What are the specific obligations of a Crowne Plaza franchisee regarding the use of advertising materials, as mentioned in Item 11, and how do these relate to the franchisee's marketing obligations outlined in Item 9?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
You may conduct local and regional marketing programs and related activities, but only at your expense and subject to Holiday's requirements, such as proper usage of its trademarks. Holiday may make reasonable charges for optional advertising materials that you order or use for these programs and activities.
All Crowne Plaza brand group Hotels must participate in the CP-HMA. Payments under the CP-HMA contract must begin within 60 days of the opening of the Hotel (see Note 9 in Item 6). The CP-HMA is an association of Crowne Plaza Hotels and Resorts in the Americas, and exists to develop, fund and implement programs for the direct benefit of Crowne Plaza brand group hotels, suites and resorts. An advisory board elected by the association membership governs the CP-HMA. There are no written documents which govern the CP-HMA other than the CP-HMA contract, Paragraph 3.B(1)(f) of the License and the Standards (which require participation in the CP-HMA). The CP-HMA prepares annual financial statements and makes them available for review by participating licensees. Holiday, the CP-HMA advisory board, and the IHG Owners Association, acting jointly, have the power to make changes, dissolve, merge or form additional CP-HMA programs.
Holiday pools Services Contributions from Crowne Plaza brand group hotels together with the Services Contributions from hotels operating under one or more of Holiday's and its affiliates' current and/or future portfolio of brands (see Item 1) ("IHG Portfolio Brands").
The Services Contributions will be distributed for marketing, reservations, IHG System Fund Activities (defined below), and other related activities which, in Holiday's and its affiliates' sole business judgment, support marketing, reservations and other related functions and/or purposes on a local, regional, national, continental or international basis for all, or a group of, IHG Portfolio Brands. "IHG System Fund Activities" means various activities and arrangements organized and operated by Holiday and its affiliates to provide loyalty marketing services, distribution marketing services, brand marketing services and other marketing and related programs and services for Brand System Hotels and the IHG Portfolio Brand Hotels.
What This Means (2025 FDD)
According to the 2025 Crowne Plaza Franchise Disclosure Document, franchisees have specific obligations regarding advertising and marketing. While Holiday (the franchisor) uses the Services Contribution for marketing and related activities, these contributions are not intended to benefit any specific hotel or market, and Holiday has no obligation to spend amounts proportionate to a franchisee's contribution. Franchisees can conduct local and regional marketing programs at their own expense, but these are subject to Holiday's requirements, including proper trademark usage. Holiday may charge for optional advertising materials used in these local programs. All Crowne Plaza hotels must participate in the CP-HMA (Crowne Plaza Hotel Marketing Association), which develops and funds programs for the direct benefit of Crowne Plaza hotels.
The franchisee is responsible for maximizing the Gross Rooms Revenue of the hotel through sound marketing practices. They cannot engage in any conduct that reduces Gross Rooms Revenue to benefit other business activities. The franchisee may accept optional products or services from IHG (InterContinental Hotels Group), either under current practices or as developed in the future, which may involve additional charges.
In summary, Crowne Plaza franchisees are obligated to participate in brand-wide marketing initiatives through the Services Contribution and the CP-HMA, while also having the option to engage in local marketing efforts that adhere to the franchisor's standards. The franchisee bears the costs for these local activities and must ensure they align with the franchisor's brand guidelines. The FDD excerpts do not specify the details of Item 9, so it is not possible to compare the obligations outlined in Item 11 to those in Item 9.