Chris Hartley
Since its creation in 2004, the Global Hotel Alliance--a group that includes such brands as Omni, Kempinski, Pan Pacific and Leela Palaces--has grown to include almost 300 hotels. "We've grown from being an idea to being an organization that now employs quite a few people, has substantial shared infrastructure with the member brands and quite an extensive range of products and services," GHA CEO Chris Hartley said. More recently, the alliance has introduced a loyalty program--a "long-term dream," according to Hartley--and partnered with travel management companies and meetings management agency HelmsBriscoe to boost corporate business. Excerpts from Hartley's interview with The Transnational's Michael B. Baker follow.
What benefits have hotels seen from participating in the alliance?
By the end of this year, all but one brand will be fully linked into our central technology. That enables brands to share website bookings. It enables us to be able to provide much improved interfaces with central technology, our loyalty technology. That has a very positive impact on bookings. It's all about having the right price in front of the right customer at the right time. Our site, for example, is now fully interfaced with the brands' CRSs, and that's definitely how brands see growth in bookings, and us as well on their behalf. That's definitely been a critical factor in the success of the alliance. With the loyalty program, in the first six months it looks like we've managed to generate several million dollars in cross-sale business between the brands. It looks like already this could be 4 to 5 percent of our total business coming through cross-sold revenue. The numbers look much stronger than we expected after such a little time. We had a long-term goal to get 10 percent of our business moving through the brands.
How does the centralization of saleswork under the alliance?
That's been another long-term project. At the end of last year, we launched our third formal shared-services environment, in New York. That enables us for the first time to be able to negotiate global partnerships on behalf of the alliance. We started last year with Carlson Wagonlit Travel, and this year we've signed American Express and BCD Travel, so we've got the three biggest travel management companies as travel partners. We co-manage that relationship through a shared office in New York. Certainly the results from the CWT partnerships in 2010 were fantastic, and we were significantly ahead in market share. We saw 27 percent growth in traffic through the relationship. If we continue to see growth like that with these other partners, then I think we can see those shared offices expanding into new markets.
Is your goal to add more brands and hotels?
Our focus is on delivering value to the members who essentially co-own the alliance. We're not a company whose primary focus is making money for the alliance. That was never the purpose. Other businesses may have the need to expand for the sake of expanding. That said, we do want to expand because we don't cover all the key markets at the moment. We're going to be announcing shortly some new partners, specifically in markets such as Italy, where we don't have any coverage. Spain is another market we're working on, as is southern Africa. Japan also is a big market where we'd like to have more presence. We're in South America but would like to see more presence, and in Central America as well. We need to find brands to fill those gaps. Once we do that--probably close to 20 brands and 500 hotels--we can take stock as to whether the members want to grow. We want to avoid overlap. We want to help each other, and the best way is to be mutually exclusive in the way we operate. The long-term expectation over the next two to three years is that we will grow but our growth will slow down, and we'll be able to focus more on deriving maximum value from the products we created.
What drove the launch of a loyalty program, and will individual hotel brands in the alliance continue to maintain their own?
When we created the alliance, we felt that we had the opportunity to do something serious from a customer-facing point of view. The loyalty program was an ambition a lot of the brands held. After several years work, we managed to create and launch a program that bound all 12 individual brands together under one umbrella product, which we are now busy selling. We hope to deliver rewarding experiences to what's almost 1.5 million guests now. There were two or three programs operating individually. The biggest of those is Omni Select Guest, which remains intact as a program, except it's under the umbrella of GHA Discovery, so the technologies, benefits and rewards are aligned. The value for the customer is the same whether they are a member of Omni Select Guest or if they joined GHA Discovery through any of the other brands. The other brands, like Kempinski and Marco Polo, had much smaller programs, and bit by bit over the last year they just folded their programs into ours completely to create efficiencies. It's only really Omni Select Guest that continues to operate as an identifiable program in its own right, but it's fully incorporated under the GHA Discovery banner.
What benefits do you expect from your recently announced partnership with HelmsBriscoe?
HelmsBriscoe in the U.S. flirts with being one the leading meetings organizations, and they've started expanding their business overseas into Europe and Asia, and we saw a great opportunity to partner in their expansion outside of the United States. Omni was already a partner, and Pan Pacific was already a partner. A preferred partner means we basically recognize each other's partnership, giving each other certain priority and preferential treatment. We elected to have a global deal with HelmsBriscoe, where basically all of our hotels join a global partnership with HelmsBriscoe. That means whatever they're opening up in Sydney, Frankfurt or Shanghai, they'll automatically be recommending and pushing GHA hotels whenever they get the opportunity as one of their preferred partners.