With the opening of the first Tru by Hilton property, located in Oklahoma City, Hilton reached a milestone of 5,000 hotels. Hilton President and CEO Chris Nassetta said the brand is a disruptor in the midscale segment.
OKLAHOMA CITY—With the opening of the world’s first Tru by Hilton property, and Hilton’s 5,000th hotel overall, Hilton President and CEO Chris Nassetta said the company is getting closer to achieving its goal of serving every traveler anywhere in the world at any price point.
“We continue to diversify geographically to get even greater scale, but (as) a key element of serving any customer for any need, Tru really is a tremendous help to us because what we realized three years ago is that we have this segment that happens to be the largest segment of demand (that) exists in the industry,” Nassetta said. “Some would say you can parse the data a lot of different ways, but 30% to 40% of the overall demand for roomnights in the U.S., and in a lot of markets, is in the midscale space.”
Tru was announced at the Americas Lodging Investment Summit in 2016, and Hilton executives say it’s the fastest-growing brand in the industry. One hotel is currently open as of 25 May, the Tru by Hilton Oklahoma City Airport, which is owned by Champion Hotels, but Hilton has signed approximately 450 deals for Tru properties.
The Tru by Hilton team sought out feedback from customers, owners and franchisees on what guests want from a midscale hotel stay and how to deliver that through Tru, Nassetta said. Midscale hotels are sometimes thought of as the “graveyard hotels,” or “hotels that were one thing and then deteriorated over time,” he added, but that’s not the case with Tru.
“There’s nothing like it at scale. I’m not saying you couldn’t find a (similar) hotel, but nobody’s done it like this—that is, in a modern context, really delivering what customers want at this price point. And what customers want is something super functional,” he said.
“I want everything to work; I want Wi-Fi; I want plugs everywhere; I want a big TV; I want a nice bathroom; I want public spaces that allow me to interact with my environment. … It doesn’t have to be like … (a) lifestyle hotel because that’s not where these are typically going to go, but it needs to be fun. Everybody wants fun, everybody wants energy, so how do we create public spaces that are different than anything you’d find in that segment that allow for interaction of all sorts?”
Tru properties include smaller guestrooms with larger bathrooms, large public spaces with a breakfast bar and coffee in the lobby 24/7.
Nassetta added that Tru is one of his favorite projects because he believes it will be disruptive.
“The most exciting thing about my week and about what I do is what we’re doing with this. I’ve been doing this for 30 (years or) whatever. I’m dating myself, but Tru is the most exciting thing I’ve done in the business just because it’s the one that is the most disruptive,” he said. “I love all of my little children; my 14 babies (Hilton’s 14 brands), but … Tru is the most innovative and disruptive, in my opinion, just because somehow it’s a segment that people have just overlooked, and they’ve somehow had this philosophy that at that price point, customers don’t care.”
Hitting 5,000 hotels
The opening of Hilton’s 5,000th hotel is a milestone, but more importantly, Nassetta said, it’s another step towards serving any customer with any need.
“Five thousand hotels in and of itself is not a big deal because there’s a lot more to come. But I think it’s a milestone that’s reflective of the fact that we have a very dynamic business that’s growing rapidly with a lot of customers that are very loyal to our system, and a lot of owners who are making the choice to invest in our system because of our ability to help drive results for them,” he said.
“We’re just getting started. We’re opening more than a hotel a day this year. We opened about a hotel a day last year. I think we’ll do better than that this year, so somewhere in the world, I get an email pretty much every day saying, ‘welcome X hotel to the system.’”
Hilton is on a fast growth track, and is well on its way to hitting 10,000 hotels, according to Nassetta.
“You can do the math,” he said. “We’re opening this year probably 350 or 400, and we’re getting faster. … I think it will take us a decade—seven to 10 years—if I do my job.”
Editor's note: Hilton paid for all travel expenses and one roomnight. Complete editorial control was at the discretion of the Hotel News Now editorial team; Hilton had no influence on the coverage provided.