Sébastien Bazin, Chief Executive Officer, Accor speaks about his vision and strategies to induce futuristic elements in a traditional hospitality chain
How do you see India as a market and what is your vision for this market?
Accor only exists due to its partners. These partners take the risk of developing a hotel. Today we have 4800 hotels in 100 countries. Accor has never been stronger than today. We are opening one hotel every 30 hours and in the next two years we will be opening a hotel per day. Today we have 4800 hotels which is good. But in India we have only 51 hotels, so it’s a bit more than a per cent. We have in France 1800 hotels, and Germany 500 hotels, in England 350 hotels which are all very small than India. My presence in India is not an accident; we are very serious about this nation. India has one of the oldest respected civilisation with 100s of historic sites, extraordinary culinary and diversity and still getting only two per cent of global travellers. I am looking at how Accor can help India growing from two per cent worldwide destination to 10 per cent. We want to offer more and more experience and brands to the foreign travellers in India. Accor should have around 200 to 300 hotels in India. We will be opening another 24 hotels, but we need to open more.
Today one of the biggest challenges is customer acquisition and retention? Has the concept of loyalty programme evolved over the years?
For the last 50 years, loyalty programmes has been driven majorly by collection of points and getting various perks. Today, people don’t want a cocktail at the bar or a complementary fruit basket at the room. Members are looking at things which is difficult to do on their own. People out there are looking for experiences and access. We recently conducted a survey in around 30 countries and 40,000 loyalty card members. From this survey we found out three major points which people want from the loyalty programme. Firstly, people are looking for access to concerts, entertainment and music. Members want special access to backstage of concerts and meet the singers. Secondly people want culinary experiences. Members are looking for culinary as well as cooking classes and opportunity to meet 3 star Michelin chefs. Finally access to sporting events and chance to meet the players backstage has been the demand. And the sport majorly asked is for Football.
These demands are from 28 years old and also 58 year old members. So we have decided to shift the strategy. So we have now come up with a new programme called, ‘Accor Live Limitless’. We have already have signed three partnership. We have signed with AEG which is the largest concert organiser in the planet. 70 venues in 50 countries and have all major stars performing. We have signed 70,000 tickets every year. We signed another contract with IMG, who is the biggest food festival organiser in 30 countries. We will give privilege experience in these festivals. Then we signed a contract with football team ‘Paris St. Germaine’, which is the fourth largest football team in the planet with 400 million social media followers.
Accor is known for giving out best possible rates on its own website. You also have partnership with all the major OTAs, how do you balance this relationship? Also isn’t OTAs a competition to your own channels?
We as collective hotel players (all the big branded chains) have succeeded and have got the OTAs to accept that the best available rate should be with the hotel company and not on the OTAs. This is because it’s our inventory, we are taking the risk, and we are managing the people. It’s been a boxing game. However it will take a few months for the people to realise this. This is possible only if you are a big chain. Smaller chains still depends on OTAs to sell their inventory.
The OTAs spend millions of dollars in mobile app and website development. We spend one tenth of that as we don’t have that much budgets. We spend on brand and marketing. It’s very difficult for us to cope up with same flexibility, seamless journey that you find on OTAs. If you take three minutes to book on Accor, it will take two minutes on Booking.com or Expedia or other OTAs. This is one of the challenges where we need to look how we can partner better. For you as a guest you want to have speed when you book. We are now very client minded and looking to enhance every experience.
What is the concept of augmented hospitality which you are looking to develop?
We are a hotel company and we do everything to tap the repeat client. Still the average client returning to our hotel is two times a year. So my interaction with you is two times a year, and you interaction with Facebook is 12 times a day. If we want to survive, we have to multiply the number of touch points and increase the interaction with you. But travellers may not come to us 12 times a year as they don’t need to. So now we are buying or investing in many different businesses. We own the largest concierge system called ‘Jean Paul’. People can book anything under Accor ecosystem. When it comes to co-working we own a company called WOJO. We have invested in sbe, which is the largest nightclub, restaurant, entertainment group. So we have invested into 20 different businesses. With Accor Live Limitless we are integrating all these pieces of the puzzle into one ecosystem. So with all these I will increase the interaction from two times a year to maybe two times a week. This is what augmented hospitality is all about.