A New Marriott Division Goes Head-to-Head With Airbnb

With lodge firms feeling the competitors from the surging home-share business led by Airbnb, Marriott International has determined for those who can’t beat them, be part of them.

The firm, whose manufacturers span from the discount Courtyard by Marriott to the cosseting Ritz Carlton, is increasing a home-sharing experiment right into a full-fledged division that can hire you a St. Barts villa, a Lake Tahoe mountain residence or an Irish citadel.

The firm is betting huge on a market the place different lodge firms have but to succeed. The new Homes & Villas by Marriott International will supply 2,000 luxurious properties worldwide, starting from a one-bedroom residence for $200 an evening to that citadel in Ireland for $10,000 an evening.

The new division expands on an experiment final 12 months that provided 500 properties in Europe.

“The demand numbers are making hotel companies rethink who they fundamentally are,” stated Makarand Mody, an assistant professor of hospitality advertising within the School of Hospitality Administration at Boston University.

In a research he and colleagues printed this 12 months, Mr. Mody discovered that income per obtainable room, a standard lodge efficiency metric, fell by 2 % in 10 main American cities since Airbnb emerged in 2008. Airbnb’s disruption of the enterprise, he added, “has been a wake-up call for the hotel industry that there is a need to innovate.”

Marriott’s properties aren’t residence sharing within the sense that the proprietor offers you the keys or the door code, however the time period has successfully been stretched to incorporate leases managed by third-party firms. Its companions, together with LaCure and Loyd & Townsend Rose, vet properties for distinctive design and interesting places.

Marriott stated its trial final 12 months satisfied the corporate to leap in. Nearly 90 % of renters have been members of its loyalty program, Marriott Bonvoy. Most have been touring for leisure and, with a mean five-day keep, spent thrice as lengthy on the property as the standard lodge visitor.

“People stay at different hotels for different trip purposes,” stated Stephanie Linnartz, the worldwide chief business officer at Marriott. “Sometimes it’s a cool weekend with friends at a beach house and then a kid’s soccer tournament and you need a Courtyard,” referring to Marriott’s lower-cost model. “Home sharing is another offering.”

The firm’s plan, stated Chekitan S. Dev, a professor within the Hotel School of the S.C. Johnson College of Business at Cornell University, “retains any migration of lodging nights from conventional motels to home-sharing within the household.”

Marriott isn’t the primary lodge firm to dabble in residence sharing. In 2017, Hyatt invested in Oasis Collections, offering homes with high-end linens and concierge assistance, but sold it a year later. AccorHotels has the similarly serviced collection of homes called OneFineStay, though its year-end 2018 financial report indicated the investment had yet to pay off.

Early efforts by hotels to compete with Airbnb — which offers more than 6 million homes on its platform — illustrate the differences between traditional hotels, which may offer 300 similar rooms in one locale, versus a home share service, which rents unique units in possibly thousands of locales. Experts say hotels are challenged in the rental world in delivering the consistency they normally control and learning to manage far-flung properties.

“Hotel brands come with a seal of approval, but it’s harder to enforce,” said Eric Breon, the chief executive of Vacasa, a vacation property management company, which recently acquired Oasis. “There’s a lot more personality to people’s homes. They bought the beach house and furnished it. They’re not a hotelier to whom Marriott can say, ‘This year we’re doing all oval mirrors so you have to get rid of the square ones.’”

Marriott’s solutions to these challenges has been to stick to luxury properties and to contract with property management companies that take on the on-site logistics, including providing premium linens, high-speed Wi-Fi, in-person support and extras like cribs and high chairs. The expanded Homes & Villas have a minimum 3-night stay.

“Most travelers prefer hotels, so that’s still a robust market,” said Lorraine Wileo, a senior vice president at the travel research firm Phocuswright, which found that consumers prefer hotels over alternative accommodations by a two-to-one ratio. Hotel-branded homes, she added, may appeal to travelers who want the assurance of “cleanliness, security and amenities and don’t want a cookie-cutter hotel but aren’t ready to share an apartment with a stranger.”

Source link Nytimes.com

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