Paula: Welcome to Let’s Talk Loyalty, an industry podcast for loyalty marketing professionals. I’m your host, Paula Thomas, and if you work in loyalty marketing, join me every week to learn the latest ideas from loyalty specialists around the world.
This show is brought to you by the Loyalty & Awards Conference, the leading annual event for loyalty professionals in the travel industry. Make sure to join us this year from the ninth to the 11th of October in Rio De Janeiro for the perfect mix of inspiring content and exciting awards. Check out loyaltyandawards.com for more information and to register.
Hello and welcome to episode 359 of Let’s Talk Loyalty, a fascinating conversation about the power of their loyalty program to drive commercial value for one of the world’s leading hospitality groups – Accor. Headquartered in France, The Accor Group operates over 5,400 hotels in 110 countries across 40 brands from luxury to economy.
Each with its own distinct personality, price point, and brand promise. But as Accor brands, they can each enjoy access to the ALL program, which combines compelling recognition and rewards for guests with their all-in-one booking platform. All – Accor Live limitless focuses on making life simple yet special.
So I was delighted to be joined by Mehdi Hemici, Accor’s Chief Loyalty and e-Commerce Officer to hear the incredible journey that the business has taken to truly deliver this industry leading program. As well as explaining their approach and his insights for the ALL program, Mehdi also shares their latest proposition, ALL Plus, which has just been launched in May, 2023.
A subscription-based proposition which combines the power of rational value with extra peace of mind for guests. I hope you enjoy my conversation with Mehdi Hemici from Accor.
So Mehdi Hemici, welcome to Let’s Talk Loyalty.
Mehdi: Thank you for having me, Paula.
Paula: It’s very exciting to finally have you on the show, Mehdi. I was super impressed when I first met you actually at the Loyalty & Awards conference here in Dubai, which I can’t believe, I think is already a year and a half ago. And then of course in Madrid again, you did some wonderful presentations.
So I’m very impressed with everything that Accor is doing and really excited to dive into the story today. So before we get started, as you know with Let’s Talk Loyalty, we always, first of all ask our guests what is their personal favorite loyalty program so that we can get a sense of what inspires and motivates you.
Mehdi: The favorite loyalty program that sticks in my mind is actually built on personal experience and may not seem to be a loyalty program, but at the heart it truly is. It’s the American Express Platinum Card. Ooh. Um, yeah. So I, I had the privilege of, uh, working for, for, for Amex and, and, and contributing to, to the success of this product across international, uh, for quite a few years.
And when you think about it, um, we’re talking about a credit card. It’s, it’s completely transactional. It literally gets money out of the merchant account, uh, from the consumer to the merchant account. Apologies. And, and at the end of the day, it’s completely transactional. Yet American Express talks about membership.
And it’s a billion part of a club. It’s actually a number of benefits are associated solely with the card. You purchase the card not for its functionality. You actually renew your membership because you have benefits that resonate with your lifestyle and it’s incredibly powerful when you’re able to turn what is a piece of plastic that’s fully transactional into something that resonates much more than a transaction and becomes an emotional benefit.
I think that’s what, uh, American Express has been able to do. It’s quite impressive.
Paula: It’s incredibly impressive Mehdi and I really think it’s one that actually was perhaps the first to really nail that emotional loyalty proposition that we talk about so much. So I think you did about nine years there. Am I right Mehdi in terms of your own career with American Express?
Mehdi: No. That’s correct. I had, uh, several positions there and, uh, I spent about, um, three years on the super premium portfolio of American Express Platinum and its insuring card, the black card that everybody talks about. It’s also something interesting, right?
It’s aspirational. What they’ve been able to do is create aspiration. You want to be part of it, and sometimes you’re not even allowed to be part of the club. And by invitation only, you know, they’ve created a lot of halo effects, which I think are very smart and a number of different loyalty, um, platforms and companies have been inspired by American Express and that’s why.
Paula: Yeah.
Mehdi: Quite simply it’s my favorite, one of my favorite loyalty program.
Paula: Okay, well, very well answered and, uh, we’ll definitely have to get Amex on the show at some point. And actually, you’ve reminded me of a funny thing that I learned on a, on a direct marketing training program, Mehdi and I, this is slightly off topic, but it was an American Express case study.
It may not just be an urban myth, but they did say that there was an accidental mailing sent out to, I think it was the black tier, where you know that mail merge where it should be Dear Paula, Dear Mehdi. Instead it said, Dear Rich Bastard , forgive the French. But apparently they got absolutely no complaints.
