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There’s a split developing among major hotels chains that are open to learning from and collaborating with sharing-economy lodging companies and those that want to dismiss them out of competitive and legal concerns at all costs.
Enter Onefinestay, the London-based startup that rents out members’ upscale homes in London, Pars, New York and Los Angeles, and Hyatt hotels, which took part in a $40 million funding round in Onefinestay last year.
Onefinestay co-founder and CEO Greg Marsh says the collaboration between his company and the Chicago-based hotel chain, with its 11 brands and 600 properties worldwide, has evolved beyond the funding relationship with the two lodging companies exploring multiple ways to cooperate in the future.
The two companies, which see themselves as complementary in some respects, have been conducting a modest pilot program at the 5-star Hyatt Regency London – The Churchill over the past year.
Marsh says Onefinestay guests, who might be flying into London on a red-eye flight, have been optionally storing their bags and/or using guest rooms at The Churchill to freshen up or tour the city while they wait for their vacation rental to be available for check-in.
These Onefinestay guests, who might be traveling in groups of three, four or more people and for periods of several days or a week or two, wouldn’t necessarily find a hotel stay as the most practical option to see the city so it isn’t as though this is taking business away from Hyatt or another hotel, Marsh says.
In a hotel, Marsh adds, perhaps these guests would require several adjoining rooms and this would often be an expensive way to visit a city.
“The game here is about exploring,” Marsh says. “The opportunity here is recognizing this is a new type of activity and trying to understand it and meeting guests’ needs as best we can.”
A Trend That Will Accelerate in the Future
Marsh says the feedback about the program, with guests being informed of the option of using facilities at The Churchill during the Onefinestay booking process, has been “very positive.”
Let’s face it: This pilot program at one Hyatt property in London in itself isn’t going to be a game-changer. But it is the start of a trend that will gain momentum.
Marsh says Onefinestay is exploring additional ways of working with Hyatt and other hotel groups.
It appears that hotel loyalty programs may be fertile ground for these types of partnerships between sharing economy companies and traditional hotels. Marsh points to a use case where a business traveler may stay at hotels for work for 20 to 100 nights per year and may seek redemption opportunities with traditional hotels and sharing economy stays too when traveling for leisure.
“It is natural for them to look for redemption opportunities in traditional hotels and with families in city centers,” Marsh says. “It’s an obvious fit for a business like Onefinestay to partner with loyalty programs to give folks the best of both worlds.”
Did Marriott Seek to Partner With Airbnb?
Hyatt isn’t the only hotel chain looking for ways to tap into the sharing economy. Separate from the Onefinestay and Hyatt collaboration, Marriott was believed to be exploring a redemption program for Marriott Rewards members with Airbnb but the partnership idea was squelched when some Marriott hotel owners learned of the idea and expressed their displeasure.
Marriott and Airbnb didn’t immediately respond to requests for comment on the apparently aborted partnership.
Leaders of some hotel chains are looking to learn from the sharing economy or even to get involved by expanding vacation rental options, for example.
Hyatt has invested in Onefinestay and they are conduting the beta at The Churchill, Marriott is believed to have explored ways to offer Airbnb stays as a redemption option, and Choice Hotels CEO Stephen Joyce is on record as saying that the chain wants to see how it can take advantage of the trend and make some money.
Meanwhile, the U.S. hotel industry’s trade group, the American Hotel & Lodging Association, views the sharing economy largely from a single lens, calling on Airbnb and its peers to play fair, abide by local regulations and pay taxes.
In his inaugural blog post, Best Western CEO David Kong had only one positive thing to say about the sharing economy. “For starters, I think it’s important to note that Airbnb has achieved a remarkable expansion in a relatively short period of time,” Kong wrote.
Much of the rest of Kong’s post correctly attacked the sharing economy’s excesses, including the proliferation of illegal hotels and some hosts’ avoidance of paying taxes, and he called for a leveling of the playing field.
But what the Hyatt-Onefinestay investment and partnership symbolizes is that the traditional hotel industry is beginning to find ways to work with sharing-economy companies, will adopt some of their best practices and in some cases will alter their own business models to accommodate the trend.