“The future of brands will be decided by consumers,” Dimitris Manikis, president EMEA, Wyndham Hotels & Resorts, told delegates at the IHIF EMEA 2024 on Tuesday.
Manikis was speaking on a panel of owners, operators and brands discussing the implementation of novel concepts to boost returns from hospitality real estate, moderated by David Kellett, managing director, Invesco Real Estate. The Wyndham executive told his peers: “We have 25 brands, 20 of which we acquired. But consumers will decide which brands make sense.” He referenced the added challenge of fashion, retail and car brands moving into the hospitality space, from Armani to Mercedes, and asked “where do you stop? Consumers will dictate that.”
Co-panellist Jean-Jacques Morin, group deputy CEO of Accor, who is also CEO of the firm’s premium midscale & economy division, said that Accor had been “ahead of the curve” in instigating brands. “We have 46 brands, more than anyone in the industry,” he said, “but that has been our strategy for some time – we haven’t needed to add new brands for three years.” He credited “the lifestyle evolution” with driving brand creation. “Everyone wants something different, something ‘Instagrammable’, that didn’t exist before, and you can’t fit that in a limited number of brands.”
For global hospitality management company Aimbridge Hospitality, brands are the firm’s bread and butter, said David Anderson, divisional president EMEA. “We globally manage 81 brands, and have to make sure that each team is aligned on aspects such as ESG,” he said. “But when it comes to making recommendations, we bring all the brands to the table to see which fits best in a particular market, while we remain agnostic.”
Speaking on behalf of Northern European hotel investor and owner Pandox, Jacob Rasin, SVP Transactions, gave the landlord perspective on brands. “I do think that size works, but you have to do your homework prior to signing a franchise agreement,” he said, noting that he didn’t really want to be a “guinea pig” on brands which might be doomed to fail, such as those with a low penetration in a particular market.
Business resilience
Turning to the topic of resilience, the panel reflected on pandemic-era strategies, with Rasin sharing a touching anecdote with the IHIF audience. “Our CEO, Anders Nissen, died of Covid in 2021. There has been a big vacuum since he left, both from a personal and a business aspect. I think about him every day, but the business goes on.” With Liia Nõu stepping up into the CEO role, Rasin said that a “bonding experience” ensued, which saw Pandox “grow as a team”. He added: “So when we got out of Covid we were very prepared for the turbulent times that we are now in. Anders would have been proud. Today, the team is stronger than ever, and we trust each other more than ever.”
Added Morin: “When you are in situations like Covid, you really see if there is a strong culture in the business. We care for people, but we are also in over 100 countries with 300,000 people working under our flags. Education was key during Covid, to ensure that values were shared.”
Said Manikis: “During the pandemic, hospitality gave people hope. The moment we opened up, people started travelling.”
Growth opportunities
Looking at growth opportunities through franchising, Morin suggested that different geographies were at different points in the cycle. “US is mature, Europe is in the middle, while Asia is at the start of the franchising journey,” he said. “In the end, we listen to the owner and what the market wants.” He said that while brands like Ibis could move quickly to establish new franchises, that wasn’t suitable for all brands, some of which needed to be more circumspect about market expansion.
Added Anderson: “We follow the money. Spain is a key focus – we launched there last year, and it’s seeing record transactions and lots of foreign money. So Spain, Italy and maybe Greece are on the horizon.”
Said Morin: “We follow the money too, and see the centre of gravity moving east. That’s where population growth will be, where the money is currently moving.” He identified the Middle East and Asia as particularly interesting opportunities for growth, adding that “government support” in those regions was sometimes significant.
Quipped Manikis: “We don’t follow the money - we follow the planes, wherever people are flying to.” He cited regions such as “CIS excluding Russia, and booming India” as interesting markets and said that Wyndham was “betting heavily on extended stays”.
Rasin concluded: “We follow the mining trucks in northern Sweden,” to the amusement of the panel and audience. He clarified: “There’s tremendous activity from NATO expansion, and the growth of industries like green steel and battery storage. In the dead of winter, there’s a huge opportunity for successful F&B as everyone stays in their hotels at night!”