Hilton creates new brand aimed at millennials

Hilton Worldwide has young people in mind with a new affordable brand called Tru which will start coming on stream by the end of the year. The re-entry into the midscale hotel market with the company’s 13th brand was signalled at Monday’s American Lodging Investment Summit held in Los Angeles.

Hilton’s Tru brand is its 13th and will concentrate on the young traveller in the hope that it can also build brand loyalty Image by Michael Coté / CC BY 2.0

USA Today reports that the company has signed 102 hotels at this stage with a further 30 properties at different stages of approval in a number of cities, including Chicago, Houston and Atlanta.

Hotel rooms will cost less under Hilton’s new plan with its Tru brand range. Image by PortoBay Hotels & Resorts / CC BY 2.0

Christopher Nassetta, Hilton’s CEO, said he believes that Tru will turn out to be his firm’s bigger brand over time. He said that rather than take over an existing brand, Hilton has decided it is preferable to begin its own in the midscale segment, which accounts for 40% of all hotel room demand. While rates at Tru will vary from city to city, all are expected to cost slightly under $100 per night.

The new brand will take in all age groups but wants to concentrate on appealing to a “millennial” mindset. He said the price will most likely be very attractive to young people travelling for both business and pleasure. The CEO explained that currently there is a big demand in this segment which is not being served.

The Senior Vice President at Lodging Econometrics. Bruce Ford, says there could be a niche for the new brand because the older line with limited service could not match the innovation that Tru could bring out of the box. According to Phil Cordell of Hilton Worldwide, they won’t take over another hotel brand and then rebrand it as a Tru.