Accor to export all-inclusive to the world with Rixos
FRANCE-BASED global hospitality leader Accor will export a high-end version of the all-inclusive concept, which Turkey is very good at, to the world. Acquiring 70% of Rixos Hotels in 2017, Accor Group plans to grow in all-inclusive hotel management with the know-how from Fettah Tamince of Rixos. The group aims to increase the number of all-inclusive hotels operating under its Fairmont, Rixos, Sofitel, Swissotel, Pullman and Mövenpick brands to 100 in 2022 and 200 in the next five years, according to Yigit Sezgin, Accor Hotels Chief Commercial Officer.
Appointed for the post in November 2018, Sezgin is one of the three Turks that has reached top positions in the hospitality sector. Accor’s decision to work with Sezgin was at a time of strategic change, which started in the group with the new
CEO appointed in 2016. The strategy, which can be summarized as asset-light, includes selling ownership in the hotels they operated (at a rate of nearly 50%) and using the fund generated from the sales in brands. The group entered a tense acquisition period of 5-6 years and increased the number of brands it operated from 22 to 42, including Rixos of Turkey.
Fettah Tamince, who still has a 30% share in Rixos, is an important business partner for the group, says Sezgin, as he will lead a worldwide platform to be established within the group. With his leadership, the all-inclusive concept, which has its best practices here in Turkey, will be developed and applied with other Accor brands in both Turkey and the world. “Learning the all-inclusive concept at the luxury level was one of the reasons behind the Rixos purchase,” said Sezgin.
“We engaged 10 of our brands, including Rixos, to become all-inclusive. We are globally designing the all-inclusive versions of these 10 brands, four of which are lifestyle and five of which are in the premium and luxury line,” he added. They will take the concept to countries with sun and sea options and with resort capabilities such as the Dominican Republic and Mexico in Central America, Vietnam, Thailand and Maldives in Asia, Morocco and Egypt in North Africa and Spain, Italy, Greece and Turkey in the Mediterranean region.
CONSUMER DEMAND FOR ALL̞-INCLUSIVE SERVICE
The focus of the group on the all-inclusive concept is based on the will of the consumer. The group aims to control 80% of the holiday budget, Sezgin noted, adding that people do not want to pay for each sport or leisure activity they try and do not want to leave the hotel to access entertainment services, no matter how rich they are. “They want to be free of looking into their finances, at least in the holiday period.”
Accor’s legacy comes from business and urban hotel management, which still makes the 80% of their business. However, they want to balance and diversify the segments with an investment strategy based on this. Lifestyle and
all-inclusive are the most important two segments for the group in this sense.
During its tense acquisitions process, Accor group added many lifestyle brands like Morgans Original, Delano, SLS, Mondrian, Faena, Mama Shelter and 25 Hours to its portfolio. The group also had its SO brand and total of 12 lifestyle brands gathered under a single roof with the Ennismore merger in October 2021. Accor group holds the majority of the shares (66.67%) in Ennismore, where the founder Sharan Pasricha still owns 33.33% of the company.
LOCAL EXPERIENCE IN LUXURY
Lifestyle is one of the fastest-growing segments of the hospitality industry. Not only hotel operators like Accor, but also investors are focusing on this lifestyle concept in hotel management, Sezgin noted. Generation Z, thanks to its high spending power, is seeking a local experience even in ultra-luxury services, he said. “Our Novotel and Mama Shelter brands are located next to each other in Paris. We had lunch there at Mama Shelter with 1,500 guests, while Novotel, which also has a rooftop and nice lobby options, was pretty empty. There is no difference location-wise but the feeling is different.”
In 2021, Accor opened 15 new hotels and will almost double that figure this year with strong growth in all regions, especially Europe, the Americas and the Middle East. “We are seeing that through increased demand for our lifestyle brands, as we quickly bounce back to pre-pandemic levels, with 15% above the 2019 figures,” said Sezgin.
15 NEW HOTELS IN THE PIPELINE
New investments are also on the agenda in the southern region of Turkey for lifestyle hotel projects. The plan is to launch lifestyle Accor brands in key destinations such as Istanbul, Izmir, Antalya and Bodrum. Negotiations continue for Faena, Delano and Orient Express. “In addition to our 15 newly signed projects, we also have 15 different projects that we are in talks about. We will open our Swissôtel Cesme hotel in the summer of 2022, where we will make you feel the advanced hotel management in every aspect,” Accor CCO said, adding that negotiations for three new hotel projects in Cappadocia are also about to end. The signing of 25 Hours in Galata will also be completed this year, Sezgin said, adding that negotiations continue for the signature of Banyan Tree in Bodrum.
TURKEY’S IMPORTANCE FOR THE GROUP
Turkey will always be an important market for Accor, Sezgin said. “Because the sector began to understand the value of Turkey as the problem of finding qualified employees in the world increased, the trend is leisure and resort hotels in the tourism industry. Turkey stands out with its beaches and destinations such as Mount Nemrut and Cappadocia. So, I believe investment will continue.”
High inflation and rising exchange rates also create opportunities for hotel investments, he added. “We continue to sell our rooms in euros, except for our hotels in Anatolia that only local tourists prefer. We are working on converting those to euro, too. With euros, you get a very serious profit rate in TRY terms.”