Everybody, I think, was so flattered, and so amused by the fact that that actually went out in full print run production. So I’m giggling away to myself though. So thank you for bringing back a fond memory. I think, uh, marketing can be funny when it’s imperfect.
Mehdi: Absolutely. Well that goes, go, indicates the power of the brand, right? You even excused for being called some, somebody else, uh, somebody else’s name. Um, no. It’s quite impressive, but I, I didn’t know this anecdote. It’s quite funny.
Paula: It’s quite funny. Absolutely. So tell us a bit about the rest of your career then, pre-Accor who’re obviously gonna get into the work you’re doing here, but what kind of other roles have you been doing?
Mehdi: Well, um, firstly that my roles are really conditioned by who I am and I think as a, as a professional, ya, it’s uh, it’s also your upbringing where you come from. And at the end of the day, you know, I was practically, um, biologically engineered, let’s just say, to work internationally. Um, my father’s Algerian, my mother’s French.
I lived about, uh, 12 to 15 years in the UK hence this weird English accent that I carry. And, and, and, and so I’ve always really being, um, looking out for international opportunities and being fortunate enough to do that and mm-hmm. , most of my roles have been around designing consumer strategies in hospitality, travel, lifestyle or payment industries.
And in most instances it’s been around, um, business transformation, business development. And, and, and then looking after the customer, um, around loyalty, distribution, partnerships, customer experience. And all, all of those aspects that really are around the consumer relationship.
Um, my early days started out at KPMG. Uh, I worked in hospitality for about 10 years. Then I worked for American Express for about nine years and then I come back to my original love of hospitality. Um, at Accor where, um, I run now the, um, the loyalty program as well as, um, customer engagement, which includes CRM, partnerships and sponsorships and e-commerce.
So it’s the full interaction with a consumer, be it the way that they actually book a hotel through our direct channels. But how we continue to establish a relationship with the customer, understanding or, and even anticipating needs. And having a, an ongoing marketing interaction based on value so that we drive loyalty.
Paula: Yeah. Yeah. And, and actually I think that’s what first landed for me, Mehdi, when I saw you, uh, you know, speaking that first time, because I come from an e-commerce background. I was actually the first head of e-commerce for Emirate’s Airline here in Dubai, uh, many years ago, back in the year 2000 when, uh, e-commerce was barely, barely a word, but, but at the time, I suppose loyalty was the perfect lever to connect those transactional relationships with, again, that loyal feeling that we were trying to generate as an airline.
So I think the fact that your role actually combines those two and the all program of course as well, combines those two to me is quite innovative because it really is the, the best of both worlds, I guess for the, for the guest because it’s the sales side and doing my bookings in a super efficient way.
As well as the marketing piece and all those super sexy assets that you have. So it must be the dream job for you.
Mehdi: We like to think their assets are super sexy. I dunno if I can use this word anymore, but if it comes from a woman, I think it, it, it, it’s actually better accepted, let’s just say.
Paula: Totally.
Mehdi: Um,but, um, no, been, been serious for a second. I think what you described is actually, um, a funnel strategy, um, a, a consumer funnel strategy, a marketing strategy where you start out with a, a very common need, which is to book a hotel.
Paula: Okay.
Mehdi: And different ways of booking a hotel. You can go through, um, intermediaries, through travel agencies. It may be for business, you may have a TMC and so on and so forth.
But, but we wanted to make sure that as we repackaged the human and and guest relationships through all that, we looked at the booking experience. And so hence we changed not only the loyalty component, but the booking part of our, of our platform to to launch all.com. Um, our, our booking platform the All app.
And then as you go down the funnel, you engage with customers and you reward them for their loyalty in booking hotels by providing them additional recognition, benefits, and of course, experiences. Um, and so it starts off with actually the transactional part, which is I have a travel need.
I need to fight the right brands for my specific travel motivation and budget. How do I do that and how do I get peace of mind? And I take the friction out of the e-commerce component. And then once you have established that relationship, uh, you have, um, created an account, and you are able to establish a personalized dialogue.
Then you established a more deeper, meaningful, more frequent interaction with your consumer. And that becomes loyalty. Loyalty is all about actually being relevant and, and providing for guests needs in anticipation based on data history , but also what we believe it resonates. All right? And, and, and so it, the e-commerce component is the first interaction that we have with consumers.
And when we looked at the brand, ALL Acccor Live Limitless, we launched it as a loyalty program to start off with. And then we worked our way back up and we said, actually, we need to talk about all.com. Because most of the travelers do not necessarily understand loyalty. Only 20% of of travelers internationally, um, hold a loyalty card.
