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[Travel News]: Accor’s Mendes bets on diversification, adaptability

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The following is the [Travel News]: Accor’s Mendes bets on diversification, adaptability from [hotelsmag] recommended by TheTourAttraction.com:

Luxury is all about diversification for different personality types and experiences, so a wider range of brands lets Accor achieve greater market share.

“Accor is going bold on lifestyle,” said Patrick Mendes, the Paris-based company’s group chief commercial officer in charge of sales, marketing, distribution and loyalty. The group’s recent acquisition spree led to co-ownership with Ennismore of the Hoxton brand and Scotland’s Gleneagles resort, and an increase to 100% ownership of Sbe’s hotels. Including the previously acquired Mama Shelter and 25hours, Accor launched a dedicated lifestyle division, retaining the Ennismore name and uniting all 13 brands under one group managed 50/50 by co-CEOs Sharan Pasricha, founder of the original Ennismore collection, and Gaurav Bhushan, previously Accor’s chief development officer.

“Having one CEO focused on branding, marketing and distribution, and the other on development, finance and operations helps Accor reach its goal of becoming the number one player in lifestyle hospitality,” Mendes said. Before the merger, Ennismore was planning to increase its portfolio to 20 to 25 hotels in the next two or three years, but now it plans to reach more than 250 lifestyle properties in that period.

This structure sits well with Accor’s wider realignment, which for the first time situates marketing, distribution and loyalty divisions under one umbrella. Fortuitously, Mendes has the right skills to make this structure successful. He joined Accor in 2005 as svp global sales and distribution, moved to São Paulo, Brazil, in 2011 to become COO, luxury and midscale brands Latin America, before transitioning to CEO, Latin America in 2015. Last October, he returned to Paris for his current role with eight geographic regions under his purview.

“I’m a mix of an operations and corporate guy,” Mendes said. “It’s rare to have someone who spent half his career in operations leading hotels, developing hotel owners, and working with managing directors and general managers to manage properties, and yet [also] has corporate-level experience defining strategy on loyalty, marketing, branding and sales incentives. I like the balance because you decide things differently when you see both sides of the coin.”

That perspective has shaped Accor’s strategy to acquire luxury brands with consumer awareness and extend them everywhere. The January 2021 joint venture with Argentinian brand Faena sparked plans to expand into Dubai, Singapore and Paris, while the Miami, Florida, brand Delano is coming to Paris and to Sardinia’s Costa Smeralda.

Mendes told HOTELS that Accor isn’t pivoting into luxury, but rather completing its multi-segmented ecosystem. “In six to seven years, we’ve moved from a midscale European economy brand to becoming global with less than 50% of our properties in Europe and more than 40% of our business in luxury lifestyle,” he said. “It’s a big change, but we haven’t forgotten our key brands of the past; 40% of development is for historic brands with 150 Ibis and 50 to 60 Novotels and Mercures opened each year. Now 25% of new development is lifestyle properties.”

“My dream would be to have a mix of business, city and leisure hotels like Delano, Faena, Jo&Joe and Mama Shelter in all key destinations such as Cannes, London, Marrakech and Dubai,” Mendes added. “However, there are no plans to merge these brands, because the more we have, the better we capture different kinds of needs.”

Luxury is all about diversification for different personality types and experiences, so a wider range of brands lets Accor achieve greater market share. For top-tier guests, the 5% of the 66 million in the Accor Live Limitless loyalty program, the group focuses on status recognition, upgrades and hyper personalization through diamond- and elite-level experiences shaped by each destination’s qualities. 

Innovation forward

With motivations for travel and hotel visits changing, Accor is moving into “augmented” lifestyle hospitality to attract new kinds of business. The group’s Innovation Lab looks at market and consumer trends to develop alternative solutions. 

One outcome was the partnership with designer Ora-Ïto to create Flying Nest — shipping containers repurposed as hotel rooms that can be relocated for temporary accommodation.

Another creation was Greet, Accor’s new brand for independent, 50- to 150-room hotels looking for a distribution platform. Conceived to be local, sustainable and socially responsible, owners work with Accor’s designers who reuse each hotel’s furniture and commission neighborhood artisans.

Mendes said the lab is currently looking at healthy, mindfulness-oriented trends and will carry out pilot experiences to develop brands in this arena.

A long-lasting trend the lab identified is “workspitality,” which led to the prescient launch of Wojo two years ago. Created for people without proper office setups at home, portions of hotels across different Accor brands are transformed into remote workspaces. But Wojo isn’t simply monetizing something guests were already doing; there are free co-working areas and a 20% food and beverage discount. In Paris, the company is trialing an app to identify locations. Some companies are renting multiple guestrooms converted to offices. With 160 pilot sites in Latin America and 300 in Europe, Wojo will grow to 400 locations this year.

Given the current average occupancy rate of 50% to 60%, and the prediction that, motivated by sustainability and greater life balance, people won’t return to offices five days a week, it makes sense for Accor to repurpose its real estate. Mendes called it agile adaptation. For example, beds are removed from guestrooms, transforming them to offices or spa treatment rooms.

City-center convention hotels like the Pullman Paris Tour Eiffel converted rooms into spa facilities, while meeting rooms have become mindfulness centers — ideal for the curated playlist Novotel developed with mindfulness app Calm. “It’s very easy to adapt,” Mendes said, “and if business returns in three years, we’ll be pleased to go back. It’s not a huge investment.”

Safety and security are, of course, top priority. Developed with Bureau Veritas, 90% of Accor properties have now implemented AllSafe standards that monitor testing, inspection and certify cleanliness, Mendes said. In addition, a new partnership with Axa Insurance allows guests to tele-consult with medical providers.

As part of a focus on well-being, guests want more immersion in nature. Accor is expanding its resort offerings through its joint venture with Rixos and by introducing Pullman and Fairmont properties in Dubai, Singapore and Canada. “In the last eight years, 80% to 90% of Accor’s hotel development was in business and city centers, so the group wants to balance that with countryside destinations,” Mendes said.

Conversions are the key to accelerated growth. “More than 70% of the world’s hotels are independent, so there’s a big movement to convert nice independent hotels in natural places,” he said.

Increased respect for nature is driving attention to sustainability. More than ever before, the decision to travel must be weighed against its carbon footprint. With access to international destinations restricted, frustrated would-be travelers are driving demand for staycations and local experiences, which means Accor’s hotels are expanding their entertainment repertoire.

Family stays are up, raising the need for more guestrooms with connecting doors as people rediscover their own countries. In response, Accor is anchoring its hotels to local attractions and highlighting regional gastronomy to encourage longer stays.

When Mendes needs an escape, he hits the open road on his BMW 1200 motorcycle. “With a motorbike you discover the world differently,” he said. “Every year, I go on a 10-day off-road adventure with my wife and good friends — places like Bolivia, Columbia and Patagonia. No WiFi, alternative accommodation and cultural discovery.”

Mendes is confident there’s a travel boom on the horizon once the vaccine is widely administered, but predicts travel will be different with an emphasis on natural surroundings, staycations, domestic holidays, closeness with family, social connections, interesting experiences, sense and purpose, and more balanced lives working from destinations, whether Asia or the countryside. “It’s evident we will travel a lot, and tourism and hospitality have a bright future.”

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