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The hotel industry used to depend on the hotel brand mostly. Of course, the service quality plays a great role in the hotel brand leading or loosing position. However, hotel industry is highly competitive and more was needed than just a quality a

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

nd the brand name. Hilton designed a custom loyalty program that helped it to save the leading position in the market. Hilton HHonors was created to build up the customer loyalty to the hotel brand worldwide.

By HHonors program, the hotel execut

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

ives could use a thorough database to customize guests' hotel experiences and the feedback received enabled them to provide effective customized services for each guest. This program was under good operation from the day it was born. Between

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

997 and 1998, Hilton experienced a nearly 18% increase from the utilization of HHonors.

But the competition is really severe in the hotel industry. Hilton's big competitors have similar loyalty programs. Starwood announced its "Starwood Prefe

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

rred Guest Program" which includes Westin Hotels Resorts, Sheraton Hotels Resorts, Four Points, Caesar's and W hotels, all together including over 500 properties world wide. Having few limitations and spending money on an advertising campaign,

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

Starwood was obviously trying to place itself on top of the market.

According to Hilton HHonors Worldwide's income statement 1998, the company earned revenues of $69,837 as well as spent expenditures of $69,438, only getting an net income of

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

a mere $399. This was not very bright to Hilton HHonors. Although Starwood announced that it would increase expenditure on a huge ad campaign to promote its Preferred Guest Program, Hilton would make a mistake to involve itself into this ad c

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

ampaign. Hotel profitability is very sensitive to revenue. The purpose of the loyalty program is to reward loyal customers with preferential treatments and ensure their continual loyalty and long-term revenue. The ultimate goal is to make prof

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

its. If the program will not yield sufficient profits, it must be a failure. Furthermore, involving into the advertising game in the same time with its competitor is not a proper choice. Too many information will add much water down the desir

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

d impression.

There was also a "hardware & software" problem in Hilton. The hardware problem was Hilton's relatively limited network size and distribution. Despite the HHonors brought increase in stays, more than half of HHonors member stays

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

went to competing chains annually. However, the covering of Starwood was very wide and most of them joined Preferred Guest Program. The software was the loyalty program of Starwood was much friendly to use and get rewards. From the above ment

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

ioned, it could be conclude that Hilton should not compete point for point with Starwood program, also the other direct competitors.

From the historic operation status of Hilton HHonors, it had been successful. First, its revenues had been in

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

he region of $158 per night per guest, and occupancy had exceeded break-even. Second, it had established close relationships with franchisees. The franchisees identified with building long-term customer loyalty, understood the value of HHonor

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

s program, and were eager to become membership. Third, Hilton was the only hotel chain to offer Double Dipping. And Double Dipping brought win-win result for Hilton and its collaborating Airline partners. Hilton would get more customers' infor

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

mation or contact directly with the customers from airline frequent flyer programs.

The hotel industry survey showed that the estimated market size for frequent guests program was worth $11.1 billion and the average member belonged to 3.5 pr

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

grams. Within that market, Hilton HHonors members spent about $4.6 billion on accommodation per year, not all of which was with Hilton. The Hilton HHonors' members were a huge potential pool, from which Hilton should get more loyalty. Facing t

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

he action of its competitor, Hilton should not engage itself into the price war and advertising campaign. Hilton should take a different position and hold on to its members and keep differentiating HHonors from Starwood and other competitors.

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

According to HHW conjoint analysis, the most important features of a hotel program were room upgrades and airline miles, followed by free hotel stays, and other on-property benefits and services. It must be an optimal way to focus in these ar

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

as and keep making more special features to attract more customers to experience. Meanwhile, using database of Hilton HHonors and cooperating airline partners would keep long-track record of customers' preferences as well as dislikes. That wo

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

uld successfully customize each guest's experience and offer the most efficient service for its guests. Consumer satisfaction and words of mouth would be a more effective and influential ads rather than huge-investment on advertising campaign

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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