Chinese Hotel and airlines associations emerging
Hotel groups are coming together and pooling resources to survive this critical juncture and entering an age of associations and alliances.
The airline-affiliated hotels of Air China, China Southern Airlines and Xiamen Air will likely form an association along with China Eastern Airlines and Lucky Air to share loyalty program and redemption benefits for their frequent flyers, according to SZA Hotels Group and Shenzhen Hotel Industry Association executive director Jian Huang, who added this is likely to happen after the Spring Festival.
“Airline-affiliated hotels have two major advantages: airports and airlines. It is a fact that airlines have their own hotels and their frequent fliers, and frequent fliers don’t care which airline or hotel offers them services,” Mr. Huang said.
Currently airlines are faced with an embarrassing hotel shortage for frequent flyers with redeemable points. Shenzhen Airlines has 20 hotels but over 3 million frequent flyers including more than 40,000 gold card members. Air China has only 30 hotels for millions of its Phoenix miles card holders.
Huamei Consulting CIO Huanyuan Zhao said: “Airlines have good mileage programs and an ever growing customer base, so it presents an ideal opportunity for the association to become stronger than other hotel associations.”
In December 2014, China Lodging Group (CLG) CEO Ji Li said the group would establish a “mega hotel association” in the coming years linking 3,000 three-star and four-star select hotels, 1,000 boutique hotels and 6,000 directly-managed and licensed hotels across China.
Besides CLG’s mega association, CTS Hong Kong Grand Metro Park Hotel Group and Plateno Hotel Group have formed a membership association in August 2014 enabling their members to book on each other’s platforms. New Century Hotels and Celebrity City Hotels made a brand marketing alliance to link their data systems in September 2014.
Mr Zhao said hotel groups are coming together and pooling resources to survive this critical juncture in the hotel industry. “Now China’s hotel industry is truly entering the age of associations and alliances,” he said.(Translation by David)