Complete Rob Goodman Interview with Stephen Holmes

CHRYSLER CLASSIC OF GREENSBORO
October 06, 2006

An interview with:
STEPHEN HOLMES

ROB GOODMAN: Alright. We have Steve Holmes, the President, Chairman and CEO of Wyndham Worldwide.

Q Steve, Jonathan Lowe from News 14.

How do you expect the Wyndham to be different from the Chrysler Classic and then, secondly, what do you expect to bring to the Triad next year?

STEPHEN HOLMES: Well, there's a couple of big changes as Wyndham takes over sponsorship of the event. The Wyndham Championship will be held in August, as I'm sure you're all aware, and it will be held as the final event of the FedExCup qualifying tournament so it will be a major event within the PGA Tour calendar as the FedExCup qualifying comes to a head.

So that is, for us, very, very exciting to be part of that and to see it moving to August is a real plus for a lot of things, including beating some of the cold weather you have right down here right now.

What we're going to bring to the Triad is a lot of excitement, lot of energy, I think. We're very, very excited to be part of this event.

We looked for a long time to determine where we wanted to put our effort following becoming a separate public company in August of this year.

As Wyndham Worldwide, we started looking around to see where we wanted to kind of put a stake in the ground and say this is what we want to stand for and this is what we mean and to be part of an event that is really run by a charitable foundation is a real plus for us.

We kind of build our business as one on one of your core values of giving back to the community so being in an environment where the event is not only a great commercial event for us but also one that supports the community is really exciting for us.

Q Steve, when did you first contact IGT?

STEPHEN HOLMES: When did we first contact IMG you mean?

Boy, boy, I don't remember the date. It was several months ago. We actually contacted them, not in reference specifically to this event, but obviously IMG is a leader in sports marketing, was a group that we reached out to just to kind of get some ideas and thoughts.

They introduced to us this idea. We got to understand more about the FedExCup Series and the importance that this event is the final event would have in the FedExCup Series and that really created the excitement for us and got us really hooked on this.

Q So your initial reaching out to them was not for a PGA Event?
STEPHEN HOLMES: Well, we felt that it was probably would probably end up being a PGA Event, frankly, because the demographics line up so well for our marketing base.

We're marketing as Wyndham Worldwide, we market to consumers in general but we market to a lot of leisure travelers who stay at Wyndham Hotels or any of other branded hotels, as well as people who look at buying timeshare who are very much in the demographic that matches with the golf demographics.

So when you step back and look at it, it probably is one of the greatest connections demographically we could make with our customer base. So we were focused on probably doing something in the golf arena but we were open to any other ideas that they came up with.
Q Does Wyndham own any golf resorts and if you do, would you ever consider building a golf resort/hotel in this area?

STEPHEN HOLMES: We don't we don't own any golf courses, we don't own any hotels, frankly. We're a franchisor and manager of hotels.

We have a number of our timeshare resorts that are located on golf courses. The Glade in Tennessee. There's a number of our resorts that are affiliated with golf courses, but your question of would we consider building a hotel resort golf, hotel down here in this area?
Again, we're not developers of hotels. We're managers of the brand. The Wyndham brand, the Wingate brand, Super 8, Days Inn, Howard Johnson, Ramada, we've got nine brands that are part of our portfolio.

We manage those as franchisors with franchisees who actually own and manage the hotels.
Would we encourage somebody to build a Wyndham hotel down in this area? Absolutely? It's a beautiful area and has a lot of great commerce so it's a great market for us.

Q Will the golf tournament be here next year at this golf course?
STEPHEN HOLMES: There's speculation that's been swirling around. Frankly, I'm not the one to ask that of.

I think the right people to talk to about that at the right time is the Board of Directors and the PGA Tour which really is the one who sanctions locations.

Q One of the things that some people talk about, if four years from now when this contract expires is to keep it a step above some of the other competitors is maybe a bigger purse.
Are y'all interested in make a bigger financial commitment? I know you're locked into this four year period.

STEPHEN HOLMES: Four years is a long time. I don't know what we'll be looking at four years from now. We expect to get a great business benefit from the association of the Wyndham Championship with the PGA Tour and with Greensboro.

We have some roots in Greensboro through the Richard Petty Association with children down here. It's one of the great, one of the great organizations that we're involved with.
So Greensboro has a place in our heart and we'd love to see this become even a more successful tournament, if possible. But what's going to happen four years from now, you know, your guess is probably as good as mine right now.

Q Here's an easy one for you. What are you most excited about as far as coming to this area, bringing a PGA Tour to this area, if anything?

STEPHEN HOLMES: Well, I think one of the things that really excites us about it is that this is a large market for our customers.

People who buy timeshare, either under the Fairfield name or Trendwest name, a lot of them are from this area. It's an area that a lot of our very loyal and happy customers live and so we're happy to be in an area that has a large customer base.

In addition to that, you know, just the tradition. I love history, I love the traditions that exist within golf. You're talking about a tournament here that's been around for nearly 70 years and there aren't very many like that.

So, to be associated with an event that has such rich, deep history, we're very proud for the Wyndham Championship to be part of that.

