tris06

I think another thing missing in this whole picture is that here is the assumption the biggest benefit will be Europeans going to US properties. And yet Accor is by far the most dominant in Asia Pacific which has more wealth these days than the US market and growing. Most people from Australia who have hotel loyalty membership are usually with Accor because of their large portfolio. Then on top of all this there will be Americans who will more likely stay at Fairmonts if they spend a decent amount of their travel money overseas in Europe and Asia as well as Asia as they will be able to earn with a very world wide portfolio.

Just like for example in comparison Hilton/ IHG has almost no presence in Australia/New Zealand markets. This means while Accor would prefer to keep the FRHI members to keep staying at Fairmonts and etc, they wont bend over backwards over such a small percentage of their total earning. Likely Accor members spending at Fairmont hotels will likely exceed what FRHI members spent before the 2nd of July 2018.

I for 1 would have considered staying at the New York Fairmont Plaza in June but oh well I will stay at Sofitel instead.
Also trying Shanghai and maybe the London property is on my radar in the near future.

escape4

At this stage we are only making guesses and predictions of what will happen going forward. The opinion of several people here is that there is a decent chunk of FPC loyal customers who will reduce their number of stays at Fairmont hotels. Rightly or wrongly.

While the above are guesses and predictions, this however, is not. Perhaps I should explain more clearly what I meant however. The price you pay to buy a hotel chain is in good part based on future income projections. If you lose customers/income from existing customers, then it is a mathematical fact that you have a steep hill to overcome for the purchase to turn out to be worth the money you paid for. You will need a boost in income coming from existing Accor customers, and/or a boost from customers who are currently not with either of Fairmont or Accor.

1flyer

Well, for one thing, you seem to equate most loyal customers with most valuable customers. This need not be the case. Furthermore, it's not clear that the most loyal customers account for a large fraction of the chain's overall profits. Maybe most people book Fairmonts and Raffles via luxury booking agents such as Virtuoso and such but don't care deeply about the loyalty programme. Maybe the customers you lose are replaced by new customers you win. It's not as clear-cut as you make it sound.

A different issue is that Accor didn't just buy FRHI for the cash flows it anticipates from existing Fairmont and Raffles properties. It's quite clear they were also buying expertise in the luxury segment which they want to apply to improve exisiting brands such as (SO) Sofitel. Lastly, we don't know how they valued the component Swissotel. In my mind, Swissotel fits very well in Accor's existing portfolio. I don't think they'll have lasting issues moving Swissotel Circle members over to LCAH. They should also enjoy synergies from managing Swissotel along with similar brands such as Pullman.

Bottom line: Even if it turns out they lose some profits at Fairmont properties (which I'm not convinced of), it still doesn't follow the takeover or the following integration of FRHI was--overall--a failure. Again, I think a few FPC elites over-estimate their importance.

Jasper2009

You're of course right that members of a smaller (generally more generous)program are rarely happy about being "integrated" into a larger (often less generous) program. The same is true for mergers / acquisitions / hostile takeovers in general. Do I necessarily believe that everyone who's now swearing that they'll not only leave Fairmont for the most part, but also make sure that Accor/Fairmont receive zero business from their department/company? Maybe. Maybe not.

Having talked to a sizable number of FPC members (FTers, clients, acquaintances, "random" FPC members I run into...) there are three main issues IMO:

(1) while FPC members could for the most part "stomach" some devaluation of benefits, many see the Le Club Accor program at the opposite end of the spectrum (i.e. offering few meaningful benefits, being uncompetitive with the major (US based) loyalty programs etc.). I'm fairly confident that you wouldn't see this much negative feedback if Fairmont had been acquired by Hyatt or Starwood, for instance.

(2) a general expectation that service levels will suffer in the mid-term; while some Accor properties indeed offer great service, you'll be hard-pressed to find many people who'll associate the Accor chain (as a whole) with outstanding service and a fantastic loyalty program; even the Accor forum "loyalists" frequently most very, hm, mixed experiences

(3) alienating as many people as possible during the integration process: Accor/Fairmont management promised to "keep the best of both programs". Sure, there's always some marketing fluff, but the acquisition/integration would've been a great opportunity to improve the Le Club Accor program, increase Accor's footproint in NA, build a strong reputation in the high-end / luxury hotel market etc. Instead management chose to essentially eliminate the FPC program,not make any changes to the (subpar) Le Club Accor program and hope for the best.

Time will tell whether this strategy will be successful.

Admiral Ackbar

I can only talk about France having live there for almost a decade but the concept of loyalty programs is foreign to them. Look at AF Frequence Plus which is laughable compared to NA loyalty programs. I was FP rouge at the time and compared to AC SE (especially at the time 1998-2006) the benefits were ridiculously bad. Now the client I worked for was one of AF's top customers so the VIP on my boarding passes took care of the discrepancy

But it is like another planet. Having been both Fairmont and Accor Plat,you see that discrepancy quite clearly and anyone who thinks Le Club is competitive is a)not a plat member in both programs or b) delusional.

