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Online marketing has grown increasingly complex, and within the hospitality industry there is no exception.
Perhaps you’ve heard the topic discussed recently or in the past: “hotel deflagging.” But what does it mean to deflag, and why do owners do it?
Big hotel brands are known in the industry as “flags.” (Most likely due to the company flag fluttering on the flagpole outside a hotel.) Flagged hotels are not owned by a brand, but rather they operate under a franchise agreement with the brand. The definition of deflag refers to the practice of hotel owners becoming independent of their brand franchisers.
In an ideal world, the relationship between a hotel and its brand is a mutually beneficial one. Hotels brands enjoy a constant revenue stream, and hotel owners enjoy the prestige and resources of the brand. In today’s shifting hospitality landscape however, the value of this relationship is changing.
In some cases, brands may decide to deflag a hotel because hotel owners can’t or won’t meet the brand’s exacting standards. For example, Marriott International is deflagging a number of underperforming Sheraton hotel properties, eliminating about 10,000 rooms from its portfolio by the end of this year. In other circumstances, it’s the hotel owners who decide to deflag their property.