Q Were you surprised or motivated anymore by Crowne Plaza and their deal down in Dallas?
STEPHEN HOLMES: No. It really, frankly, wasn't even on the radar screen until after we made our decision on this opportunity.

We're really focused on what's right for Wyndham Worldwide and we are a new public company just launching on August 1st of this year on the New York Stock Exchange.
While we're new, we're not small. We've got a market cap of about $6 billion so we're a large company but we're a new company.

Our focus really over the last several months in preparation for spinning off and becoming a separate public company was to find the right platform for us. What other people are doing wasn't really didn't really play into our decision process.

Finding something that had great community attraction like this tournament does and the local market but also has such a great platform as the final tournament on the qualifying round of the FedExCup for next year really made it important for us to bring the Wyndham Championship here and really put our name out in front of consumer.

Q Have you ever sponsored a golfer, sponsored a tournament on television, commercial
STEPHEN HOLMES: Have we ever sponsored a golfer or tournament hat? There's some golfers who wear some of our product, not the Wyndham product. We have a lot of different sponsorships through our various brands, Super 8 sponsors NASCAR. It happens to be well aligned with the customer base of Super 8.

We have Fairfield has had its logo on some apparel of PGA Tour professionals.
But never to the degree that we're looking at here with the Wyndham Championship in Greensboro.

Q You said that you were interested in title sponsorship of a PGA Event. That was very intriguing.

Were there other events you were looking at or pretty much the only one or your radar?

STEPHEN HOLMES: Golf?

Q PGA Event.

STEPHEN HOLMES: There's a couple others we looked at, yes, over last six months or year that we thought about and looked at and we've talked to people about possible sponsorships.
This one happened to just click with us perfectly and so when IMG brought this forward as an opportunity, we really gravitated towards it very, very quickly but we did look at other ones.

Q You mentioned the history of this event.

There's a lot of oldtimers around here are sorry to see Greensboro leaving the name of the tournament.

Was that ever any part of the negotiations as to leaving or somehow incorporated Greensboro into the name?

STEPHEN HOLMES: It wasn't because and probably because one of our requirements in looking at a sponsorship opportunity was to get the Wyndham Championship and Wyndham name out there as the event. There will always be the history of the Greensboro events in golf and this is a continuation and extension of that.

But we really were looking at the opportunity to get the Wyndham name out in front of the consumer.

So, frankly it didn't come into the negotiations as far as I was aware because it was a requirement of ours coming into the discussions.

Q How important is it to get a strong field here in the future for this tournament's success? What do you think your company can do to support that?
STEPHEN HOLMES: Well, we'll do everything we can to make this event wildly successful and attractive to the Tour Professionals.

Moving it to August helps, clearly. And I think with the buildup of the FedExCup Tour, that certainly will put some momentum behind it but we really want to make sure that this is an event that attracts the Tour Professionals, that it's a showcase for them and it's an opportunity for them to really enjoy the event.

So, we've begun talks about what we can do to add I'm not going to talk about anything specific right now but to add more excitement and make this an event that the pros really want to come and play at.

To answer your first question, having a big field, a power field is obviously very important. From a marketing standpoint, you know, there are Tour events that have the top players and Tour event that don't have the top players.

The top players drive the television ratings and is really what's going to drive the greater exposure. We would love to see a large field, large, great field.

Q Will this event be already for you like many other sponsors in the past of golf tournaments, be a big party for your staff, your executs and all your customers and suppliers down the line?

STEPHEN HOLMES: Well, I don't know if it will be a big party. It will probably be a lot of work for them because we really we have a broad base of customers, developers who build timeshare resorts who are part of our RCI exchange network; hotel owners who build hotels that are part of our network as well as many of our affiliate partnerships that we have with our timeshare group will want all of them to have the opportunity to experience the fantastic hospitality of Greensboro and to enjoy the event.

So, that probably won't make it much of a party for our employees because they're going to be doing a lot of work making sure our customers are happy, but I think we will certainly make this a central theme in our marketing efforts through the year culminating.

It won't just be a four day event for us, it will be a full year long buildup towards this event and being a travel company and I will I'll add this to that question because it kind of fits in there, being a travel company that's focused largely on leisure, as well as business travel, our year kind of comes up to a head at the end of August. That's the end of the summer, that's the end of the heavy leisure travel season for families.

So it really fits well into our marketing program to be marketing all the way through the spring as the PGA Tour starts right up until the end of the summer.
So it fits very well for a number of reasons but we're really excited to be part of it.

Q Being a Fairfield owner, I'm just personally interested, what kind of percentage the timeshare market is of the whole picture.

STEPHEN HOLMES: Timeshare represents about 37 percent of our earnings. It is the largest piece of our earnings within Wyndham Worldwide. Fairfield and Trendwest are the two brands that we trade under right now. And I'm happy to hear that you're a Fairfield customer and hopefully enjoying your product.

It's a product that has timeshare, for those much who don't own it or don't know about the product, has extremely high loyalty. Forty percent of the people who buy timeshare buy more because they enjoy the product and they use it.
We have a very, very loyal customer base and we want them to be very excited about the Wyndham Championship as well.

ROB GOODMAN: Anyone else? Steve, thanks very much.
STEPHEN HOLMES: Thank you.

(This interview was taken from the Chrysler Classic of Greensboro website.)