And so you are only talking to a very knowledgeable, knowledgeable crowd. And, and this, this is on past research. And so if you lead, your lead message is talking about loyalty, you may not be actually the catering for potential loyalty members in the future who are currently travelers that are unaware of what a loyalty program can bring.
So, going up the funnel again of their primary need is finding the right hotel, the right hotel experience at the right price, with a frictionless booking journey. Then enables ’em to be fulfilled in their initial travel need and loyalty comes second. So, so that’s why we, we decided, to create, um, a team, uh, and a role that, uh, unfortunately I hold that encompasses both. The booking platform, loyalty and then what we call customer engagement, which is the ongoing relationship with customers through what we call CRM. And so fortunately, I can look after both what the brand stands for, how we attract customers through our booking platform, how we convert them into loyal members, and then how we continually reengage to retain them and satisfy them over time.
Paula: You know, I think there’s an awful lot of people listening to this show, Mehdi, who would learn and do very well to exactly position their loyalty programs like that internally because we’re so proud of them. And, and one of the things I love about the loyalty community is how, um, how much integrity there is.
Actually, and I can hear that coming through in everything you say. Like you really wanna take care of your guests. And when I started in loyalty, that’s what I fell in love with, was this idea that actually I can be loyal to my customers. What a wonderful role to have. But actually, I think when we try and position it as the be all and end all, it can often be seen as a very expensive marketing initiative that doesn’t necessarily connect to revenue and can’t be seen to prove, to drive revenue.
So I think the fact that you have flipped the switch almost and shifted that mindset to go back up to let’s get the basics right, position all as an e-commerce sales channel means from a respect internally and positioning point of view that’s got the absolute fundamentals right. And then you layer everything on top. Am I right with my understanding?
Mehdi: No totally. I mean, for us, uh, I, I, folks that work with me know that I always say loyalty is not a destination. It’s, it’s a customer journey. And at the end of the day, it kicks off with, uh, customers having a travel need that is properly fulfilled because they feel that they’re in the right hands.
You know, people are being taken care of. And it’s a human, it’s in the hu… You know, you, you are basically providing your travel budget in a, to a trusted source. A trusted channel.
Paula: Yeah.
Mehdi: And you want to travel in such a way that you know you’re doing the right thing across the journey. From the moment you book to the moment you arrive, to the moment you depart and come back home, you feel that you’ve made the right choices along the way.
So that’s why I talk about loyalty being a not a destination. You’re not a member. The journey stops. It. It’s, it is just the beginning and it’s an ongoing cycle as well. Um, our, our role is to bring ease, convenience, value, but also surprises along the way so that everywhere as you travel, you’re being looked after, but even in between trips.
You’re reminded of, of, of all, and, and you look at all as not only been a travel platform, and that’s what we tried to do with the Accor Live Limitless, is to provide also experiential opportunities everyday or services that you could actually tap into. Everyday in between two stays. And, uh, it was quite a, um, quite an ambitious, um, positioning and vision to start off with.
And that’s actually what led the whole organization towards, um, providing much more than just a service. It’s a relationship that we’re building at the end of the day. And, uh, and yes, it’s, it’s humid at the heart, obviously we’re in hospitality.
Paula: Yeah.
Mehdi: But it’s also, um, it needs to cater various needs. So there is an element of personalization that goes into the relationship. And especially with technology these days, it’s, it’s becoming increasingly important.
Paula: Absolutely. And technology can enable so many things, but I think, again, you’ve explained it as an ambitious vision. And to me that’s actually, again, for the audience listening to this show, that’s the part you have to actually first of all define, but also maintain with full integrity through to execution and, and I don’t know exactly of course, what it’s like internally with Accor. It’s incredible that you’ve got this team to deliver that. My experience has been that a lot of loyalty professionals might not get the team, might not get the budget. And the ambitious vision that the marketing director or loyalty director has sometimes gets diluted from the time it’s conceived to the time it gets to market.
And if anything, I feel like yours is the opposite. Like I see growth, I see passion, I see ambition, and I see new things coming through all of the time. And I mean world class. So tell us about some of the propositions that you have as part of Live Limitless.
Mehdi: So, so we have, we have a lot and we are very fortunate. And actually having a lot means that your, your first purpose is to be actually clearly heard and being symbol. Um, it, it is when, when you’re in a, an, an industry that is so rich, such just travel, um, you need to take this, the friction out of the experience, but you also need to come across clearly.
