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Hotels Take on New Names and Rebrand for Many Different Reasons

By Courtenay Edelhart, The Bakersfield CalifornianMcClatchy-Tribune Regional News

July 21, 2010--People familiar with Bakersfield's hospitality industry may have noticed a bit of musical chairs going on with the city's hotels.

It started two years ago when the Holiday Inn Select on Truxtun Avenue became the Bakersfield Marriott. About the same time, the Legacy Suites Hotel on Buck Owens Boulevard became Wyndham Garden Bakersfield. The place reverted to Legacy Suites again in April, but that was an interim brand. Next month it will transition to a Holiday Inn.

Now comes the Bakersfield Red Lion, which recently became Hotel Rosedale, a boutique hotel.

What it frequently comes down to is that most hotels are franchises, and for a variety of reasons, franchise owners may choose to change brands.

Often it's a simple matter of cost. A marquee name comes with a hefty price tag, but in exchange for that you get instant name recognition and national advertising and marketing exposure.

"When you go boutique, you have a ton of leg work trying to prove that your hotel is good," said Jignesh Leva, one of the principal owners of what soon will be a Holiday Inn. "When you have an affiliation, that's already there."

You also sacrifice some control, though. The brand dictates what kind of decor you can have, for instance, or what kind of computer network you can install.

That's what turned Leva off on Wyndham. The company had a computer data security breach, he said, but wanted franchise owners to accept liability for it even though they only used the computer system Wyndham had mandated.

In the case of the Marriott, the new name came when the hotel changed owners. Brighton Management sold its hotel to Barney Hospitality Group LLC in March 2008, and it became a Marriott eight months later.

"I think ownership just felt that with the convention center so close, this property would work better as a Marriott," said general manager Carlos Navarro. "It's among the top 10 names recognized worldwide.

"When you think hamburgers, you think McDonald's. When you think soft drinks, you think Coke. Who do you think of when I say the word hotel?"

That's a compelling case for forking over the money for a brand name.

But there's also a downside, said Richard Laermer, a business forecaster and author of "2011: Trendspotting for the Next Decade."

"There's absolutely no differentiation between any of the chain hotels, and there's no reason to have any loyalty to them because they make it almost impossible to redeem anything through their rewards programs," he said.

Hotel chains generally put volume ahead of customer service, Laermer said, pointing to fees for late checkout as an example.

"An independent hotel is going to work that much harder to provide quality service because they're trying to make a name for themselves. They have to be more aggressive and really listen to their customers."

Those who have worked with chains argue just the opposite. A brand won't allow a hotel to operate in its name unless it meets minimum quality standards, whereas an independent hotel is free to run things any way it wants, Leva said.

Neither owners nor management at the new Hotel Rosedale near the Rosedale and 99 highways returned telephone calls to talk about the decision to ditch the Red Lion name. Red Lion's corporate office in Spokane, Wash., also did not return telephone calls.

An owner of the Padre Hotel, the upscale boutique hotel that opened downtown earlier this year, was unavailable for comment.

More than 75 industries operate within the franchising format, according to the International Franchise Association. The association's membership and network encompass some 1,000 franchisors, 350 suppliers and more than 7,000 franchisee members.

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To see more of The Bakersfield Californian, or to subscribe to the newspaper, go to http://www.bakersfield.com.

Copyright (c) 2010, The Bakersfield Californian

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