Benjamin Coren spoke to three industry leaders to find out their plans and seek their views on the issues affecting the hotel sector
Q. With consolidation taking place among hotel groups, what are your plans in this area and what are your views on consolidation? Belinda Pote, Marriott Consolidation in the hotel industry is a trend that is likely to continue over the coming years. With organic growth becoming increasingly challenging, especially in mature markets, the fragmented nature of the hotel industry lends itself to growth by brand acquisition.
Marriott International acquired Starwood Hotels & Resorts in September 2016, creating a company with 30 brands and more than 6,500 hotels. In addition to providing further choice for guests, the combined company has gained scale, providing enhanced value and economic advantages for owners, more efficient deploy-ment of centralised service funds, plus greater ability to invest in systems that drive profitability.
dimitris Manikis, Wyndham If there is a good deal out there, there is no reason why we wouldn’t be looking. In the last 18 to 24 months we concluded the purchase of a great brand called La Quinta, which has 900 hotels. The new brand will be coming in 2019. We are in the game and we’re pleased with this major acquisition. We’ve got a board that has proven it is open to new opportunities when they come along. We are not the only industry where consolidation plays a big role, look at airlines and travel agencies – it is a sign of the times. Chris roe, accor It’s been clear that Sebastien Bazin (CEO) has been on the investment trail. We’re out there looking and we’ve not been shy on acquiring and optimising business. The acquisition of Raffles in 2016 launched us as a player. That’s continued with Rixos.
We have to look at what’s right for our business and what’s right for our guests. The acquisition of Raffles has confirmed us as specialists in luxury. I think it enables us to keep with the corporate market. If there is cost-cutting we can go up and down the food chain of brands.
Q. What about the proliferation of brands? What are your plans for existing or new brands? BP The diversity of our brand portfolio is a way to tailor the hotel experience to our guests. We are continually investing in our brands to ensure that they stay top of mind in today’s competitive marketplace. For example, last month we announced our new vision for Sheraton Hotels & Resorts, reverting to the brand’s roots as the gathering place for locals and guests. We are also launching our brands in new markets. In May, we debuted Delta Hotels in Europe with the opening of Delta Hotels by Marriott Frankfurt Offenbach. The Delta Hotels portfolio now encompasses more than 50 properties, with a pipeline of over 30 signed projects in North America, Europe, and Asia. dm We’ve got 20 hotel brands and all 20 of them fit a purpose and as a company we have a duty to give every brand substance and provide support.
From a new brands perspective I would use the example of Trademark. It’s a brand we developed a year ago and there are 50 Trademark hotels already. It’s a soft brand, so it allows individuality and allows certain DNA to take advantage of what we do. Consumers dictate what we need but I think we perfectly fit in the segment.
With over 9,100 hotels it would be difficult to say we’re missing out anywhere. We’ve got the Dolce brand for the meetings and events business and we purchased it because it reflected what our MICE and corporate clients want.
Cr Our focus right now is on integration. The next brand for us to integrate is Movenpick. It’s regionally very strong in the Middle East and that’s the next one to go through – it gives us strength in multiple Middle Eastern countries.
In the UK we like to challenge and get under the skin of what the customer is looking for, leisure and business traveller alike. For example with Ibis brands, a frustration for customers was check-in and check-out so in new hotels we are not putting in receptions, but instead having mobile check-ins with staff who have mobile devices and customers are checked-in by someone who has a mobile device. Check-in is now faster and there is no check-out, with the invoice simply emailed to customers. Q. Are there any particular plans for expansion this year and beyond? What can you share? Bp In 2017 we announced our 2020 vision which included growing our portfolio by an additional 90,000 signed rooms by the end of 2020. Following the Starwood acquisition, we revaluated and amended these goals and our focus now here in Europe is to be ‘number one where it counts’. We are already the largest operator of luxury and upper upscale hotels in Europe, and we see great potential to expand our mid-market and lifestyle brands such as Aloft, Courtyard by Marriott and Moxy. Moxy is particularly interesting. We launched the first Moxy Hotel in Europe in 2014 and we now have 19 open across the continent. And more than 50 Moxy hotels across 40 destinations are expected to open between now and 2020 showing the phenomenal demand for this affordable lifestyle brand.
DM We choose our locations based on a lot of facts such as advice from developers and owners. We speak to them to find out which brand would best suit them. It serves the purpose of our owners as it has a focus – for example, brands focusing on the MICE market. We would love for all our brands to be everywhere. If you take on one brand after the other in a city you can easily have any number of our brands. We buy brands for our customers to experience them and for our owners to make money out of them.
Cr In May we acquired Atton in Chile who have 11 hotels and in April we acquired a 50% stake in the South African Mantis Group which has boutique hotels and eco lodges.
We’ve got the growing Adagio brand and that services business travellers who want an extended stay option. I think the challenge it faces are that a lot of corporates stay away from private extended stay options but Adagio has maid services and meets regulations that corporates insist on. With project and consulting work, you see corporates moving towards it. At the same time, Adagio is not a luxury product and I think there is a gap in the market there that One Fine Stay can fill. Q. How much of a threat is Airbnb and the sharing economy, and how are you addressing it? Bp We welcome healthy competition and embrace the challenges it brings. It has certainly been a disrupter in our industry and has prompted hotel companies to think differently about guest needs and behaviour.
In April this year we launched Tribute Portfolio Homes – a six-month home-sharing pilot in partnership with Hostmaker, a London-based home rental management company. We selected 200 exceptional homes across London and put in place a set of enhanced requirements consistent with our company’s overall approach to guest accommodations. This pilot has been an important step in understanding the intersection of hospitality and home sharing, and how this type of accommodation can complement our existing portfolio.
DM The sharing economy gives people the chance to travel. Airbnb has their business model and we’ve got ours. I think there is room for everybody. At Wyndham we have everything the traveller needs in the place they need it and at the time they need it.
Cr Airbnb and Homeaway service a lot of the small market but the big corporates have very strict policies in place for what their travellers can stay in. Travellers have to comply with these policies and I think we’re better placed to service that going forward.