The ultimate brand builder?

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The busy bees at Starwood Hotels are at it again. The company will announce this morning that it is hooking up with Yahoo! to test an Internet lounge concept at two Sheraton hotels. The lounges will have workstations and spaces for guests to plug in their laptop computers. Ho hum, you say. The kicker, and the key to the program, is that Internet access in the lounges, including wireless hookups, will be FREE, FREE, FREE.

The partnership also includes a test at two other Sheratons of in-room Internet access. In this wrinkle, guests who log-in to the web on their laptops will first see a customized Yahoo! home page. Again, access to the net will be free.

For Starwood, the beauty of the deal is two-fold: First and foremost, the properties will be offering the service most desired by business travelers—high-speed Internet access—at the price point they want to pay—nothing. The notion of free Internet especially appeals to the up-and-coming pool of Gen X travelers, most of who believe—thanks to companies such as Yahoo! and Google—that the Internet is a public asset, like a park, a library or an interstate highway, that shouldn't directly cost anything to enter or use.

The scheme also positions Starwood at the forefront of an emerging concept—the power of cross-branded marketing. Sheraton and Yahoo! are two instantly recognizable brands (albeit ones that each appeal mostly to different generations). Put them together and you have clout that exceeds the combination of their individual powers. This kind of thinking isn't unusual at Starwood since the arrival of CEO Steve Heyer and several other executives from Coca-Cola Co. To Heyer and his cronies, business is all about branding, and the lodging industry is no different.

And, of course, the program provides what many hotel guests believes is the ultimate amenity while creating a dynamic competitive edge for the hotel brand.

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