Design hotels for locals and travellers will come, says Accor CEO

Accor chairman and chief executive Sébastien Bazin has said he is turning the historic approach to hospitality “upside-down” by prioritising local communities over travellers.

“Make sure you cater for them, give them a reason to come to that brand, make sure they use the bar, the restaurant, the public spaces to work remotely… you will pick up the [traveller] because it is buzzing,” said Bazin, speaking at the International Hospitality Investment Forum (IHIF) taking place at the InterContinental Berlin earlier today (16 May).

“You have to change upside down your entire thinking of hospitality from 40 years ago when we only cared about trying to cater for the traveller… that is wrong,” he told Questex vice president, market leader - operational real estate Joe Stather. He added that if most of a hotel’s income is coming from local guests, it is “the best buffer” against market shocks like the Covid-19 pandemic.

At the group’s AGM tomorrow (17 May), shareholders will vote on the future of Bazin’s leadership of the company. Bazin was confident of the vote going in his favour, saying that his “journey’s not over in terms of what I’d love to do with the company”, including the continued delivery of a substantial restructure that effectively split the organisation in two last year. Deputy CEO and chief financial officer Jean-Jacques Morin now leads the group’s economy, midscale and premium brands, with Bazin heading up the luxury and lifestyle segment.

Bazin said that the company’s restructure was about diversifying Accor to focus on a “different pace of growth in different geographies” rather than a crisis over its midscale brands.

Despite the struggles mid-market hotels are currently facing compared to the resilience of the budget and luxury ends of the market, Bazin said mid-market brands remained solid, resilient and robust and “respond to a need” even if the growth of the segment in mature markets may be slowing.

As for brand standards, the chief executive also goes against the grain by saying that he enjoys when hotels of the same brand are different depending on their locality. “Let’s give the owners the freedom and liberty to do something different,” he said, although stressed the need for a similar price point across a brand.

“I’m draconian on the price point, not with the content within a site,” he explained.

Following a positive start of the year, with first-quarter 2023 revenue of €1,139 million, up 54% like-for-like on the same period in 2022, Accor recently revised its 2023 guidance upwards, with double-digit revpar growth versus 2022.

The France-headquartered group has a global hotel portfolio of 800,321 rooms and a pipeline of around 214,000 rooms across brands including Raffles, Fairmont, Ibis, Mercure and Novotel.

Speaking to Hospitality Investor earlier this year, Morin predicted 2023 was going to be “a great year” for Accor in which the new divisions would be a “powerful factor” in allowing the business to offer greater value to owners and customers.