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There was a time when the big global hotel chains owned hotels or had some equity in them. They were fond of saying they were not just an operator but an owner, hence they could run the business better than an operator only, since they understood being both.
Now everyone’s gone asset-light and why not — less risk, low capital, high cash. Even in bad times, the management fees would roll in as chains keep signing up new hotels.
Who’d blame the Asian owner for being mind-boggled: “Hey, my RevPAR (revenue per available room) is down, and you’re adding more hotels to compete with me?” Or for losing sight of the fact that chains — like online travel agencies with whom owners also have a love-hate relationship — do have to keep investing on customer acquisition, technology, brand building, and more in order to win over guests for owners.
Tempers have flared all the way to court, as our report below on The Peninsula Bangkok, and recent reporting on JW Marriott Phuket, shows. With the trade war and Hong Kong protests showing no signs of resolution, a couple more legal cases should not come as a surprise to anyone.
To avoid them, chains must be more sensitive to owners — and do more. What, for example, are they doing to help owners in Hong Kong, apart from consoling them that Hong Kong will come back one day?
After all, at one time chains were owners.
Or so they said.
Skift Stories and More Expert Insights
Accor CEO to Doubters in Asia: Our Brand-Heavy Strategy Is Working: Having more brands when cheap money is chasing real estate is good for Accor, but may not be for its hotel owners. This is especially true in Asia where owners are hoping that in time it won’t be a case of too many Accor hotels chasing too few hotel guests.
Peninsula Parent’s Thailand Dispute Shows Perils of Owner-Chain Relations: This is a high-profile case that pits a powerful Thai family against a reputable global luxury hotel brand. It also spotlights the reality that this won’t be the last of owner-and-chain disputes, especially not when times are getting harder.
Agoda Is Starting to Offer Flights to Take On Rivals in Asia: Flights are the next big thing for all of Booking Holdings’ accommodation platforms, not just Booking.com but Agoda and Priceline in Asia. In the region, where super-apps have taught consumers they can book everything on one app, and where even airlines want to be online travel agencies, it isn’t surprising Agoda is offering flights.
Ctrip’s Bigger Hand in MakeMyTrip May Speed it Toward Break-Even: India’s largest online travel agency may beat analysts’ expectations and break even sooner rather than later. Ctrip, which now owns nearly half of the company, could be a factor. Another is boosting hotel content, which offers higher margins than air.
Rugby World Cup Serves as Tourism Warm-Up for Japan’s 2020 Olympics Push: There are no shortage of reasons for tourists to want to visit Japan. But using international sports events as a way to signal that Japan is growing more accessible will certainly help broaden its appeal to those less adventurous travelers.
5 Takeaways From the UK’s Thomas Cook Inquiry: Inquiries like these are often pretty brutal on company executives. Former CEO Peter Fankhauser shoulders a lot of responsibility for what went down at Thomas Cook but he’s not the only one at fault. The actions of his predecessors, as well as the UK government itself, are likely to also come under scrutiny.
Asia Editor Raini Hamdi [email@example.com] curates the Skift Asia Weekly newsletter. Skift emails the newsletter every Wednesday.