So our ambition as we merged both the loyalty, program and the booking platform into one all-encompassing digital platform called ALL was to own the most inspirational booking and loyalty hospitality platform integrating leading hotel brands, experiences, services and rewards, and the emphasis on in integrating leading brands. Experiences, services and rewards is actually the sequence that you would expect from a booking experience all the way to being rewarded.
Um, you start off by making sure that you are, your guest experience is going to be the right one because we have the right brands for you.
Paula: Yeah.
Mehdi: And over the years, Accor developed, um, a number of different, well acquired a lot of companies, and a lot of new brands. And so we needed to come across as been actually a platform, uh, encompassing world-leading brands, um, and Fairmont’s Banyan Tree Movenpick.
Um, were not as, um, uh, Raffles, were not as necessarily associated with Accor at all. And so the first message we needed to get across as we have 40 brands where world leaders in hospitality and in certain markets or certain continents we’re actually industry leading. You take Brazil, you take Australia, you take Europe, you take, um, Middle East, Africa, we, and, and everybody has their own scale, right?
With regards to the number of rooms that we hold and propose, we’re actually industry leaders in those respective regions. And so the first aspect on ALL that we wanted to get across is that, we have a very wide portfolio. We have a hotel that meets your need practically in every destination that you’ll go to.
And that is the first thing that we would wanted to come out with. And then we’d started to develop the loyalty proposition which, which had to, um, which had to encompass a couple of things that we noticed when we ran customer surveys, because there’s one thing that I would say to any loyalty, um, expert or, or younger, uh, professional in the industry.
It all kicks off with customer data and customer insights.
Paula: Yeah.
Mehdi: And before we launched ALL, uh, we spent a year and a half, if not two years, going through globally based on segmentation channel. Um, a number of different, um, we, we, we filled out a number of surveys and we had a lot of information coming back.
And what customers were saying to me, you know, we said to them, what are we, what are you expecting from a new loyalty program that you haven’t had today? And they said to us three very clear things. They said, make my life simple, make my life special, and look after me. And in each of these dimensions, we said, okay, so how, what does this really mean and what are the proof points that we could put behind to justify that we no, when make my life simple was all about making sure that the travel experience was clear, that we have the right brands for you.
That we, um, had the opportunity to provide a simple and reliable program where currency value was actually not opaque, but was completely transparent. Make my life simple was that how much is a point worth? How much am I going to get out of, uh, out of this program if I were to pay, can I pay knowing that I’ve got lost room availability?
And the answer is yes, for, for platinum and above. Do I know that you know how much a point is worth? Well, you know, we have, we have a very clear, uh, system explaining that we’ve got a fixed currency peg based on points, and you know exactly how many points you will need to purchase a room.
Which enables you to actually anticipate, um, whenever you travel if you, if you have enough on a points bank to spend. In most hospitality loyalty programs, you do not know how much your points are worth. And it was, um, something that we wanted to do that would just a differentiator. When we looked at the pillar, make my life simple, we wanted to make sure that we had a euro peg to the points value.
And so, um, when you, when you spend at Accor in a hotel, 2000 points are worth 40 euros. 2000 points, 40 euros, wherever you are in the world. If you want to spend on that, what we call an experience, which is a non-hotel proposition of the program you would basically, you would have 2000 points that are worth 20 euros.
Our points currency is worth more if you spend in a hotel than if you spend outside of a hotel. It’s very simple.So on that first pillar, make my life simple. We design the program and the reward system to be transparent and to be trustworthy. And, and make my life special was all about the experiences, um, and bringing experiences to life.
Where our customers were saying, we need to have, we’d love you to fulfill our passions.
Paula: Of course. Why not? You’re Accor.
Mehdi: Yes, pretty wide. Okay, so how many, how many, how many, how many citizens do we have in the world? And how many passion points do they have? You know, it’s really, really wide.
Paula: Yeah. Yeah.
Mehdi: So really needed to pick our battles and they were saying, you know, we have to universally, there are three passions that really stood out.
Um, one was food, the second was sport, and the last one was entertainment in all of its forms. And so we then we went out to build an experiential platform called Limitless Experiences where we signed, um, leading, leading, um, partnerships with companies such as, um, AG that own that own concert venues and have access to live concerts and tickets.
We signed, um, an international agreement with PSG Paris Saint-Germain, the football club. Once again show providing great access to players and, and VIP events. And, and, and so we, and we went down the, also the food route with um, IMG that run, dunno if you know Paula the taste food festivals. I think you have one in Dubai.
Paula: We sure do.
Mehdi: There go.