1flyer

What's with the strawman? Nobody claimed LCAH is competitive with FPC.

Furthermore, the statement that the opinions of those who aren't top tier in both programs are "worthless" is again a fallacious appeal-to-authority argument.

Admiral Ackbar

I was answering Brendan's question about how the French view loyalty programs.

I removed the worhless comment, it was unwarranted. I was tying in my observation that the French don't know how to run loyalty programs into the fact that we are going from a great loyalty program to a bad one (from my perspective). Being plat in both helps me to compare. Was not directed at you specifically.

I have no idea how the merger will work out, I am sure Accor knows what it is doing being a huge multinational hospitality corporation.

Shenanigans

What you're describing here sounds like human nature, no? Who would ever be happy going from a Premier program to something more inferior? And who would not "thoroughly enjoy maximizing this program" and be less than happy that all of this is being scuttled?

At no point have I ever "exaggerated" my importance to the point of suggesting that Accor will miss my business which will most certainly diminish going forward. Quite to the contrary, I suspect that my wife and I care more about less visits to Fairmont properties than Accor ever will.

CanuckFlyHigh

I've spent about 25 nights in Fairmonts this year. Alot of the employees I know quite well over the years. The one's I know very well, are extremely unhappy with all of the cuts Accor is imposing on them. The one's I don't know well, but know well enough, are also pissed. They give the "no comment" response. That's not a good sign for the future of Fairmont.

CanadaDH

I've had similar communications. On a visit this year (to a property that will remain unnamed for obvious reasons), we had some of our favourite staff mention they had plans to go elsewhere, so we wouldn't be surprised when we returned the following year. It's disappointing to lose great people that you have built relationships with over many years at a hotel, and even more troubling when the reason for their leaving is a change in culture that can cause the loss of many staff at once, and with that, a change in culture for the staff that remain.

That's been my fear all along with the merger. Even the long time Accor travelers admit that their loyalty program sucks compared to other programs, and I think we all recognize that the loss of the FPC is a devaluation to the guest. That happens with loyalty programs, and how it will affect hotel revenue remains to be seen in the years to come. The bigger concern to me is how the quality of the Fairmont product (not the program) will suffer as a result of the merger and a change in policies, attitude toward customer service (or disservice, which is the reputation that Accor has earned) and employee culture. Change a loyalty program, and guests will grumble, but many will stay with the hotel. But remove the quality from a product or service, and you can create very big problems.

rny321

For the last few years, I have earned top tier status at more than one chain. Because of the customer service and the loyalty program at Fairmont, I chose that company’s hotels whenever practical rather than another company’s product. Although I believe Fairmont status was both easier to obtain and its loyalty program was more generous than other programs, once earned Fairmont Platinum status wasn’t so different from Starwood Platinum or Hyatt Globalist.

Since many programs offer points to its most loyal members equal to roughly 10% of the amount spent at hotels and some form of arrival gift, the small differences in earnings at different programs isn’t enough to change my preferences. With Starwood, I am entitled to the best available room including standard suites and lounge access. As part of Accor, I would be eligible for a one category space available upgrade and no lounge or breakfast at Fairmont’s. Unless the Fairmont is substantially less expensive or there is something truly special about the property or location, I would be far more likely to stay at a Starwood, Hilton or a Marriot than a Fairmont going forward.

I have stayed at Four Seasons and Mandarin Oriental hotels when I didn’t believe they had loyalty programs. IHG offers minimal loyally benefits and that hasn’t stopped me from occasionally staying at InterContinental’s. Although the stated upgrade policies at IHG and Accor aren’t identical, the differences aren’t dramatic. So, it’s possible that I will still pick a unique Fairmont hotel instead of another property where I would be entitled to more benefits as I have done in the past; it just won’t happen very often.

Hopefully, the culture at Fairmont won’t change over the next couple of years. If the quality of Fairmont customer service decreases due to employee turnover, I doubt that my family will have future Fairmont stays after my wife and I utilize our last rounds of certificates. As another poster stated, my family will miss Fairmont far more than Accor will miss the loss of revenue from us.

Eagle_traveler

I have been surprised at how loyal the employees were at Fairmont properties. You don't go to a property for years and then you go back and see a lot of the same employees. I guess it's gonna change

dts9

Does anyone know if they are offering the Passion benefits" this year like all previous years.

CanadaDH

Yes, the invitations to select the additional benefits came out on March 1. If you qualified last year for Platinum, you should have already been able to select them. However, if you qualify mid-year, I don't believe they apply.

dts9

Just received my Platinum package and it says that if you have two qualifying stays before July 2018, you will receive as a bonus another FULL set of e-certificates. Is it nights or stay, and do you really think the certs will be the same...