Why the Shangri-La and Klook partnership Isn’t as odd as it seems
12/06/2018|3:55:27 PM|Skift

Shangri-La and Klook may seem to be strange bedfellows but their partnership of a hotel company and a tours booking outfit announced Wednesday shows their objectives are not incompatible.

Klook and Shangri-La will initially collaborate around three main areas:  Klook Concierge, Golden Circle Award Point Redemption and Marketing Collaborations.

The partnership also creates new revenue streams for both parties.

How does it work?

Shangri-La guests can book Klook experiences throughout their stay, even at the last minute, at the concierge desk via a tablet uploaded with a Klook app that has been tailored for the chain. The booking is redeemed via a QR code or an e-voucher. Now available at Shangri-La hotels in Singapore, Bangkok and Hong Kong, the Klook Concierge will be rolled out to the chain’s over 100 Shangri-La, Kerry, Jen and Traders hotels in 76 destinations globally next year.

The bill for the tour or activity will be included in the guest’s total check upon checkout. Golden Circle members will earn points for each booking made through the Klook Concierge.

Shangri-La is effectively selling Klook’s tours and activities and earns a cut. But the chain’s vice president of loyalty partner and marketing, Wee Kee Ng, told Skift this revenue is “secondary” to his chief goal of increasing the share of redemption, even if it’s by just 5%. Members typically redeem free nights, upgrades, dining at Shangri-La hotels but increasingly want “personal experiences beyond the hotel product,” Ng said. And a loyalty program that isn’t engaging for them is one that isn’t working, he added.

The collaboration also sees Shangri-La hotels going beyond selling rooms to curating new experiences to be offered on the Klook platform for anyone to buy. 

Let them eat cake

Klook’s Ngai said Shangri-La and Klook are “totally aligned on one thing — serving customers,” with their discussions in the past six months focusing on areas such as “what kind of activities should we show, what’s the user flow, are there customer service issues?”, rather than on the commercial aspects of the deal.

Ngai said: “Apart from our customer focus alignment, another reason we teamed up with Shangri-La is that they own and operate most of their hotels, unlike other chains that have become asset light. This makes the execution a lot easier.”

Asked if Klook will also work with other chains, Ngai said it is “almost impossible” to replicate the partnership with another chain given its wide scope.

The Shangri-La and Klook partnership isn’t the first attempt by hotel chains to incorporate tours and activities into their fold. Last year, Marriott International took a stake in tours-and-activities metasearch platform, PlacePass.

The difference is that Shangri-La, with over 100 hotels compared with the thousands that Marriott has, may be able to drive a deeper partnership with Klook, given also that it owns and controls most of its hotels. Both companies are based in Hong Kong.

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