The Marriott hotel giant is looking to return to Argentina this year with its iconic brand

For two years and after the purchase of Starwood, Marriott is the largest hotel company in the world. It has 6,900 establishments, 30 brands and a presence in 130 countries. The giant manages 11 hotels in the country and has plans for Argentina: it would return with its flagship brand, the Marriott, in the short term. Six years ago, he left the country when the Plaza Hotel was sold and returned after the global purchase added the iconic Sheraton brand.

"We're the best. If you take the market capitalization of Marriott, it will cost you 41 billion USD. This is our "price". The other three chains that follow, they add, have almost the same value, "he said. Infobae Federico Greppi, Chief Financial Officer of Marriott International for Latin America and the Caribbean. Greppi spent 13 years at Starwood and before that at Arthur Andersen. He is a director and an accountant and holds an MBA from London Business School.

– How would you describe the local hotel industry in this crisis context?

– I see the context with positive eyes. In Argentina, tourism accounts for 10% of GDP. This is a high number. Hospitality, in addition to being a source of income, is an industry of people who employs many people. Marriott in Latin America has 54,000 rooms in 250 hotels and employs 45,000 people. It's 0.8, 1 and up to 1.5 employees per piece.

– This year has not started well in general either.

– After the devaluation, we see a lot of income from customers from neighboring countries. Last year, there were a lot of tourists from Argentina to shopping in Chile and we now see the opposite.

– What is the brand's strategy at the local level?

– We have 11 hotels in Argentina and eight are Sheraton, a very important brand in the country. At the local level, we are trying to grow with other brands oriented towards thousand or luxury, for example. Our St. Regis brand has a butler who helps the pbadenger bademble and dismantle the bag. Many will not be affected, but there is a cluster niche customers who need it. We have mid-high to luxury brands, we develop them. The most important market in Argentina is the market top of the line, medium-high, with Sheraton. We could enter with other brands, we see the return potential of the Marriott brand or JW brand. We work with developers.

– The idea is to find the Marriott brand in the short term?

– Yes, in the short and medium term, it could come back. The economies of the region are very volatile and they are real estate developments that need to be reviewed for at least three years. These are 20 year projects and get lost in the specific volatility of a year or in a devaluation, this can lead you to make a decision that is not correct. We are thinking of long-term projects, with the ultimate goal of staying in the country for the next decades.

– But the idea is to land with new brands in the country?

– Yes, of course, we want to give the 125 million members of our loyalty program the opportunity to be elected. It depends on whether there is a new build or a conversion, we discuss with the developers for both modalities. I think announcements of new brands could be announced before the end of the year if negotiations progress. The conversion is fast and the construction takes about 18 or 24 months.

– Why do not they own hotels?

– The hotel industry has migrated a lot. Historically, companies owned hotels. In the late 1980s, they focused on the administration, and by the end of the 1990s, the focus was on franchising. Marriott operates in all three models with very few clean hotels, especially those that have inherited the purchase of Starwood, which sells them little by little. The market, especially the US market, is very sophisticated and the investor diversifies his risk: if he wants real estate, he buys shares in a trust. Anyone who invests in Marriott is interested in the hotel management business.

– What is the percentage today at the local level?

– 70% of administration and 30% of franchise. We got rid of everything that was Starwood; we intend to sell part of the Sheraton Libertador.

– The Marriott brand is competing with Sheraton, is not that a cannibalization?

– They are historical competitors who are now under the same umbrella. But even if it does not look like them, they focus on very different niches. We find that the local developer market has a strong interest in using both brands, with economies of scale to manage different hotels in the same city.

– What do you think was the main problem, besides the economic one, which added the merger with Starwood?

– I would say two. Worldwide scale. Marriott has added 1,500 hotels. This allowed him to leave the United States a little more and to have a footprint more distributed with a greater position in Asia. It has doubled the position of Latin America, we have 250 hotels in 33 countries with 19 brands. The second point is the loyalty program, which we completed in February, has more than 125 million members. This is called Bonvoy and it's the fusion of Starwood, Marriott and Ritz Carlton programs.

– In addition to the fidelity, what do these loyalty systems offer?

– These programs provide a better connection with customers, but also minimize booking costs. With the OTA, travel agency online, like Expedia and others, a commission is paid that does not exist with these programs because they are internal channels.

– What is the weight of these types of programs in the company in particular?

– More than 30%. And the challenge is that it grows with global marketing tools.

– What is the share of business of the company in the United States?

– 60 percent. It is a sophisticated and mature market. Latin America accounts for 8% of total revenues.

– How do you think companies such as Airbnb have had an impact on the hotel industry?

– Last year we launched Tribute, our brand of portfolio of flats: Selected and decorated apartments, with Marriott's security standards and loyalty plans. He has done very well and has not responded to the demand of our London hotels. The model already exists in three cities in Europe and it is planned to bring it to the region, but I can not give you more details.

– There may be complementarity, but they have not had any customers?

– the sharing the house This is complementary to the hotel industry. They usually focus on targets different This is a new industry and captured the curiosity of the sector. We strongly insist and always demand equal rules for all. In the hotel sector, accommodation taxes are paid and subject to inspections. There are regulations that these companies sharing the house They do not have any and they will come. It has arrived in San Francisco, New York has tried and other cities are going from the front. We compete or complement one another.

– What are the drivers of the hotel and tourism industry in the years to come?

– There will be a lot of technology. Many applications online and. Also new segmentations and specific brands. In addition, there must be a catalyst, and that is the consolidation. In the hotel industry, there are no players with more than 10% of share.

– This concentration is not negative?

– Reduce operating costs and generate more affordable prices. In addition, businesses travel to locations that do not have unified platforms, both reservations and loyalty programs. It's positive