Tom Magnuson, CEO of Spokane-based Magnuson Hotels, says the launch of a new international online travel agency for booking hotel rooms is being delayed until next month because of a higher than expected demand in hotels wanting to participate.
Magnuson, also CEO of a new company called Global Hotel Exchange LLC, had planned a January start to the worldwide reservation platform, www.globalhotelexchange.com, which is designed to allow customers to book hotel rooms based on several weeks of "market-based pricing" without commission charges to those hotels. Consumers pay a $2.99 pass-through fee.
The start date is now planned for early to mid-March, Magnuson says, to accommodate what he says are thousands of hotels signing on to participate, including those through recently formed affiliations with two groups, the California Lodging Industry Association and Independent Lodging Industry Association.
Additionally, Magnuson says he plans soon to launch Magnuson Worldwide as a global holding company that will be the parent for Magnuson Hotels, Global Hotel Exchange, "and some soon-to-be-announced additional companies."
Magnuson Hotels, which he and his wife Melissa started about eight years ago, has grown through its reservation management services, which now include affiliations with nearly 2,000 independent hotel properties and resorts across North America and in Europe. The company also supports client hotels with marketing and branding services.
At the Global Hotel Exchange website's current adoption rate by hotels wanting to participate, Magnuson asserts, "Probably by June, we'll be looking at 10 percent of the global supply, and that would represent about 30,000 hotels worldwide."
He says Global Hotel Exchange is working with both franchise-branded hotels and ones that are independently owned.
"All systems are go," he says. "We just have a lot of hotels wanting to get on board, so we don't want to leave anyone behind. We're working overtime so we can help them out."
Magnuson says that interest in the new hotel booking website is high because hotels are looking for ways to lower costs while also boosting occupancy.
"What they're most interested in is our no booking fees platform," he adds. "Hotel owners absolutely need an alternative to the high cost of commissions from online travel agencies. They absolutely need an alternative to the rising cost of distribution fees in an environment that's stagnating or declining."
He adds, "We have decreased occupancy rates that are going down, but hotel operating costs, every cost, is continuing to rise."
For the Magnuson Hotels business, the company has announced some recent large hotel properties moving over to carry the Magnuson brand.
"These are hotels that have left other larger brands such as Holiday Inn and Best Western, coming on board with our company," Magnuson says.
In January, Magnuson Hotels announced a rebranding of a 144-room, Des Moines, Iowa-based hotel that was formerly a Best Western. The property will change its name to Magnuson Hotel Des Moines Airport. Another property that recently affiliated with Magnuson is a 54-room hotel in Waco, Texas that was previously a Choice franchise, now rebranding as Magnuson Hotel Waco.
The company also announced the rebranding to Magnuson of other properties in December. Those included a 41-room luxury hotel in Paradise, Mich., that was formerly a Best Western for 11 years, now named the Magnuson Grand Hotel Lakefront Paradise. Another property was formerly part of the Choice franchise in Louisiana, a 48-room hotel that's rebranding as the Magnuson Hotel Port Allen.
Additionally, he says Magnuson Hotels recently moved its marketing department to an international office it opened in London two years ago, adding about 12 employees there to boost the office's total work force to about 32. Magnuson and his wife moved there in March 2010 to open the office. About 50 company employees remain in Spokane.
"We have a significant marketing department in London (for) marketing, public relations, our branding, search engine, and social media marketing," he says. "That's not been a loss of jobs in Spokane. We've decided to focus on growing that division over here. Some people moved into different positions in Spokane, and then we added more people over here."