FILLING A NEED For Sonesta , setting up new brands is a study in owner needs . “ We learned through the course of 2022 that there was a fair amount of interest from existing owners and operators with other flags that wanted to come into the Sonesta family ,” Pierce said . “ And we didn ' t have a brand for them .” Pierce alluded to Hilton ’ s Hampton brand and IHG ’ s Holiday Inn Express as examples . These brands often achieve market saturation and owners seek out alternative flag options for their assets , which is where brands like Sonesta Essential can fill that void .
In the case of Essential , the origin of the brand came about in large part because Sonesta needed a go-to brand underneath Sonesta Select , an upscale , focused-service brand launched in late 2020 . “ We were getting this high level of interest for what I ' ll call ‘ non-conforming ’ properties that didn ’ t work to as a Select ,” Pierce said . Sonesta Select hotels require a liquor license and food on premise , unlike Essential . “ So we didn ' t do a lot of those deals because we didn ' t want to change the Select standards . That ' s what drove the creation of Essential .”
Like the case of Essential , Sonesta needed a brand to complement its highend Royal Sonesta brand . Specifically , something in the popular lifestyle segment . It has that now in The James . “ It is a perfect fit for us ,” Pierce said . “ Because above Royal Sonesta , we really didn ' t have a lifestyle brand .” The Denihan acquisition changed that and Sonesta will look for franchise opportunities .
Meanwhile , Sonesta is still trying to figure out the best way to integrate its acquisition of RLH Corporation . For example , prior ownership bifurcated Red Lion Suites and Red Lion Hotels . “ There is an argument to be made that they should be consolidated back together as one ,” Pierce said of the now 70 hotels .
“ We are looking at what we call rationalizing the brand portfolio . And how do we represent it — not only to the development community , but also to the consumer ,” Pierce continued .
Consider , also , loyalty . RLH still has its Hello Rewards program , while Sonesta has Travel Pass , which is very much a traditional , currency-based program . “ At some point in time , does it make sense to only have one loyalty program throughout the portfolio brands ?” Pierce asked . " We are going through that evaluation process now .”
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