Paula: Yes. Yes. Wow.
Mehdi: So we’re partners of that. So we, we then decided to build based on customer insights. Which are the experiences and who are the leading providers of these experiences that we can actually scale and deliver that flawlessly. Um, and the last pillar was make my life, make my life, um, look after me. Apologies.
And so in the look after me segment, we, um, and it was pre Covid which was incredible.
Paula: Wow.
Mehdi: Um, then we, we started to work with an insurer called AXA. And I’m not here to, to basically, uh, position them above anybody else. But we happen to look at AXA as a global insurance provider and we, um, started to integrate, um, not only insurance solutions that you find on any website where you can have additional insurances, and that’s the basics, but we actually incorporated teleconsultation, so medical services that could be accessible in the hotel room as part of the loyalty program. So today in all, if you are platinum and above, you are able to access free of charge in any of our hotel rooms. Actually, 80% of our hotels today, you can access a teleconsultation service in the language of your choice, free of charge if you have a medical issue.
And you will get a prescription that will enable you to go to the local pharmacy to get the medication that you need as you travel. Just one component of the, um, look after me segment and how we translated it into a, uh, a loyalty proof point.
Paula: My goodness. I almost dunno where to start with all of that Mehdi. There’s so much in what you’ve explained, you know, across the, you know, the fundamentals, which we often think about as the hygiene factors. You know, something as basic as take care of me, and as you said, pre-Covid to have that level of foresight. My god, you guys were perfectly positioned with the proposition already coming into that, you know, must have been just an excruciating time, of course, for the whole, uh, Accor group.
So, so I love that you dedicated two years of research in order to really nail what it is the travelers want, because I do think it’s very complicated and very expensive, of course, to build any of these propositions. So to make sure that you take, I suppose, both the member on the journey, but also I know that you have owner operators for most of the Accor hotels, if I’m not mistaken.
So, to be able to convince the 5,300 hotels that I know you guys operate across those 40 brands. Like there’s an incredible amount of evidence and support, and I think resonance in what you’re talking about, and I’m guessing that you almost need to have that level of discipline. With your research, not just to get the marketing campaign to land and to be clear in the way you’ve just explained it to us, but also to bring the whole group and the whole business and every brand at every price point.
Because what did amaze me, and you mentioned a lot of the beautiful brands that Accor obviously, you know, is so proud of, but what I love is, is across all price points. So it might be that I want to go and take the Orient Express, which I know is a brand of the Accor group, but it might be that, actually, no, I just need an IBUs tonight because it’s cheap and cheerful.
So, yeah, I guess the question is, you know, at what point in the journey did you realize that you were going to need that level and depth of customer research in order to build a proposition? Or was it going alongside your own thinking internally when you were developing the the Live limit,Limitless?
Mehdi: It’s a, it’s obviously power. Uh, a combination of both because at the end of the day, um, it starts off with a vision. And the vision being that we wanna stand for much more than just hotels. We, uh, wanted to establish a dialogue with our guests, um, pre-stay and post stay um, have more frequency of interactions and, and getting to know our customers much better so we can service them better.
How do we anticipate service where it’s not only when, when they’re in a, a capsule, um, of couple of days in our hotels, it’s actually how many interactions do you think we can establish outside that will actually nurture the relationship and actually make the core guest experience better. And that’s what we called and, and our CEO, Sebastien Bazin called Augmented Hospitality.
Paula: Yes.
Mehdi: And he said, we need to look at this broader . And so that was the vision. That’s the vision that we started off with, is at Accor, our hotels broader than hotels is what we called Augmented Hospitality. And what do we mean about Augmented Hospitality? It meant looking at a hotel differently as a local, looking at a hotel, not only for travelers, but giving the opportunity to look at the hotel as a service center or a community hub. Where you would go for your local yoga class or you would go to the restaurant. Or you would go because you are able to actually get a cleaning service or uh, you know, for your clothes.
Things like that. And it happens to be the case in Dubai, but in most instances, if you take continental Europe, for example, hotels are really perceived as being fulfilling for traveler needs. And so what we started to do was develop, um, a, a different string of, of, uh, activities and services and, and, and experiences for the community.
And I’ll give you an example, um, and I’ll go back to the to the original question, but IBIS Music was a music program for IBIS, and we organized over a thousand gigs last year in 2022 in IBISes with local artists.
Paula: Okay.
Mehdi: Or, or, or actually established artists. Um, and, and actually accepted that we would turn the lobby into a, a concert hall , uh, for the local community.
Paula: Wow.
