Accor bet industry consolidation to dribble crisis

São Paulo – the AccorHotels, biggest European hotel chain, is diversifying and strengthening the focus on consolidation in Brazil as a way to react to the advancement of online booking and the strong recession in the country, which has pressed the industry, told Reuters the Chief Executive of the group in South America.
With a focus on new ventures in medium-sized cities, strengthening your own online booking portal with hotels and on your network services not to tourists, the company envisages to expand your participation in the still fragmented hotel market of Brazil, said the President of the AccorHotels South America, Patrick Mendes.
"The hotel world is getting more complex, requiring more diversification and access to inventory," Mendes said in an interview. "Anyone who can''t respond to it and do not have scale will not survive."
Along with partners, Accor plans to invest 2 billion reais in expansion in Latin America in 2017, being 70% that in Brazil, where it plans to open 30 hotels, bringing the number of rooms of 47000 to 52000 in the country.
Despite the recession and the country will not be one of the most popular destinations for tourists internationally, Mendes evaluates that Brazil has about one-sixth of the offer of rooms for thousands of inhabitants than in Europe, which justifies the new ventures.
In addition, he said, the investments are for the long-term and adjustments can be made over time. That''s what has already happened in some older developments where Accor has reduced the supply of rooms in some cities in the country most affected by the crisis, said the Executive without citing which.
Most of the new units will be inaugurated in medium-sized cities with population over 600,000 people, many with suboferta rooms, said Mendes. These will add the acquisitions made recently, including the announced in March, when paid 200 million dollars to take over the management of BHG hotels, 26 of GP Investments.
This offensive is part of Accor''s efforts, with increased slice of cake, answer the retraction in the hotel business in the country in the last three years, even with global visibility events such as the Olympics and the World Cup.
In 2016, Brazil fell from the fourth to the fifth position among the most important markets of the company, accounting for 8% of the Group''s sales.
According to Mendes, the trend in the coming years is that the country''s hotel market has greater concentration. He cited the case of the North American market, where about 85% of the rooms are in the hands of the big hotel chains, while in Europe this concentration is 40%.
In Brazil, says, only 25% of the rooms are large groups, with half of it in the hands of local networks. Of the hotels with flags of Accor, as Ibis, Sofitel and Mercure, about a third of the buildings are themselves half rented and the remainder is trademark licensing.
"It is reasonable to imagine that, with the increased use of the Internet and greater participation of online distributors, this scenario will change," said the Executive.
In fact, Accor has enhanced your digital arm with a flurry of small businesses to combat the growing competition from online travel agencies like Expedia and Booking.com, they charge 20 to 40% Commission on bookings made by users.
In this scenario, Accor will list also in Brazil in your booking, Fastbooking hotel deals at the same time the independent units of its 20 hosting flags in the country.
"It''s a curator for third parties over which we can guarantee to our customers that are quality hotels, with high marks on TripAdvisor," said Mendes.
On another front, to face newer business models in the sector, Accor bought a year ago the company stays in rental onefinestay luxury homes, a species of Airbnb.
Determined by a foot in all market trends, Accor on other end opened in March in southern France Jo Jo, your flag & hostels, accommodation low cost focused mainly on young people.
The move follows the trend of the world''s largest operators of hotels, including Marriott, Hilton and InterContinental, who are developing business areas focused on the so-called millennials, born after 1980 that these networks assess what will be the largest group of customers around 2020.
Finally, said Mendes, the group is moving to expand its revenue by offering services that today are exclusive to guests, such as laundry and delivery.
"We''re going to be a point of reference for the neighborhoods of our hotels," he said.