Press Release
November 17, 2000
STATE COLLEGE, PA -- Early in the 1990s, before all-suite hotels became one of the fastest-growing segments of
the nation's highly competitive lodging industry, Shaner Hotel Group, a small, privately held hotel owner-operator
and development company acquired 12 Hawthorn Suite hotels, the single largest Hawthorn collection under one owner.
The brand became the foundation of the company's extended-stay product line, anchored by a cluster of seven properties
in Dallas, Austin and San Antonio, Texas.
From 1992-98 the properties experienced robust business. But by 1999, with the explosion of limited-service and
all-suite hotels in the booming Texas marketplace, Shaner executives faced the reality of declining sales figures.
The company was forced to adopt a "ready, aim, fire" marketing strategy aimed at a single primary objective:
regain and maintain the core customer base upon which its extended stay product was established.
"We found that this customer 'foundation' was being eroded by the new 'all-suite' brands that were targeting
the transient versus extended-stay guest," said Wendy Magnuson, vice president of operations for the company's
Austin-based extended stay division.
"At the same time, many full-service properties were competing with us directly by offering weekly, as well
as, daily rates. And, to make matters worse, we detected a lot of confusion in the mind of the consumer,"
she added. "We found that consumers were not differentiating between our extended-stay product and the transient-based
all-suite product, even though amenities and services varied significantly."
COMPETITIVE ADVANTAGES
What troubled Magnuson was that business had fallen despite the fact that Shaner's extended-stay Hawthorn Suites
products offer the consumer more services and amenities than its all-suite competitors.
The company defines its product advantages as:
"We feature a full-service breakfast from 6:30 a.m. to 9:30 a.m. every weekday morning, and until 10:30
a.m. on weekends," Magnuson said. "Our manager's receptions, featured every Monday through Thursday evening,
include a hospitality hour with a light dinner buffet."
"Furthermore, our guests enjoy a friendly staff and friendly service 24-hours a day, not just until 6 p.m.,"
she added. "We get to know our guests by name," she continued, "and try to make them feel at home
while away from home."
"Typically, our customer is someone who stays with us for five or more nights," she added.
SOLVING THE PROBLEM
To jump-start its lagging sales figures, Shaner developed a multi-phase direct marketing campaign designed to effectively
reach extended-stay decision makers. "We focused 100 percent of our marketing strategy for 2000 on the extended
stay portion of our business," Magnuson said. "Our goal was to bring our extended-stay business mix back
up to the 50-55 percent level, a percentage we had not enjoyed since 1997."
The company:
"The entire sales staff was retrained on product benefits and extended stay sales techniques," Magnuson
said. "Relationship-building was our primary objective. We wanted to let our former and prospective customers
get to know us better through direct sales calls, site visits and a follow-up telephone campaign aimed at assessing
the client's immediate and future lodging needs."
As a result, Shaner has strengthened relationships with its client base, and its extended-stay division leads the
company in sales and profitability for the year 2000.
"With our new strategies in place, we have been able to sell over 25,000 more rooms through September, increase
room revenue by 9.9 percent and operating cash flow by 12.3 percent," Magnuson said. "We look forward
to the trend continuing through 2001."
Shaner Hotel Group is a privately held lodging company headquartered in State College, Pa. It owns and operates
54 hotels, representing 11 brands, located in 23 states. Its portfolio includes full-service, limited-service and
extended-stay products.
Editor's Note: How do you recapture market share that has gravitated to new, aggressive competitors? In 2000, Shaner
Hotel Group implemented an aggressive direct marketing campaign to regain extended-stay market share and enhance
customer loyalty in several key fast-paced, highly competitive Texas primary markets. Following is a case study
on how the company's extended stay division jumped to first place in total corporate sales for the year 2000.
Contact:
YP&B Public Relations Orlando, Fla. Suzanne McGovern or Loretta Dodson 407/875-1111