Hilton’s Asia Pacific Growth: The Brands Driving it and the Focus on India 

Hilton’s growth strategy in Asia Pacific is multifaceted. It is the fastest growing hotel company in the region, with almost 1 in 4 hotel rooms under construction bearing a Hilton flag.

As of the first quarter of 2024, Hilton had 801 operational hotels, 892 in the pipeline and is on track to surpass 1,000 hotels by 2025, according to Clarence Tan, senior vice president, development — Asia Pacific at Hilton.

Tan also noted that there’s significant growth potential for Hilton brands across Asia Pacific. “We currently have 12 brands in the region, and we need to introduce some of our new brands as well.”

The Rising Middle Class

He further noted that Hilton is committed to a capital-light growth model, strategically deploying the right brands in the right locations to maximize owner returns.

Significant demand in the focus service segment, driven by intra-regional travel, has been propelled by Asia Pacific’s burgeoning middle class. This demand has boosted Hilton’s focused service brands, such as Hilton Garden Inn and Hampton by Hilton.

“We’ve seen growth in China, particularly with our focus service brand, starting with Hilton Garden Inn, followed by Hampton, and most recently, Home2Suites,” Tan said.

Also, in June 2024, Hilton introduced Hilton Garden Inn-Gen A, a new regional prototype for Greater China. The company is also expanding its presence in the full-service segment, with its flagship brand entering new markets and key gateway cities. Hilton Dili Palm Springs, set to open in 2024, will be the first international hotel in Timor-Leste, while the newly opened Hilton Kathmandu marks the company’s first property in Nepal.

The Luxury Focus

Hilton is expanding its luxury presence in Asia Pacific, which now comprises 40% of its luxury portfolio and is projected to account for half of its global luxury pipeline. The company plans to double its luxury brand presence in the region over the coming years.

Hilton operates three luxury brands in Asia Pacific: Alexa, Conrad, and Waldorf Astoria and some of the key upcoming additions include properties in major cities such as Tokyo, Osaka, Sydney, and Hanoi. The hotel company also aims to significantly increase its footprint in India.

The acquisition of NoMad Hotels marks Hilton’s entry into the luxury lifestyle segment. NoMad, known for its playful and restaurant-centric approach, complements Hilton’s existing luxury brands. The plan is to expand NoMad across key regions, including the U.S., Europe, and Asia Pacific.

“We are ensuring that the NoMad properties maintain their unique identity and do not become too similar to our existing luxury brands,” said Tan.

Hilton’s recent partnership with Small Luxury Hotels is a strategic move to address market gaps for unique, personalized experiences that Hilton’s current offerings do not fully cover, he added.

Eyes on India

In India, Hilton is counting on its focus service brands, such as Hilton Garden Inn and Hampton by Hilton. Hilton aims to grow its presence in India to 75 hotels in the coming years.

“With the new brands, the relaunch of Hamptons in India and the launch of new focus service brands, the future for India remains very bright. I’m now looking at whether I would do franchising in India, predominantly in the focus service brands,” Tan said

According to Tan, India provides a lot of growth potential for Hilton: “The world’s largest population, a rising middle class, and the huge infrastructural investments in the country on roads, airlines, airports, tech centers and then of course, the market is undersupplied in terms of hotel rooms.”

Last year, Hilton did a roadshow in India to launch the Hilton Garden 3.0 brand outside of China, and Tan said that has led to a few signings and a lot more interest in the brand. “From a signing perspective, we signed eight hotels last year, and we’re on track trying to do the same, if not more, this year.”

Franchising and Loyalty Programs

Franchising has been a crucial growth driver for Hilton, with plans to expand its franchise model in Greater China and other Asia Pacific markets. “Around 90% of our business in the U.S. is franchise. In Europe, it’s about 50%. There is growing demand for franchising as Asian countries become more affluent and owners become younger,” said Tan.

Hilton has also announced the expansion of its franchise model in Greater China into the upscale full-service segment with DoubleTree by Hilton.

Hilton’s recent partnership with Starbucks China also highlights its approach to expanding its brand influence. This collaboration allows Hilton Honors and Starbucks Rewards members to earn and redeem points across both platforms.

Regarding the Starbucks partnership, Tan said, “While it’s great that we have 190 million Hilton Honors members, it’s also important that the earn and burn ratio continues. Members need to see value in Hilton loyalty points as a form of currency.”

Talent Development and Retention in Asia

However, training workers remains a critical challenge in the Asian hotel industry. Tan said the company has introduced several initiatives to engage and retain young talent, including flexible gig economy models and innovative recruitment methods.

He said Hilton addresses these through comprehensive training programs and initiatives like Hilton University, offering bite-sized online learning for employees at all levels. “The company also embraces innovative recruitment strategies, such as video interviews via TikTok in Australia, to engage young talent,” Tan said.