Does Hilton Need Another Brand and Isn’t Hampton Inn Midscale?

Hilton’s CEO announced on their earnings call that in 2016 it will open a midscale hotel brand because they don’t have a midscale hotel brand. Huh?

Hampton Inn, Hilton Garden Inn not midscale?  Not anything else midscale lurking among its 11 brands? I don’t know what Canopy and Curio are, while Homewood and Home2 fall separately into the extended stay category.

Travel Weekly summarizes the comments:

[Hilton CEO] Nassetta said a huge swath of customers cannot afford to pay room rates at its lowest-price chain, Hampton Inn, an upper-midscale brand that was initially targeted at the midscale segment “but has grown up out of it.” Hampton’s average daily rate across the chain will be about $115 this year, Nassetta said.

Furthermore, Nassetta said that “there is no good midscale product, and that’s why we are doing it.”

and:

Hotels will be constructed and operated “in a very simplistic way to be able to drive returns like we’ve done with Hampton,” he said. Nassetta envisions a “megabrand” that could amass more than 1,000 hotels “just as we’ve done with Hampton.”

This gets to the crux of it: Hampton Inn is a midscale product that is overpriced. On the rare occasions I pay cash direct to a hotel, meaning not using points, Priceline or other methods, I find Hampton Inn overpriced in my estimation to what I see as its competitors. Great for them as a business to be able to charge a premium. I look elsewhere.

To me there are two types of hotel rooms in the US: those with central air con and those with wall units under the windows. My wife tolerates a lot, though always wants to avoid those rumbling wall units.

Hampton Inn is a wall-unit brand and one that offers free breakfast. I see it in the same soup of limited-service brands that may or may not offer free breakfast. On my midscale view, I prefer the extended stay brands because of the kitchens and quirky evening receptions (“It’s cupcake night”).

I recently had my first Hilton Homewood Suites stay in Seattle (liked it) and first IHG Candlewood Suites stay in North Charleston (smelly dump). Marriott Residence Inns are my favorite, though halved Marriott Rewards earning is a deterrent to paid stays. There are many more brands and I am not a US road warrior to give a deep view.

I doubt the world needs a new Hilton brand. Here it comes.

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  • I agree about Hampton Inn. I make a yearly visit to Alexandria, VA and was looking to them as they have a nice central location. However their rate was about $30 more than the other hotels in the area, including other Hilton properties, Wyndham, and Sheraton. After some more research I decided to go the Airbnb route.

  • Captain Kirk

    I never thought Hampton Inn was a lower tier brand of the Hilton portfolio. Apparently that isn’t the case. According to the quote: Nassetta said a huge swath of customers cannot afford to pay room rates at its lowest-price chain, Hampton Inn, an upper-midscale brand that was initially targeted at the midscale segment “but has grown up out of it.” An upper midscale brand? I beg to differ. I have stayed at a few Hampton Inns over the years and always had a decent stay but never considered them “upper midscale”. I also despise wall A/C units.

    I am loyal to Marriott as I find my elite status is very valuable with them. They have a great mix of brands and have a property basically anywhere in the U.S. I could possibly want to visit. I agree, the Residence Inn brand is pretty great, even for a one night stay. Marriott and SPG offer better properties and amenities for my money so I use them.

  • Bill

    I find it hilarious that Hilton and the consumer market would ever believe that Hampton Inn is a upper-midscale or upperscale hotel brand. Hampton Inn looks like a midscale. Its amenities are midscale. Its locations are mostly midscale. It’s just charging prices that are not midscale.

    I’d take a Four Points over Hampton Inn any day…and usually do. I also agree that Residence Inn and even Courtyard are better than Hampton…though Courtyards have similarly gotten way too pricey for their britches IMO. I now avoid Courtyards almost as much as I avoid Hampton–since there usually is a Residence Inn or Four Points that costs less and offers very comparable (and sometimes better in the case of FP) amenities.

  • omatravel

    I’m thoroughly confused here by Nassetta’s comments. Hampton Inns are exactly a midscale brand and offer midscale to lower midscale quality stays. Hyatt Place and 4 Points are examples of an upper midscale brand.

    I agree with Nassetta that they have gotten too expensive over the past few years. In general though this is due to an overall lack of beds in many markets compared to demand not because of brand positioning. If the concern is that they are pricing themselves out of the midscale market, why not simply put more beds in the market?

  • Bob

    What business traveler believes that Hampton Inn is an upper-midclass brand? It is a mid-class brand at best, just one step above your average motel.

    The food at the Hampton Inns are mediocre at best with fake eggs, cheap fruit and juice. The rooms are average, but comfortable. Most of the Hampton Inns I’ve stayed at have been well-priced, with a few that were definitely over-priced but understandable given their location.

  • Rapid Travel Chai

    @Bill – Courtyards not for me, the annoying modern-style lobbies with the dumpy rooms and ‘king’ beds that don’t seem it, would need free breakfast and better rates for me to consider.

  • Jen

    If you can’t afford it, then it’s NOT truly midscale!! If you are not in the hospitality business then you probably don’t know the proper classifications of hotels. (Most)Hampton Inns have been remodeled and increased in price to fall into the upper midscale. This means it is above a regular midscale, but still midscale! True midscale hotels are La Quinta, Best Western, Red Lion and Sleep Inn. Would you ever stay at those? I know I typically do not. They whole market lacks true midscale- something people (millennials especially) can afford in order to travel more and compete with AirBnB.

  • Jim Mapel

    I’ve stayed at Hampton Inns for years. I’ve seen the price of my favorite property in Eagan MN increase to $150 a night! Will no longer return as they have priced themselves out of the market.