Marriott takes aim at Airbnb
The world’s largest luxury hotelier, Marriott International, has homestay market leader Airbnb firmly in its sights. The larger company, however, is not trying to muscle Airbnb out of the space by cloning its business model – rather, it’s proposing an alternative model that it thinks will be more appealing to the kind of high-end travellers it relies on to support its 1.3 million hotel rooms across 30 brands.
Marriott’s share price has appreciated by 32% so far this year
Source: Yahoo Finance
Marriott has recently launched Homes & Villas by Marriott International, a business it trialled in four European countries last year. Now, that business encompasses 2,000 premium and luxury rental homes in 100 locations in the U.S., Europe, the Caribbean, and Latin America. And here’s the thing: unlike Airbnb, where you typically rent a room or flat, Homes & Villas offers you the option to rent out entire luxury homes. This is unsurprisingly targeted at the high-end of the homestay market, and comes with an important competitive advantage: the new business is fully integrated into Marriott’s best-in-class loyalty scheme.
That loyalty scheme is hugely popular with regular customers, and the incentive to use Homes & Villas by Marriott International and earn reward points that can be spent at its other locations may prove to be an attractive one.
The company’s CEO, Arne Sorenson, said he has big plans for this part of the business – although he declined to explain what, exactly, they were. Instead, he showed a simple confidence in the strategy, saying: “We think this could be a place where we can be quite competitive. We think this space is wide open for us.”
Dominion holds Marriott International in its Global Trends Luxury Fund.
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