Soft Brands - The Flag Planter in The Hospitality Industry

Written for ETHospitalityWorld.com

The term soft brand in hospitality best describes a hotel franchise or chain company providing benefits like distribution and loyalty in exchange for a royalty fee.When independent hotels join soft brands, they can narrow the gap to survive the next recession as brands have the resources to keep the business flowing

Hospitality brands continue to reinvent themselves and democratize travel due to the ever-changing nature of the industry. Increasingly, independent, boutique hotels are becoming popular because of the personalised services and authentic, localised experiences they offer. However, in a post-pandemic world, customers are more likely to book within a brand network because of the industry-leading cleaning standards adopted throughout brands, including soft brands, giving customers the confidence to travel.

What is a soft brand?

The term soft brand in hospitality best describes a hotel franchise or a chain company providing benefits like distribution and loyalty in exchange for a royalty fee. When independent hotels join soft brands, they can narrow the gap to survive the next recession as brands have the resources to keep the business flowing. This relationship can be mutually beneficial to both parties as the brand can use its cash reserve in marketing, enabling a stronger financial position for the independent operator.??

The other attribute chain hotels can offer a soft brand is greater flexibility and opportunities to target a specific demographic. Moreover, independent hotel owners don’t have to enter a more formal franchise arrangement with the parent company, which offers more flexibility as a key attribute. Soft brands are also free of architecture design and construction programmes which enables them to leverage inspiration from local culture, high quality food and beverage offerings, and unique experiences (catering to the millennial mindset) as they are not as brand conscious as previous generations.

A ‘soft branded hotel’ could be completely independent and a unique hotel product that can leverage the power of a major brand in distribution, marketing, sales, procurement, and loyalty by plugging into a global system. The independent hotel can generate significant visibility within its market, resulting in a higher average room rate, occupancy, and market share, assisting in reducing the reliance on online travel agencies for bookings. Most large hospitality companies have a collection of soft brands, including Wyndham Hotels & Resorts which in 2017, launched the ‘Trademark Collection,’ and in 2021, introduced ‘Registry Collection’. Both brands are designed and perfectly suited for hoteliers who seek independence on their terms and take pride in their unique spirit while leveraging the competitive advantages that come with the scale of a global partner, helping them to drive more direct bookings at a lower cost of distribution.

Soft brands are the perfect option for independent hotel owners who wish to maintain their independent spirit while tapping into the global scale, capability, and loyalty of a chain company, which is even more relevant as the industry recovers from the challenges of the worldwide pandemic. As this demand grows, independent, soft branded hotels will represent the fastest-growing segment in the hospitality industry.

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