Marriot International

Marriott International grew to an international hospitality giant from humble beginnings, as a single root beer stand started by John and Alice Marriott in Washington, D.C. during the 1920s. The Marriott's added hot food to their root beer stand, renamed their business the Hot Shoppe, which they incorporated in 1929. They began building a regional chain of restaurants. As the number of Hot Shoppes in the Southeast grew, Marriott expanded into in-flight catering by serving food on Eastern, American, and Capital Airlines beginning in 1937. In 1939, Hot Shoppes began its food service management business when it opened a cafeteria in the U.S. Treasury building. The company expanded into another hospitality sector in 1957, when Hot Shoppes opened its first hotel in Arlington, Virginia. Hot Shoppes, which was renamed Marriott Corporation in 1967, grew nationally and internationally by way of strategic acquisitions and entering new service categories, and by 1977 sales topped $1 billion.

In the pursuit of continued growth, Marriott continued to diversify its business. The 1982 acquisition of Host International made it America's top operator of airport food and beverage facilities. Over the course of the following three years, Marriott added 1,000 food service accounts by purchasing three food service companies, Gladieux, Service Systems, and Saga Corp. Determining that its high penetration in the traditional hotel market did not offer many opportunities for growth, the company initiated a segmented marketing strategy by introducing the moderately priced Courtyard by Marriott hotels in 1983. Moderately priced hotels comprised the largest segment of the U.S. lodging industry, a segment filled with established competitors such as Holiday Inn, Ramada, and Quality Inn. Research conducted by Marriott registered the greatest consumer dissatisfaction in the moderately priced hotels, and Courtyard hotels were designed to offer travelers greater convenience and amenities, such as balconies and patios, large desks and sofas, and pools and spas.1

Early success with Courtyard prompted Marriott to expand further. In 1994, Marriott entered the vacation timesharing business by acquiring American Resorts Group. The following year, the company purchased Howard Johnson Company, selling the hotels and retaining the restaurants and rest stops. In 1987, Marriott added three new market segments: Marriott Suites, full service suite accommodations; Residence Inn, extended-stay rooms for business travelers; and Fairfield Inn, an economy hotel brand. A company spokesman explained this rapid expansion: “There is a lot of segmentation that's going on in the hotel business. Travelers are sophisticated and have many wants