News for the Hospitality Executive
Accor Launches New Operational Strategy with
September 13, 2011 - Accor today has announced a number of major changes concerning its brands, its operational strategy and its financial objectives. The Group is now “100% hotelier” and backed by its unique and universal model as an owner, operator and franchisor from economy to luxury in all regions.
All of these developments will be presented today in detail at the Accor Investor Day, to be held in Paris beginning at 8:00 a.m. The event is webcast live on www.accor.com/finance
“Our business model is now clearly set," said Denis Hennequin, Accor’s Chairman and Chief Executive Officer. “The next step is to revitalize our brand portfolio and share our unique expertise with our franchisees. In a spirit of conquest, we are strengthening our development plan and announcing our ambition of becoming the global reference in hotel industry.”
The strategy is based on four pillars:
A new strategy for the economy brands
The Group has broadened the role of the Accor corporate brand. With the Accorhotels.com online brand and A|Club, now renamed Le Club Accorhotels, the Group is introducing a common visual identity with Accor playing the role of a commercial brand. With a new baseline – Open New Frontiers in Hospitality – the Accor brand is committed to becoming the hotel industry’s most competitive, most attractive affinity brand for customers, partners and employees.
The economy hotel offering is now based on two foundations: A new brand architecture and an ambitious plan to revitalize products and services. In 2012, the Group will organize its brands in a more aligned, understandable, attractive manner by capitalizing on ibis, a powerful brand that enjoys high awareness around the world. Consequently, all seasons will become ibis Styles and Etap Hotel will become ibis Budget. The new ibis “family” represented 1,570 hotels at end-June 2011.
ibis becomes a Mega Brand with three brands:
A vast communication campaign will accompany this rebranding in 2012. Its objective will be to capitalize on the image of the ibis Mega Brand by highlighting the shared DNA through three structuring concepts: modernity, simplicity and well-being, while clearly differentiating the distinct offers of each of the three economy brands.
ibis, ibis styles and ibis budget intend to become the brands that offer the highest level of comfort and well-being in the economy hotel segment.
A plan to modernize the hotels and improve bedding comfort will be implemented. We will proceed to a reconfiguration of common areas, food & beverage offer and consumer technologies so that the hotels correspond to new trends and meet the expectations of tomorrow’s customers.
With its 1,500 economy hotels on 4 continents, excluding Motel 6 in the US, Accor absolutely must consolidate its leadership position in this segment which is essential for its profits and its worldwide growth. This new, ambitious brand project will:
Accor is now a pure-player hotel group’s brand. Denis Hennequin believes the time was right “to redefine its objective and missions”.
The new tagline “Open New Frontiers in Hospitality” reflects the group’s aspiration to regenerate the spirit of innovation that is inscribed in the company’s genes and imagine new forms of hospitality, in particular digital ones.
The Accor brand will now play a larger role, particularly with the general public.
On the one hand, it will convey the Group’s commitments to wider audience, particularly in human resources, sustainable development and multiculturalism, thus generating more value for all hotel brands.
On the other hand, in the Internet battle field, which is crucial to the future of the hotel business, as a transverse commercial brand, it will be associated with the most strategic direct distribution channel, namely Accorhotels.com, and with the loyalty program A|Club renamed Le Club Accorhotels.
Lastly, to strengthen the bond of trust and the credibility of its brands, Accor will also become an endorsement brand with a new endorsement system, the “by Accor” signature which will be used in all the brands’ communications.
Repositioned in this way, with a more distinctive and clearer identity system, the Accor brand aims to become the hotel industry’s most competitive and attractive relationship brand for partners, employees and customers alike.
A unique distribution network core to operational strategy
The status of a hotel operator covering all segments from economy to luxury provides Accor with a considerable advantage that the Group plans to consolidate.
This advantage is apparent in distribution, an area in which Accor is on the leading edge of innovation worldwide thanks to the only fully Web-based central booking system, total connectivity with online distributors and a very strong presence in mobile applications. Today, nearly 60% of room revenue for all Group hotels is generated by these central distribution channels. The loyalty program, renamed Le Club Accorhotels, now has more than 7 million members, of whom 6 million outside France.
Accor’s operational excellence will increasingly be made available to franchised and managed hotel partners. The Group’s status as the world’s leading hotel operator represents a key asset for its franchising operations. It enables Accor to forge true partnering relationships with franchisees by offering them unique services and support tools. These assets are spearheading an ambitious strategy to develop the franchised hotel network, especially in Europe.
value-creating asset management strategy
In 2005, Accor embarked on a far-reaching asset management program aimed at reducing the capital intensity of the hotel portfolio as well as cash flow volatility. The program unlocks the value of its property assets and structurally improves margins. The asset management strategy represents an additional lever for development.
