China tourist boom drives Marriott expansion

China tourist boom drives Marriott expansion

Thu, 12/04/2018 - 16:34
ocean park

Marriott's Hong Kong Ocean Park hotel is typical of the ultra-luxury properties in the hotel chain's development pipeline. Photo: Marriott International

The world’s largest hotel chain is sharpening its focus on the Asia Pacific, investing heavily to capitalise on the increasing mobilisation of Chinese tourists.

Even after a record 4.5 billion domestic and overseas trips made by Chinese tourists in 2017, the number of travellers is again expected to grow in 2018, according to the Chinese Academy of Social Science.

In response to what has quickly become known as China’s mass tourism era, Marriott International, which operates more than 6,500 hotels in 30 countries worldwide, has embarked on a record expansion.

Following its acquisition of Starwood Hotels in 2016, Marriott International has become the world’s pre-eminent luxury hotels operator, with brands such as St Regis Hotels and Resorts, Ritz-Carlton, Westin, and Le Meridien among its growing portfolio.

In 2017, the group and its franchisees opened 470 hotels comprising 76,000 new rooms around the world, while also signing more than 750 contracts for new properties.

In China and Australia, 35 new properties were opened in 2017, while 19 per cent of developments in the pipeline were in China.

Included in the pipeline are luxury Ritz-Carlton hotels in Perth and Melbourne and St Regis properties in Shenzhen and Zhuhai.

Marriott International senior director Jane Cai told Australia China Business Review that destination appeal and favourable macroeconomic forces had fuelled growing demand for hotels in key destinations in Australia and China.

This increase in leisure and corporate travel demand has occurred in a sustained environment of limited hotel supply growth, culminating in surging investor interest in hotel development – particularly in Australia’s capital cities,” Ms Cai said.

“The current wave of hotel development in Australia is characterised by a dual focus on iconic luxury brands and the introduction of new select service brands targeting burgeoning millennial (travellers) who value lifestyle, technology, and authentic experiences. 

“And China is the second largest economy in the world, with tremendous opportunity for both leisure and business travel.”

As well as opening a raft of new properties in China, Marriott has also partnered with Alibaba Group to enhance the travel experience for Chinese consumers.

The joint venture will draw on resources from both companies, marketing directly to Alibaba’s customer base through online platform Fliggy, provide links between loyalty programs and offer customised promotions for Chinese travellers.

Ms Cai said the international expansion had been driven by its acquisition of Starwood, which had resulted in unrivalled opportunities for hotel development.

“Our newfound scale is delivering immense benefits to the performance of our hotels – from procurement power and negotiating strength with online travel agents, to the groundbreaking partnership with the Alibaba, the world’s largest online retailer,” she said.

“We ended the year with a record 460,000 rooms in the development pipeline, with over half located outside of North America.

“Industry data shows that Marriott brands represented 7 per cent of worldwide room supply but an impressive 22 per cent of hotels under construction.”