Despite Marriott's recent troubles in China, its joint venture with Alibaba appears to be moving forward without a hitch. As this story points out, the partnership looks like a win-win.
Last year, Marriott and Alibaba announced that they’re entering a joint venture in the Chinese market that would “deliver more personal digital travel services” for Chinese travelers. In essence, the joint venture was intended to manage and improve Marriott’s digital offerings in the Chinese market with the help of Alibaba’s technology and products. This year, Marriott and Alibaba’s ambitions are coming to fruition with a range of new offerings for Chinese customers.
The news of the joint venture’s new offerings in the Chinese market also comes at a time when Marriott is revamping its loyalty programs on a global scale. In a move that Skift describes as reflecting Marriott’s “Amazon-like ambitions in travel,” the hotel group is bringing together Marriott Rewards, Starwood Preferred Guest, and Ritz-Carlton Rewards under one umbrella as well as re-launching its local experiences marketplace.
Meanwhile, in China, Marriott and Alibaba announced that they will launch an “exclusive booking portal” next week. In practice, the China-focused booking portal is a “flagship” store on Alibaba’s online travel marketplace, Fliggy (formerly known as Alitrip). The Fliggy store will feature 600 properties in the Asia Pacific region, but the ambition is to eventually offer all 6,500 properties around the world on the platform.
Fliggy has previously partnered with other travel multinationals to launch so-called flagship stores on its marketplace. Among them are Lufthansa, Singapore Airlines, Cathay Pacific, Qantas, American Airlines, and, in the hotel space, Singapore’s Resorts World Sentosa.
But the joint venture with Alibaba goes beyond pure bookings.
By the end of the first half of 2018, Marriott says that it will have rolled out Alipay payments at close to a quarter of its properties around the world. The initial rollout is focused on “high-demand” markets in Europe and the Middle East, which will be joining the ranks of properties in China and the Asia Pacific that already accept Alipay payments.
If Alipay payments will eventually be available in all Marriott properties around the world remains unclear. However, accepting Alipay payments at properties in popular Chinese tourist destinations in North America seems like the obvious next step in the global rollout.
The news of what Marriott and Alibaba’s joint venture would materialize in comes months after the initial announcement, and at a time when outrage over Marriott’s blunders in China has quieted down.
At the beginning of 2018, Marriott found itself in an unexpected scandal in China after it had listed Taiwan, Tibet, Hong Kong, and Macau as “countries” in a drop-down list on its website. Around the same time, a social media staffer had accidentally liked a Tweet about Tibet when logged in as Marriott. Doubling down on its commitment to the China market, the company and its CEO issued profound apologies, condemned “separatism,” voluntarily closed its Chinese website, and fired the staffer, a 49-year-old Omaha man, for his error.
The company was criticized by many for bowing to Chinese government pressures, but was clearly successful in mitigating a potential PR and political nightmare in China that could have put its joint venture’s China ambitions in jeopardy.
For now, it seems like smooth sailing in the Chinese tourism market for Marriott and its joint venture with Alibaba. For Marriott, the benefits of courting Chinese tourists through Alibaba are obvious. For Alibaba, a strong partnership with the world’s largest hotel group both helps it expand products like Alipay internationally but also to supercharge its Fliggy platform as it’s trying to take on incumbent Ctrip and various Tencent-backed travel ventures.
This story originally appeared on Jing Travel, a Skift content partner.
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Photo Credit: The Sheraton Sanya Haitang Bay Resort, now part of Marriott International, is pictured in this photo from 2015. A Marriott partnership with Alibaba announced last year is bearing fruit. Michelle Lee / Flickr