Half of the program to dispose of 450 hotels in the 2010-2013 period has already been completed. Early in the year, Accor also announced it was accelerating its initial program to reduce adjusted net debt by €1.2 billion in 2011-2012. The success of recent sale-and-management-back transactions involving the Pullman Paris Bercy and the Sofitel Arc de Triomphe illustrates the progress made in implementing the program.
Accor is today
announcing a new plan for the 2013-2015 period. It will involve 175
hotels and reduce
adjusted net debt by €1.0 billion.
An ambitious development strategy
The development strategy is built on two key axes: Strengthening the Group’s leadership in Europe and developing operations quickly in emerging markets.
Europe remains a high potential area of growth for Accor. The Group will leverage its leadership to pursue an assertive development strategy, especially in economy hotels, a segment in which the penetration rate of hotel chains is still low in many countries. Repositioning the hotel brands around ibis will provide additional benefits.
In emerging markets, Accor is committed to strengthening its presence, particularly in high potential countries like Brazil, India and China. By 2015, the Group targets to quadruple the size of its network in China.
To speed its
development, the Group will leverage:
financial strategy designed to optimize the business model
All of these factors are intended to optimize the Accor business model, which aims to deliver a sustainable improvement in cash flow generation by increasing margins and return on capital employed.
Performance system already shows that the contribution margin generated
management and franchise
operations exceeds 50% and that sales & marketing operations are
breakeven, in line with
Accor is also expanding the analysis of its business model. The Group will now report EBIT margins separately for hotels that are owned or leased under fixed or variable leases and has set the following medium-term margin objectives:
leveraging its unique assets and pursuing an ambitious development
Accor is entering into a new era of
growth and value creation for its shareholders.
world's leading hotel operator and market leader in Europe, is present
in 90 countries with 4,200 hotels
and more than 500,000 rooms. Accor's broad portfolio of hotel brands -
MGallery, Novotel, Suite Novotel, Mercure, Adagio, IBIS, all
Styles, Etap Hotel/ibis
Budget, Formule 1, hotelF1 and Motel 6 - provide an extensive offer
luxury to budget.
With 145,000 employees worldwide, the Group offers its clients and partners nearly 45 years of know-how and expertise.
MEDIA RELATIONS INVESTOR RELATIONS CONTACTS
Senior Vice President Communications
& External Relations
Phone : +33 1 45 38 87 52
Phone: +33 1 45 38 87 08
INVESTOR RELATIONS CONTACTS
Senior Vice President Financial
Communications & Investor Relations
Phone : +33 1 45 38 86 25
Phone:+33 1 45 38 87 06
Accor Hotels in Australia, The Mercure Sydney and The Menzies,
Introduce Optimum Service Standards for Indian Guests / August 2011
Residence Hue Hotel and Spa in Vietnam Joins Accor's MGallery
Collection of Unique Hotels / August 2011
Ramps up Development in Indonesia with Planned Additions of 21 New
Hotels / June 2011
Built, the all seasons Bangkok Victory Monument, Accor's Economy Brand,
Opens / June 2011
by Tainui Group Holdings in Partnership with Operators Auckland Airport
and Accor, the $65 million Novatel Aukland Airport Opens / May 2011
to Welcome 345-room Cairns Colonial Club of North Queensland,
Australia; Property to be Marketed Under All Seasons Brand / April
An Named as the Executive Chef of La Residence Hotel and Spa in Hue,
Vietnam / April 2011
McGallery Adds Two Resorts in Thailand; 69-room Veranda High Resort
Chiang Mai and 118-room Veranda Resort & Spa Hau Hin-Cha Am /
Appoints its First Fiji-born Hotel Manager, Jack Work, as Hotel Manager
of the Mercure Nadi in Fiji / March 2011
Terminates Gilles Pélisson as CEO, Denis Hennequin to Assume
Position January 2011 / November 2010
Plans to Double the Number of Hotels in Latin America to 300 Following
Separation of the Hospitality and Service Units / July 2010
Huong Liberty Building a 300-room Accor Branded Pullman Hotel in Ho Chi
Minh City / June 2010
|The Que Huong – Liberty Group and Accor Building a 350 room Novotel Hotel on the Site of the Metropole Hotel in Ho Chi Minh City, Vietnam / November 2009|
Rebranding the Former Grand Mercure La Veranda Resort and Spa to La
Veranda Resort and Spa Phu Quoc, a Member of MGallery Collection of
Hotels / August 2009
|Accor Asia Pacific Expansion Continues with Five New Pullman Hotels in China, Thailand and Vietnam / August 2009|
|One of Australia’s Most Iconic Properties, Cradle Mountain Lodge, Joins Accor’s MGallery Collection / July 2009|