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In addition, this brand recognition reduced the individual marketing costs to the individual owner and provided operational guidance, software and training systems. This purchasing of a chain name to use for a business is what’s called “buying a franchise.”
However, many individual hotel owners are no longer turning to big chain hotels to provide the safety they want in running their businesses. Instead, they are discarding the big brand name in exchange for an independent name that promises a unique reservation experience. When an independent owner discards the franchise they’ve purchased, they’ve “deflagged” their business. The reason it’s called “deflagging” is because the hotel can no longer display the brand flags and branding on their hotel property.
Deflagging is happening due to multiple reasons:
1. Some big chain hotels are reducing services and staff, which affects brand integrity. For example, many hotels have eliminated daily housekeeping and in-room dining. Once famed breakfast buffets have changed to to-go bags. Problems can arise when these temporary changes become more permanent to keep costs low as hotel chains recover. Marriott predicts that business won’t return to 2019 levels for three years. In the meantime, many boutique hotels can take advantage of their smaller sizes to return to a higher level of service more quickly.
2. Younger travelers have more brand loyalty to online travel agencies like TripAdvisor, Booking.com, Expedia and Airbnb rather than legacy hotel brands. Upcoming generations aren’t as brand loyal to the large hotel chains as previous generations. Travelers who book hotel rooms on mobile devices prefer online travel agencies to hotel brand sites by a three-to-one margin. Additionally, online travel agencies are usually preferred over booking directly with a hotel because of better price transparency