AccorHotels look back at an exceptional 2016 and plot the course for a dazzling future
After last year’s integration of ‘FRHI” brands into the AccorHotels group, at this year’s ITB Berlin, we caught up with Chris Cahill, CEO of AccorHotels Luxe group, and Markus Keller, Senior Vice President, Global Sales. We asked Mr Cahill what he sees as being the key advantages of the new “bigger and better” organisation.
Chris Cahill: Two or three things. It gives AccorHotels heavier weight in the upperupscale luxury tier, where in the “luxury” category, we are the second largest after “Marwood”, in terms of the number of luxury properties we have. The second thing is that we have really strong dominance in Asia-Pacific, we are the largest operator of hotels in Europe, generally we are the largest operator of hotels in South America, we are one or two in MEA. So being able to build these brands on top of the brands AccorHotels already has in all those areas gives us tremendous growth opportunities. We are already seeing it. We signed more letters of intent for new hotel contracts for the “former FRHI” brands in the six months after the transaction closed in July than in the best year that FRHI ever had. I think that is a reflection of our scale and the distribution and the fact we now have those brands available for partners of AccorHotels where there were good partnerships but perhaps we didn’t have the right brands for some of their development, we now do have.
How are you helping hoteliers in your group get “out there” at ITB Berlin, and how important is this?
Markus Keller: ITB Berlin is one of the most important events for us in the international calendar. We have a strong contingent. On our global stand, we will have seventy people representing 22 countries. But there is a number of individual hotels that also participate in their destination booths. And for any hotel that is looking to position itself in the traditional leisure market, with tour operators and wholesalers, but also in the connected travel market, through the OTAs as well as the connected tour operators, this show remains critical. We have seen the show evolve over the past few years, with a lot more of the connected distributors making their presence know, some of the technology players that are servicing the hotel business taking up bigger and bigger stakes in order to be more visible for those traditional TOs who were looking to move into the connectivity environment. GTA were early in that piece, but they have since been followed by many others.
WE SIGNED MORE LETTERS OF INTENT FOR NEW HOTEL CONTRACTS FOR THE “FORMER FRHI” BRANDS IN THE SIX MONTHS AFTER THE TRANSACTION CLOSED IN JULY THAN IN THE BEST YEAR THAT FRHI EVER HAD
You’ve just announced a partnership with Rixos… Please tell us more.
CC: We just had a press briefing in Berlin to announce that on the closing, we will have a 50% stake in the JV company. Through this joint venture, AccorHotels will integrate in its network 15 iconic hotels that are ideally located in premium resort markets in Turkey, UAE, Egypt, Russia and Europe and which benefit from strong room rate performance. As part of this transaction, Rixos plans to reflag five city-centre hotels to AccorHotels brands which will also be managed by AccorHotels.
What are AccorHotels’ key USPs in terms of distribution?
MK: Firstly, in terms of brand depth, there wouldn’t be an international competitor of the calibre of AccorHotels that has everything from Luxury through to Budget. Secondly, if we put aside North America, AccorHotels is the largest player in every major market in the world… certainly across Europe, the Middle East, most countries in Asia, the Pacific Region, South America. And thanks, in part, to the acquisition of FRHI last year, we have become a reasonably significant player in North America – certainly in the luxury space. So size matters, and depth of brand coverage matters. Thirdly, like a number of our American competitors, we were early into the connectivity business, both with the OTAs but also with the connected tour operators. We do consider it one of our strategic strengths – our capacity to connect with third parties and to be able to extend our distribution – not only with the large ones, but also with a number of the niche distributors who might be specific to certain segments, or specific to types of hotels, who can help us to extend our reach