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Travelodge to tempt budget market with £25m campaign

08 May 2014 by
Travelodge to tempt budget market with £25m campaign

Travelodge is set to launch a £25m advertising campaign, the largest in the history of the budget hotel group.

Set to premiere on Saturday evening during ITV's Britain's Got Talent, the campaign will be the first major initiative from Peter Gowers, the new chief executive of the 513-strong group, who was appointed to the role six months ago. It is hoped that the four-month television, digital and print campaign will be viewed at least five times by 14.5 million adults.

"Travelodge has been quiet for four years and now we are going to make a lot of noise and inspire people to Get Up and Go," said Gowers, referring to the campaign's headline, which is aimed at getting people to visit a specific destination where a Travelodge is located, rather than being centred on the advantages of staying in the brand.

The timing of the campaign fits into Travelodge's current £57m refurbishment programme which will see 80% of the group's estate overhauled by the end of the year, with the introduction of a new bedroom concept featuring bespoke beds made by Sleepeeze.

The rest of the portfolio will be renovated next year, while all new hotels - including the 15 scheduled to open this year - will feature the new design.

Travelodge's new high-profile persona follows a difficult two years for the company which involved a financial restructuring of the group in 2012, resulting in its £635m debt being reduced to £385m, and the off-loading of 49 hotels that were no longer considered financially viable after it entered into a Company Voluntary Arrangement (CVA).

Gowers said Travelodge currently offers one of the best value hotel options on the market, with 70% of its bedrooms selling for less than £50, which he believes is generally around £20-30 lower than its major rival, Premier Inn, which is the UK and Ireland's largest hotel company with 671 properties.

"Premier Inn is no longer such a value offer - there is currently a gap of around 20% between their rates and Travelodge's rates in London. For guests who don't want the extra things offered by Premier Inn, Travelodge is a better value stay."

Gowers joined Travelodge after a two-year break from the hotel industry as chief executive of Safestore Holdings, the UK's largest self-storage operator, having previously been based in Singapore as the chief executive, Asia-Pacific for IHG.

"My time out of the industry was hugely valuable as it gave me the opportunity to think as a customer," he explained. "I wanted to join Travelodge as it is the iconic value hotel brand in Britain and there was the opportunity to take it forward and modernise it for the future."

Gowers said that Travelodge had out-performed the revenue per available room average growth rate of nearly 10% during the first quarter of 2014.

Travelodge opens £11m flagship hotel in Manchester >>
Travelodge opens in historic Southport property >>



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