Loyalty programmes can help hotels take back control of bookings from dominating online travel agencies (OTAs) such as Booking.com and Expedia, according to the CEO of Europe’s largest hotel operator Accor.
Speaking to Arabian Business, Bazin said the hotelier’s repurposed loyalty programme Accor Limitless will encourage customers to book directly through hotels as opposed to booking through a third party.
Accor Limitless allows members to access everything from chef masterclasses to concert tickets and more, as it signed a deal with French football club PSG to become its principal partner and shirt sponsor from the 2019/2020 season.
“[Let’s say] you come to me - and you have never heard of Accor before - and you come to Novotel in Marseilles. I’m very happy to host you, I’ll do a very good job - hopefully - in giving you an Accor loyalty card in the first time you pop into my hotel to make sure you understand what else we have on the planet. So, if you were to come back to Accor, this will try to incline you to go on direct bookings on Accor as opposed to going on Expedia again. It’s called retention; stickiness,” he said.
Bazin said that the eight largest hotel companies are “big enough for you to remember who we are,” but added that “OTAs are not the enemy here.”
“They really aren’t. They are super powerful platforms and they do a hell of a job in the intermediary between clients and hotel companies… And of course, there is a cost for this,” he said.
Bigger hotel players like Accor pay 10 percent commission, according to Bazin, while smaller hoteliers pay around twice the percentage.
While he is willing to pay for first time customers, he not willing to do so for second time clients, he said.
“So for a first time customer, I'll be glad to pay, but for a second time customer? Nope.”
Bazin said short-rental platforms like Airbnb are “less impactful” than OTAs as they focus on secondary and tertiary cities due to lack of legislation in capital cities, where the larger hoteliers are focused.
“I have a lot of respect for them… 90 percent of Airbnb guests are also users of hotels. It's very much complementary,” he added.
Accor saw revenues rise 16.9 percent to €3,610 million in 2018 compared to the year before. Thanks to acquisitions of Mövenpick Hotels & Resorts and Mantra Group, it ended the year with 703,806 rooms in 4,780 hotels, and has another 198,000 rooms in 1,118 hotels set to be built around the globe.
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