Mehdi: Um, it, it’s, it’s, it’s walking the talk at the end of the day. It’s okay. We had a vision, it’s called augmented hospitality. What does it mean? It means you look at a hotel as a community hub and how do you draw people in? We launched a whole music platform called IBIS Music, and that became a reality.
And it’s, and it’s global. It’s a global program. And that, that, that’s the vi… just to, to put the vision into perspective. You know, we, we try to develop this, uh, augmented hospitality field, but then going back to your question on research, it’s not only about the vision, it’s convincing owners that at the, at the tail end of all of this, you are getting a higher return on your investment.
Paula: Yeah.
Mehdi: You’re getting also access to a captive customer base that you would not have been able to get access to. And so we had to prove it with both customer insights and a methodology to the return on investment that they would get over time.
And, and, and we continually now outside of the customer research field, what we call an our ROI, um, calculation per hotel.
Paula: Wow.
Mehdi: Based on loyalty so that they can monitor the new customers that they’ve received or the ROI that they will be getting on the loyalty program. And that’s walking the talk.
At the end of the day, you can’t, you’re not positive in the 5,300 hotels in the world.
Paula: Yeah.
Mehdi: But we have 95% of our hotels worldwide through this methodology that have a positive ROI.
Paula: Oh my goodness. That’s so exciting, Mehdi. Honestly, and, and honestly it was, it was the part I always struggled with when I was running loyalty programs myself, because the attribution can be super challenging.
Now I was in telecoms, which is probably a much more challenging sector, let’s say than a, than hospitality. But I do love that idea that if I was the owner and operator of a hotel, that there is that global expertise. That can be challenged because of course all of those hotel owners are there to make sure that they’re getting value from the Accor brand and to make sure that you’re proving that ROI, I mean it, it must be incredibly rewarding to see those results coming through when you report them back.
Mehdi: Well, for, for us, it gives us great confidence in knowing that we’re on the right path. Um, it obviously, uh, enables a different rapport when you talk to your financial officer.
Paula: Totally.
Mehdi: Um, but it’s, um, because he, we, we, we love him to bits and, uh, I hope he hears me as I speak today.
Paula: Yeah.
Mehdi: Um, but, uh, because we always need more investments. Um, more investments in technology. More investments also because it, it’s becoming an a very challenging space.
Paula: Of course, yeah.
Mehdi: Gaining customer trust is, is something that, um, every brand wants to do. And so we need to make sure that, you know, we are robust on our, on our, our methodologies. In all fairness, Paular today, um, we’re still at the beginning of that journey.
Paula: Okay. Wow.
Mehdi: Um, we had to, we had to establish that our ROI methodology, but we need to also make sure that each of our hotels understands loyalty. And we still early in that journey because it’s an ongoing communication cycle. You need to spend a lot of time our operations on the ground. Um, although we’ve equipped them quote unquote with that methodology, they, they need to continually explain, there’s a lot of explanation that needs to happen. So that the proof points are clearly comprehended and everybody’s speaking about loyalty in, in a united voice. So, , it’s going to still take some time before everybody’s run over, but the good news is the maths don’t lie. And um, and if you’ve got customer satisfaction that is up, the chair is up, that your revenues are up and that you are able to fulfill individual hotel needs. And owners are seeing it individually cuz they always look at loyalty through their own perspective. Course. What’s in it to me?
Paula: Of course. Totally. Yeah.
Mehdi: Then you’re already on the right path. Um, we haven’t figured everything out. But we’d like to think that we’ve got positive momentum internally with our owners and with our, with our customer.
Paula: Well, I can certainly testify to that from an industry perspective, Mehdi. So congratulations on everything you’ve achieved so far.
I know you relaunched the program, I think it was November, 2019, wasn’t it? Literally coming into January, 2020 and we all know what happened. Um, so here we are recording now in March, 2023. It’s almost incredible actually to me that so much time has passed, but I did see then on LinkedIn, the latest news from all and, uh, Live Limitless.
So you are announcing now, uh, the new subscription-based loyalty program or the new tiers that you’re adding in. So I’d love if you would share with us maybe the, the thinking behind adding in a paid proposition to the program.
Mehdi: A bit delighted, Paula. So subscription is you very well. No, because you’re a loyalty expert is something that now is cross-industry. It’s, it’s very common. Um, and it’s, um, it, it’s not only very lucrative for the companies that have launching it, but it’s not an easy undertaking cuz at the end of the day, you need to systematically prove to your customers that the membership and the fees associated to membership are yielding the right value for them individually.
