PARIS--Accor unveiled a new strategy for its economy brands, introducing a family of ibis brands called ibis, ibis styles and ibis budget.
“Today we are launching a large-scale project to establish Accor as the world reference in the hotel industry capable of inventing the hotels of the future. This major initiative will involve all our teams. To do so, we will rely on the Accor brand that we intend to make more visible to the general public in particular, in order to meet distribution challenges. Our ambition is reflected through a new signature: “Open New Frontiers in Hospitality” and through stronger identity symbols. Our objective is to offer a new, unique hotel experience with repositioned brands and modern, innovative services”, declares Denis Hennequin, Accor Chairman and Chief Executive Officer.
“I have decided to challenge some of the basics of our business model: change is not an option, it is a necessity. The first part of our project concerns the economy segment. With our international leadership, we will revolutionize our economy brand portfolio around the ibis brand, which benefits from unrivalled worldwide notoriety. Consequently, ibis, Etap hotel and all seasons will evolve into a group of three strong, innovative, modernized brands and become ibis, ibis styles and ibis budget. “ibis” is now the keystone of our economy portfolio”, adds Denis Hennequin.
The economy brand dynamization strategy
Observation of constantly evolving life styles and consumption modes was the starting point of Accor’s reflection on its economy brands.
Consumer expectations have evolved significantly. The vertical segmentation of economy to upscale brands is a thing of the past. Now, all brands must be able to project a self-enhancing image to their customers and offer modern, contemporary, stylish services.
For that reason, Accor felt that the group’s economy hotel products and services needed to be re-invented so they could go beyond their market segment and cater for the changes in consumer expectations.
ibis becomes a Mega Brand with three brands:
- ibis, which remains ibis,
- all seasons, which will become ‘ibis styles’
- Etap Hotel, which will become ‘ibis budget’
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The implementation of this new segmentation – which will be completed worldwide by early 2013 – will increase the clarity, consistency and strength of the three economy brands, will enable Accor to achieve critical mass in several markets and will also boost each brand’s notoriety and growth potential.
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, 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:
- Strengthen our economy brands’ notoriety and boost customer satisfaction,
- Improve the efficiency of our distribution and loyalty systems through the sharing of channels and tools,
- Ensure the expansion of these brands worldwide.
ACCOR : “Open New Frontiers in Hospitality”
Accor is now a pure-player hotel group’s brand. Denis Hennequin believes the time is 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, notably 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 reinforced 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 New Era
Accor also today announced a number of major changes concerning 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.
• The Accor brand is being deployed with a new baseline – “Open New Frontiers in Hospitality” – and a new identity, especially for use in loyalty programs and distribution.
• ibis has become the keystone of a new architecture for the Group’s economy brands, with all seasons becoming ibis Styles and Etap Hotel becoming ibis Budget. This change will be supported by an ambitious plan to revitalize hotel products and services.
• Motel 6’s transition to an asset-light model has been accelerated considerably. This mission has been assigned to Jim Amorosia, the brand’s new CEO and the first American to hold the position since Accor acquired Motel 6 in 1991.
• Accor is revising its development objectives upwards. The Group will open 35,000 rooms in 2011 and has now set a target of opening 40,000 rooms a year beginning in 2012. It will meet this goal through organic growth and targeted acquisitions in Europe, Asia-Pacific and Latin America, while maintaining the overall objective of an 80% asset-light hotel portfolio by 2015.
• In line with its long-term strategy of optimizing the hotel portfolio, Accor is reconfirming the asset management plan already underway and announcing a new plan for the 2013-2015 period that will have an impact of €1 billion on adjusted net debt. This will bring the total to €2.2 billion for the 2011-2015 period.
• Accor will leverage the unrivaled capabilities and expertise provided by its unique business model: a distribution system that accounts for nearly 60% of room revenue and operating excellence, especially in the areas of revenue management, purchasing and cost control. This expertise will be developed and shared with all Group hotels, whether owned and leased, managed or franchised.
• With high ambitions and strengthened management tools, the Group has set the following targets:
- Generate sustainable positive free cash flow.
- Over the medium term, improve the Group’s EBIT margin by 2-4 points, in particular by optimizing the performance at hotels owned by the Group or leased under fixed or variable leases.
Outlook for 2011. Concerning the year underway and based on the following factors:
- An excellent first half and promising summer-season trends in all regions.
- The absence of any signs of a slowdown in demand to date.
- A flow-through ratio objective at EBITDAR level confirmed at 50%.
Accor is announcing a 2011 EBIT target of €510 million to €530 million.