Accor owners welcome independents
09 JUNE 2015 8:34 AM
Franchisees are not overly concerned at AccorHotels’ push to boost direct spend and increase customer choice by opening up its distribution platform to independents.
GLOBAL REPORT—Franchisees of freshly rebranded AccorHotels are welcoming independents to Accor’s brand.com, according to sources.
The company last week announced it is opening up its distribution platform to independent hotels in a bid to offer more choice and balance across geographical markets so as to encourage customers to book direct, rather than via online travel agencies.
“(AccorHotels’ announcement) caught me by surprise, and we’re still in the evaluation process, but on the other hand, there is clear differentiation between Accor-branded and non-branded hotels. The name on the roof indicates a different type of setup,” said Bart P.M. Beerkens, VP, commercial, at Grand City Hotels GmbH. With 11 hotels across Europe—four Mercure and seven Ibis properties—is Germany’s largest AccorHotels’ franchisee.
Aaron Greenman, senior VP of acquisitions and development, Europe, for Interstate Hotels & Resorts, said he isn’t expecting much of an issue. The company has a Novotel and four Ibis properties in its portfolio.
“Owners are never particularly happy, and certainly to the extent that if we have properties in markets in which additional supply comes in, and in our competitive set, we’d need to look into it more, but beyond that, there is not much of an issue,” he said. “In terms of overall approach, I understand how (AccorHotels) is attempting to position themselves against other booking engines.”
In a statement emailed to HNN, AccorHotels said it is not turning itself into an online travel agency.
“We offer an alternative distribution solution to independents, with more transparent conditions. We are aiming to become the most powerful hotel booking platform in terms of traffic, conversion rates and bookings,” the representative said, adding that the company also wanted to become a benchmark hotel distribution platform for Internet users, alongside distributor platforms.
“OTAs are not hoteliers; they purely distribute rooms,” according to the representative, adding that the expansion also will be open to small hotel groups.
Greenman said the success of AccorHotels’ plan would depend on how sensitively and smartly the company rolls it out.
“In the opposite scenario, if an OTA decided to start up a brand, it too would have some friction with its existing ownership base,” Greenman said.
The AccorHotels representative said the company will “offer an ample choice of high-quality options to customers but not ‘hyperchoice,’ which leads to frustration more often than satisfaction.”
One market where AccorHotels seeks more representation is the United States, where it has few hotels.
“The objective is to densify our offer in the U.S., which is a major outbound market for us. We will target hotels in very attractive American destinations for American, European and Asian tourists,” according to the company representative.
While the franchisees contacted by HNN don’t appear to be too upset, sources said other owners might not take the same tone.
Michael Jones, managing director of hospitality and IT consultancy Delta Squared and a former VP of global distribution for Hilton International (now Hilton Worldwide Holdings), said if he were a franchisee hearing this news, “I might be a little peeved.”
But he understands AccorHotels’ goal of adding representation to provide customers “genuine coverage” and to also add independent hotels who would not pay to AccorHotels as much as the “15% to 28% they’re currently paying to (OTAs).”
“It depends on the small print of the contracts (with those independents signing up). If I was a franchisee, my immediate reaction would be: ‘You’re not going to sign up the hotel next to me?’” Jones said.
Another issue to bear, sources said, was that while franchisees might moan, essentially the franchisor can dictate what they can and cannot do.
“The distribution environment is getting more interesting, and we realize we have a minor voice in the whole process. Yes, we can speak up if it is not in our interest, but I understand (AccorHotels’) thinking. OTAs like Booking.com; they will not give up easily their share, so (AccorHotels’ new plan) is worth a try,” Beerkens said.
Beerkens added in his estimation there were between 130 and 140 Accor franchisees in Germany, most having just one of the company’s branded hotels.
“(AccorHotels’) executives must align brand franchisee interests with their own, especially in busy markets. You must remember hotels compete on a geographical basis,” Jones said.