PARIS, France (eTN) – We are in Bandung, the capital of West Java. The well-known city for its factory outlet stores and its outstanding collection of Art Deco buildings will soon have a new attraction: Asia’s biggest Ibis hotel, a 604-room property, which is due to open in 2012. The property will open at a time where Ibis is turning into the newest flagship brand of Accor Hotels group in the budget/moderate segment.
Accor’s new CEO and President, Denis Hennequin, previously at the top of McDonald’s Europe, gave a conference a few days ago in Paris to a few media to unveil its new strategy. After acquiring and multiplying brands in the previous decade, Accor is now consolidating its business around a few brands. The luxury segment is now under the brand Sofitel – already an independently-managed business entity – while first-class properties are shared between Pullman and M-Gallery hotels, and business style hotels are shared between Mercure and Novotel – twice parallel branding, which probably will need a strategic clarification in the near future.
In the budget segment, Accor is present with Ibis, All Seasons (a resort style product), and Etap Hotels/Formule 1. In an interview to French daily “Le Monde,” Mr. Hennequin said it will now consolidate its three brands in the budget segment under the Ibis umbrella. From 2012, Ibis will be divided into three different colors: the blue will be the shade of “Ibis Budget,” which will replace both Formule 1 and Etap Hotels brands; the red will be kept for the standard Ibis brand, which is equivalent to two- to three-star hotels; and the green will grace the new “Ibis Style,” previously All Seasons hotels.
Ibis is now Accor’s most profitable brand, generating an operating margin of over 40% and a gross margin of over 70%. Ibis’ average room rate is around €85 per night. According to Mr. Hennequin, the brand is considered “a little bit like Accor’s Big Mac,” an obious reference to his previous employer.
Accor has currently some 1,570 units around the world regrouped under its extended Ibis brand, representing 169,000 bed rooms or 36% of the group’s total capacity (4,229 hotels). A new logo will be created – a pillow declined in the new Ibis shades – and €150 million invested to upgrade Ibis Budget units with new lobbies, revamped external facades, and a more sophisticated food and beverage offer. The rebranding exercise should be finished by 2013. Accor plans to open an additional 10,000 bed units under its Ibis brand until 2015.