• Accor launches third pillar

AccorHotels has launched AccorLocal, an application allowing residents who live near an Accor property to access “the services of local artisans and companies”.

The strategy is the group’s third vertical in its transformative strategy which is set to be consummated with the closing of its Booster operation, expected by the first quarter of next year.

AccorLocal allows hotels to offer the services of local businesses and services, while also allowing local residents to access the hotel’s amenities.

Other services are provided through larger partnerships and include: bouquets delivered to the hotel’s reception with AccorLocal’s special bouquets in collaboration with Pampa, Bergamotte and others; yoga, pilates and relaxation classes provided by Oly Be in a room let by the hotel; quality bread delivered by Poilâne, Nespresso capsules pick-up and deposit points accessible 24/7, a payby-the-hour car rental service with AccorLocal offered by Hertz 24/7.

The group said that the AccorLocal app had about 3,000 active users and now offers hundreds of services in more than 250 hotels in France. AccorLocal will be rolled out in 2018 and 2019 in major cities and capitals around the world.

Scott Gordon, AccorLocal CEO, told us: “It’s totally free and totally optional for everyone participating, it’s an open platform. We have some partnerships and whenever a hotel is interested they can pick a handful to try and then add their own services – pool, F&B, whatever they want to propose.

“There is no cost to the merchants, we ask that there is price parity between they charge locally and what they charge us. The customer pays direct through the app. With the hotel services we take 10% for the platform and 90% goes to the hotel.”

The application is not yet linked to the group’s 32 million-member loyalty programme, but Gordon added: “It’s going to be a big part, it’s going to be a game changer – members will be able to earn and burn on their daily life habits. Today the problem we have is that we only see our customers a couple of times a year. Our ambition is to be recognised as your daily life companion, not just your travel companion.”

The application has been on trial since March, with Gordon telling us that yoga classes – which helped fill under-utilised space – laundry services and breakfast pick-up were particularly popular. He added: “A lot of very local things happened really well. We have a hotel in central Paris which is near to a motorbike park, we offered a helmet drop-off and a breakfast pick up. You can then get your helmet at the end of the day.

“We’ve been focusing for the past 50 years on the travellers of the world and had forgotten about the local community, which is five or six times the size. After all, who else is open 24/7 other than the police, hospitals and hotels?”

Launching the project earlier in the year, Sébastien Bazin, chairman & CEO, AccorHotels, said: “For the past 50 years, millions of customers around the world have trusted AccorHotels’ hospitality expertise. When they go through the door of one of our hotels, they can be certain of finding, at any time of day, a customised service offered by more than 250,000 people who are passionate about our unique savoir-faire in the field of hospitality and service. We have now chosen to make this unparalleled wealth available to benefit community life by developing an unprecedented model, creating social connections and value for small businesses, local communities and staff members at our hotels.”

AccorLocal was first revealed in March, with Bazin saying: “We need to diversify outside of hotels. We will continue to work in hotels for the next 50 years as we have over the last 50 years, but what about when our colleagues want something more? What about some people want more than just a hotel room?”

The three verticals are: the core hotel business, the travel business outside traditional hotels and “community services”.

The third vertical was aided by AccorHotels acquiring 79% of concierge product John Paul for USD120m a year ago, which, it said at the time, would allow it to provide an even broader choice of services to treat all travellers to the best experience “before, during and after their stays”.

Commenting on the third, community, vertical, Bazin said that it had “nothing to do with travel but it’s plugged into community services. But the three have something in common and it’s very important. It’s customer relationship. The database will be common to the three.The loyalty programme will be common to all three. Technology will be common because the three will mutually enrich each other.

“If we do this right vertical two and vertical three will represent 30% of mid-term results in five years’ time.”

“We have customer relationship that is perhaps three, four, five times a year when we see you in our hotels. Facebook has a relationship with its customers seven times a day.

“I have absolutely to ensure that this group leverages interaction with its customer more than three, five times. I’m going to ask you to travel once a month, so I have to enter your daily life. What can I do for you when you’re not traveling, what can I do for you when you’re not traveling with me even if you are going to Marriott or Airbnb and if you’re visiting your granny?”

Illustrating the third vertical, Bazin took as an example an Accor customer with a frail, aged father who he needed to put on a train, but was unable to do so himself. Why not leave the parent at the local Accor hotel, where he he could have a coffee, read the paper, watch the TV and then be taken to the station, where, once safely deposited on the train, the relatives could be informed by text?

The launch comes as the finalisation of Accor’s Booster project was eagerly awaited. In May the group confirmed that non-binding offers had been received from a “select group of well known investors”, with buyers conducting due diligence.

Morgan Stanley has modelled EUR5bn of proceeds from the sale of 70% of Accor’s owned property business with just EUR2bn handed back to shareholders via a share buy-back. Details on how much of the division Accor planned to retain remain scant.

HA Perspective [by Katherine Doggrell]: Bazin has made much this year about putting hotels back into local communities, after purporting to have been horrified by his GMs not knowing the names of the local dry cleaners. And with Booster taking longer than advertised, it’s good to see the strategy still moving forward, a delay which might raise concern with any company other than Accor, most of whose movements need to be slowed down by wildlife photographers so the rest of us can see what they’re up to.

But will Accor’s move to act local embed them in the community (and pay off into the bargain)? Imran Hussain, director of collaborative marketing agency THC/Endeavour, told us: “A hotel wanting to engage with its neighbourhood should be thinking about the value they can add to their neighbour and the lives of the people within it.

“This value, when done right extends far beyond coffees, wireless and beds for the night – it should be something tangible to the communities within that place. Hotels have unrivalled access to all sorts of influential connections and industries – they can effortlessly create opportunities for locals that other businesses can’t. For the locals this is the inherent value that is intrinsic to the hotel industry – places of connectivity and community.

“In terms of why this is relevant – all you have to do is think about who refers your hotel when they have friends and loved ones coming to visit them in big cities, those folks who live in central locations, where flats are limited in space. Or perhaps more importantly, how real estate valuations and gains are calculated between comparables, gross revenues and public perception. Create a scene or public value for the locals and they’ll repay you with loyalty that you don’t need to scheme for – but more than this it should be a case of neighbourhood integrity.

“Hotels are microcosms of cities or neighbourhoods – and the relationship between the two should always be symbiotic and to achieve that starts with an understanding of fellowship – accepting the hotel as a vehicle for social change.”

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