LOS ANGELES—G6 Hospitality is continuing its quest for the international footprint that its own executives and those from parent company Blackstone laid out nearly five years ago.
2017 marks the fifth anniversary of Blackstone’s $1.9-billion acquisition of Dallas-based G6, which includes the iconic Motel 6 brand as its primary brand. After focusing its international expansion efforts on Latin America for the past few years, the company is setting its sights on Asia.
During the recent Americas Lodging Investment Summit, the company announced it signed a deal with Auromatrix Holdings to develop 40 properties under the Motel 6, Studio 6 and Hotel 6 brands in India by the end of 2022. Exact locations of the hotels are still being negotiated.
“That market is growing immensely; there could be an appropriate application for both Motel 6 and Hotel 6,” said Lance Miceli, G6’s EVP and chief marketing officer, during an interview conducted during ALIS.
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The use of Hotel 6 was launched in Latin America because the word “motel” isn’t well known there. That’s not the case in India, Miceli said.
“With India there’s a greater degree of recognition of Motel 6 because a meaningful number of our franchisees are of eastern Indian descent,” he said.
G6 has more than 1,300 properties in its system.
Dallas-based G6 Hospitality traces its roots to the original Motel 6 property in Santa Barbara, California in 1962. The rate for the hotel was $6 per night. (Photo: G6 Hospitality)
Technology improvements
In addition to growth on the physical side of the business, G6 is also looking toward expansion in its digital platform.
Miceli said G6’s primary focus remains on organic growth and expansion by leveraging digital aspects of the business for guests and owners. G6 implemented a single codebase to its mobile site in the fourth quarter of 2015, which has improved its reach, he said.
“The challenge is you have to constantly enhance, interact and improve the site,” he said.
In September the company introduced its first proprietary cloud-based revenue management platform called “G6 Revenue Optimization Workspace” (it calls it G6ROW). The tool provides real-time rate and inventory management from any device, anytime.
“For the first time, we can yield inventory into the demand curve,” Miceli said, adding that the business intelligence tool pulls in forward-looking data as well as competitors’ pricing.
The system allows franchisees to retain ownership of their own revenue plans—it’s simply a real-time tool that allows them to stay on top of it, he said.
“It’s not a black box where it sends a recommendation … it sends an alert,” he said. “A person then takes action to make the task happen.
“They can manage the hotel from out on the property, in the office or off-site via phone,” he added. “It doesn’t require that you’re tethered to a machine.”
The introduction of the tool reflects the quick pace of technology growth in the hotel industry, Miceli said.
“The evolution in technology, it’s been a real sea change,” he said. “Go back five or 10 years and everything was purpose build, closed loop, rigid. There were some fundamental limitations to the way in which revenue managers could yield.”
The turning point came when the cloud was introduced, Miceli said.
“Understanding the bandwidth and speed if you engineer correctly and can put systems and intelligence in the cloud, the pipe gets bigger,” he said. “As it gets bigger, you’re able to carve up the data and put better info in the hands of people that know how to price in the day for the day. The speed and precision has accelerated immensely.”
That doesn’t mean it’s a situation in which someone sets it and forgets it, he said.
“With great power comes great responsibility,” Miceli said. “You still have to hire the right people, you have to train them, make sure you have the correct operational procedures to make the right decision. There needs to be a strategy applied.”
The power of mobile
The company is also focusing on the customer interaction via its mobile app. Reducing the friction of the guest experience on the app is an important goal, he said.
“They have to be able to execute (a transaction) in fewer touches … find, select and book a room within three or four touches if they’re signed in,” Miceli said, adding that only showing properties located in the direction the guest is headed while driving and offering a preferred rate for registered guests who are signed in to the app are important elements in making the process easier for consumers.
A total of 65% of G6’s digital revenue is generated by mobile devices—14 months ago it was 35%, Miceli said. It’s more important than ever to provide guests with their preferred method of booking.
“The booking window is relatively narrow,” he said, adding that many of G6’s bookings are same-day transactions. “That’s where the app comes into play because it’s in the market.”
The company is in the process of developing a broader database so it can identify preferences, such as floor and bed preference and driving directions.
“Reducing the friction, making it easier for guests—all of that together has driven demand,” Miceli said.