Paula: Sure.
Mehdi: Whereas a loyalty program, you go through the tiers, you get incredibly rewarded and recognize as you go through and your loyalty increases. , but there is no, let’s just say incremental fee associated to it. It’s just shifting behaviors and being more loyal to a brand and, and, but both are connected.
So I like to refer to, um, earned loyalty and paid loyalty. And paid loyalty being the subscription part of the house. And, and Accor is not new to subscription. Um, incredibly, we have, um, been in market since 1996 with a program called Accor Plus. That goes across the whole Asia Pacific region where members would get, uh, a, an accommodation discount free hotel nights based on distressed inventory and an F&B discount across all of the hotels in that region. This Accor Plus now is a side company with an Accor employs 600 people. It now represents in most Asia markets, if a core were to look at how much a core plus generates from a top line perspective versus an OTA, it probably ranks in top line dollar terms close to the number two or number three, OTA A in that market.
Paula: Wow.
Mehdi: So it’s become a powerhouse. And so when we looked at this, you know, this has been growing for over 20 years, and we looked at how customers loved the program, how loyal they were, they were becoming how much our owners would love to see this top line come in.
Um, these customers were the most loyal throughout Covid in Asia Pacific by far. And so we learned from that and then we decided to launch, um, a new, a new program that’s called ALL Plus. So you can obviously see through the branding that it’s connected to loyalty.
Paula: Totally.
Mehdi: Um, so you get an accelerated value, um, in, and, and we have, um, a few products.
So we’ve got all plus IBIS geared towards as, like you said, you, you used it cheap and cheerful. I like that. It’s, it’s, it’s great value hotels that we have where you would get a, um, a discount on your, throughout the year. Um, and it’s the lowest rate that you’ll be able to get both on all.com, on any OTA we guaranteeing this and you would get elevated, uh, also treatment and status as, uh, as an a status boost.
As an outcome as well. And so for all IBIS in the world. Okay. So wherever you trail tree, so it’s alo this one, unlike a core plus, which is only for a regional coverage. ALL plus IBIS. All IBIS is in the world, a standard value proposition based on discount and getting, making sure that you are purchasing at the right value. And this is very, very, very sensitive for SMEs.
Paula: Of course.
Mehdi: And for customers that have dual needs, what we call pleasure needs, they use their, their IBIS all plus card as they travel for business, but they also want to extend into, um, into their personal life as well.
And the second product is called ALL Plus Voyager which encompasses 17 brands from Luxe to Economy. And here once again, you’ve get a, um, 15% discount in, um, eco, mid and premium and you get a 20% discount in the luxe tier all across the year, as well as status boost, um, throughout the year. And this gives you access to 4,000 hotels out of the 5,300 that we hold.
It’s based on rational value because we believe that you need to do the maths on your payback. If you pay for a subscription product, you wanna make sure you get your payback and so on average, well, you, you get a payback on with this particular product after, um, approximately five to six days.
After five to six days you’ll be getting, and this is on average one night per stay. So one could say six nights you get payback. And so, um, if you are a very frequent traveler, this becomes a no-brainer.
Paula: Totally. Well, I mean, honestly, I I, I’ll be dying to see how it performs for you, Mehdi, because the, the amount of, uh, complexity as you said, you know, subscription is often seen as the holy grail and it’s seen as easy money, and I think that that’s a very flawed perception because as you’ve said, consumers are so savvy.
They will do the rational calculations in terms of when does it start making financial sense for me. So to be able to translate that into, for example, if I go and stay for a weekend, an IBIS on my holidays, that’s my, you know, I’m already quids in, as we say, back in Ireland. I dunno if you know that term, but yeah.
And actually there’s another Irish term I’m gonna share with you as well. And we call it being on the pigs back which is… it’s, it’s like being in the best possible position. You’ve totally nailed it.
Mehdi: So it’s not, so when we, so this is not lipstick on a pig, if you use a pig analogy.
Paula: No, no.
Mehdi: This is, this is first… these products are really strong and so I didn’t know…
Paula: Totally.
Mehdi: This, uh, this saying, this Irish thing.
Paula: Yeah.
Mehdi: But I will be using it from now on.
Paula: There you go. So I worked for a company that literally, we built an entire business around, you know, delivering these kind of, again, you know, wonderful propositions that people are thrilled to get to because they can kind of go, okay, I know the deal here and I’ll pay the subscription rate, which I think from your, um, your LinkedIn, I think I saw, is it about 200 dollars in around that price point? Is that, is that fair?
