Accor brings independents into distribution
03 JUNE 2015 9:29 AM
Accor is pushing the boat out in the distribution wars with a far-reaching raft of measures that include a name change, staff additions and the opening of its new one-stop-shop distribution channel to independent hotels.
PARIS—Once again, it’s all about change at Accor.
The French hotel giant is continuing its fight in the online wars on several new fronts by changings its name to AccorHotels, adding staff to its digital platform silo and opening its distribution channels to independent hotels.
Vivek Badrinath, Accor’s deputy CEO, said during a conference webcast Wednesday that Accor has 3,800 hotels in its distribution platform but that number will increase to 10,000. The difference between the two numbers? Independents.
Pulling in global independent properties does not constitute a soft brand, officials said, and AccorHotels is not looking to transform itself into a model that resembles an online travel agency.
Get ready for the new world of—as Accor’s chairman and CEO Sébastien Bazin referred to it during a translated webcasted conference call Wednesday—BATA: Booking.com, AccorHotels.com, TripAdvisor and Airbnb. (All of Accor’s distribution platforms are to be funnelled into one: AccorHotels.com.)
Accor’s offering will be “spread out in a more balanced manner, to increase the midscale and upscale offer and our geographical coverage,” Badrinath said.
Bazin said hoteliers account for 70% of tourism accommodation revenue, totaling €530 billion ($584 billion) and that independent hoteliers dominate the segment in terms of keys, with 33% of the market in the United States, but 67% in Latin America and 62% in Europe.
Jean Luc Chretien, executive VP of distribution, sales and loyalty, said hoteliers are eager for alternative distribution platforms.
“We are not at war with OTAs; our challenge is to control the value chain and make sure nothing is taken away from our distribution,” Chretien said.
Bazin said the new initiative is not an OTA, and the launch will establish a major difference between Accor and the world of competitors Marriott International, Hilton Worldwide Holdings and others.
Accor has not been quiet on the tech and distribution front of late. Last autumn, it outlined its plans going forward, with Wednesday’s announcement being the latest step. The company had purchased mobile developer Wipolo, while in April it purchased digital services provider Fastbooking.
One analyst asked about the commission structure for the independent hotel signees.
“It will be lower than on other (competitor) channels, competitive with OTAs and adapted to each market due to dynamics, but it will be a highly transparent system. Our fees will be constant and homogenous,” Badrinath said, who added independent hoteliers have been part of the discussions leading to the announcement.
Standing beneath the slogan “Growing our playing field,” Bazin told analysts, “We want to establish the very best digital hotel application, made, designed, by hoteliers, for the benefit of our hoteliers and our clients.”
He also added one new fillip to the distribution discussion.
There will be “sharing of data with independent hoteliers, which does not exist in their relations with OTAs,” Bazin said.
As the conversation turned to consolidation, Bazin was hesitant to speak on the subject.
“Everyone thinks there is going to be consolidation in the hotel world … but speed and size are going to make the difference. … (for us to buy out one of the huge chains) it would require several billion dollars, in addition to (the problems of) culture, risk and technology. We also can expect new players who simply did not exist 10 years ago. They will have value in the next 10 years that took us 50 years to build,” Bazin said.
He became more assertive when it came to Accor’s strengths.
“We have all this growth potential right under our fingers. We do not need to necessarily make any further acquisitions,” Bazin said.
“The biggest failure in today’s world is to ask yourself the same question 30 times and do nothing. It is all about speed. If you have the resources and talent, go for it,” he said.