Mehdi: That’s correct. We had that. So the IBIS, um, the O plus IBIS product is 99 Euros. Okay. And the O plus Voyager product is 199 Euros.
Paula: Unbelievable. Yeah. No, and as I said, you know, we’ve had a, a couple of people on this show and working with their own subscription propositions, uh, two varying degrees of success.
And there can be you know, considerable criticism of course, if the proposition isn’t landing. Uh, but it sounds like you’ve done the absolute research through and through and you know, I mean, certainly for me, 200 dollars feels like very good value for what you’re talking about. And I did see things like lake checkout as well, for example, available I think on the Voyager proposition, which is always one that I’m aspiring to.
So super nice idea. So I think with that said, when it comes to subscription, um, what I will be saying is first and foremost, please come back next year and do another interview with us, uh, because I’ll be dying to follow up and find out how it’s performing in market. I’m sure it’ll be evolving over time because of course these things are never fixed.
Um, but I think that’s all of the questions I had for you today, Mehdi. Are there any other burning topics or important things that you think our audience should be, should be hearing about before we wrap up?
Mehdi: Well,um, firstly, thank you again for, for having me on the show. Um, I really appreciate, um, the fact that we have a, um, a podcast dedicated to loyalty.
You talked about loyalty and awards, um, previously, uh, and the reason why pa… Accor is a, is a partner of this particular event, is I believe that we should be continuing to nurture the loyalty community. Um, through knowledge, through expertise. It is, I do believe it is actually absolutely core across a mul, multitude of industries.
And it has, um, evolved, um, over time both on, um, because it’s become a very competitive environment, but also because technology has stepped in, uh, at a completely different level. And, and perhaps that’s what I talk to you about a little bit on, on is our technical journey and our digital journey.
Um, the one that we’ve been on, um, because off the back of what our customers have told us, you know, make my life simple, make my life special, look after me. Technology is at the heart of our value proposition. And, um, we’ve spent the last, um, two years. Um, we, we wanted to do it during Covid, but it was technically too complicated to do so.
But in 21 and 22, we spent the last two years building things that are not visible for the customer.
Paula: Okay.
Mehdi: Which is, um, which is the back of the house, which is often neglected.. Um, around CRM. Um, structuring our data so that we can actually cater for our customer’s needs in ways that they would not see the stitching on the servicing.
The way that our, our data flows from our hotels back to our, our, our data hub and how we’re able to only engage on marketing that will be seen as non intrusive and relevant for customers. That the whole spectrum of, and I don’t wanna use necessarily the technical terms, but you know, CRM, um, the, the customer data platforms that structures your data and, and how we monitor what we call commercial pressure, which is ultimately not going overboard and not over solicitate soliciting customers because, um, they would then dis, unsubscribe and pull away.
And you would’ve actually pushed the relationship too far.
Paula: Yeah.
Mehdi: Um, because it would become intrusive and where, where is that pressure point? based on the customers. All of those things are powered by technology. And today, um, our goal, and we’re still on a journey, is to become incredibly efficient in that space.
Paula: Wow.
Mehdi: To make sure that the customer experience is seen as relevant and never intrusive.
Paula: On those parting words of wisdom, Mehdi, I’m going to say a huge thank you for sharing your words of wisdom on the show today. I trust I will be seeing you in Rio de Janeiro in October this year. Will I?
Mehdi: Oh, of course you have to be at the Fairmont. Uh uh, and in Rio de Janeiro, it, it will be the best event.
Paula: I think I was more excited when they said it was a Fairmont even than when they said it was Rio. So I can’t wait. Wonderful stuff, Mehdi. Um, I’m guessing in terms of, you know, the audience listening to this, there’ll probably be lots of interest and people keen to maybe connect with you.
So would it be fair to say that LinkedIn would be the best place for people to find you?
Mehdi: Absolutely. I try, I try my best to, to answer the questions. I, I do get quite a few, but by, by all means, please do check my LinkedIn account.
Paula: Wonderful. And I’ll make sure to link to your profile on the show notes for this.
So with that said, it’s a huge thank you to Mehdi Hemici, Chief Loyalty and E-commerce Officer for Accor. Thank you so much from Let’s Talk Loyalty.
Mehdi: Thank you, Paula. See you soon.
Paula: This show is brought to you by the Australian Loyalty Association, the leading organization for loyalty professionals in Asia Pacific. Visit their news and content hub for the latest loyalty insights from around the world. Or why not submit your own article for publication, for more information on their loyalty services and networking opportunities, visit australianloyaltyassociation.com.
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