Why Marriott Is Moving into All-Inclusive, and What’s Next
Marriott sent shock waves through the travel industry over the summer when the world’s biggest hotel company announced a full-fledged foray into the fast-expanding, increasingly competitive all-inclusive sector.
It was not a surprise, then, that the company said its first global all-inclusive destinations would be in the Dominican Republic and Mexico, the region’s two biggest all-inclusive superpowers.
Then. in October, Marriott announced the planned purchase of Barbados’ Elegant Hotels, a collection of boutique, mostly all-inclusive properties, signifying that its all-inclusive push would not be mere lip service.
Finally, last month, the company announced two more all-inclusive destinations: Jamaica and Curacao.
Plainly, Marriott is entering all-inclusive in a big way, and it’s going directly at several other hotel brands that have similarly deepened their all-inclusive portfolios in recent years like Hilton and, through the Playa company, Hyatt.
So what’s next for Marriott in its all-inclusive plan? And why enter the crowded market?
To learn more, Caribbean Journal talked to Alex Fiz, VP & Managing Director of All-Inclusive for Marriott International Caribbean & Latin America about the company’s thinking and its all-inclusive future.
Why is Marriott making a push into the all-inclusive sector?
Marriott continuously strives to offer our members and customers – as well as our development partners – new travel choices around the world and see the all-inclusive segment as getting ready to grow exponentially.
This trend is due to the ever more hectic lifestyles of the consumer and guests are seeking convenience and hassle-free vacations to truly relax and take a break from being constantly on.
We know that our stakeholders – members, customers and owners/developers – trust our brands, so we think this on its own will help differentiate a market that is currently fragmented.
What trends are you seeing in that regard in the broader industry?
Travel is shifting with Gen Z coming of age, travelers valuing experiences over “things” and being more and more crunched for time. As a travel company we have to adapt and continue to cater to our guests wishes.
We have been watching the all-inclusive industry for years, and see it truly evolving. Our research also shows that our 137 million Marriott Bonvoy members want in on all-inclusive.
“Travel is shifting with Gen Z coming of age, travelers valuing experiences over ‘things’ and being more and more crunched for time.”
Another interesting point to note is that the segment has been increasingly been going upscale – with high quality food, drink, experiences and accommodations. That positions Marriott – with our Premium and Lluxury brands – very well to capture market share.
What motivated the Elegant Hotels acquisition?
The addition of the Elegant Hotels portfolio will help us further jumpstart our expansion in the all-inclusive space, while providing more choices on the breathtaking island of Barbados for our Marriott Bonvoy members.
We expect that, following the acquisition, the Elegant hotels could derive a number of benefits from being part of the Marriott group, including revenue and cost synergies driven by Marriott’s distribution structure and contracts, access to Marriott’s strong consumer brand and award-winning travel program, Marriott Bonvoy, access to capital required for accretive capital expenditure, as well as additional cost synergies driven by Marriott’s purchasing power.
Can you talk about what traits you see in Barbados as a destination, particularly as your first all-inclusive destination?
Barbados is a popular leisure Caribbean market and Marriott did not have beachfront leisure properties in this beautiful part of the world up to now.
With the addition of the Elegant hotels, along with our current offerings in locations such as the Bahamas, Jamaica, Aruba, Puerto Rico and Grand Cayman – just to name a few – the hotels in Barbados provide us with more choices to offer our guests no matter their reason for travel.
What is the timeline for Marriott to rebrand Elegant’s portfolio?
We initially plan to continue to operate the hotels under their existing branding. Upon completion of planned property renovations, we expect to convert the remaining hotels to an all-inclusive operating model under one or more of the company’s Collection brands.
What is your outlook for all-inclusive going forward? Will it only continue to grow?
Since Marriott has launched its all-inclusive platform to hotel developers, owners and franchisees worldwide, the company has working contracts with seven all-inclusive resorts comprising more than 3,700 rooms across four countries. The combination of our leading support platforms (including Marriott Bonvoy membership base), our global scale and our operational expertise allows us to tap into this fast-growing segment of the vacation lodging industry.
With 7 Marriott International brands (Marriott Hotels, Westin, W Hotels, The Ritz-Carlton, Delta, The Luxury Collection and Autograph Collection) currently in the pipeline for all-inclusive, we have effectively differentiated their distinct offerings based on brand pillars, which promote brand loyalty and allow us to continue enhancing the guest experience.
We also know that all-inclusive segment is tremendously appealing to business groups, families who are gathering for special occasions and destination weddings. We are listening to our guests and they are the ones driving the evolution of the all-inclusive industry.
Do you have any concrete plans for other destinations in the Caribbean?
We currently have the following projects signed and approved in the Caribbean:
- Dominican Republic – A 650-room Autograph Collection is expected to open in 2022.
- Curacao – a 283-room Autograph Collection resort expected to open in 2024. This hotel is the first contract for a Marriott franchised all-inclusive resort.
- Jamaica – a 800-room Marriott All Inclusive hotel
Marriott is also planning all-inclusives in Curacao and Jamaica. Can you talk more about those plans?
The 800-room Marriott Hotel AI Amaterra in Jamaica and the 283-room all-inclusive Autograph Collection resort in Curacao were signed and announced recently and we are excited to have these new-build projects start construction very soon. We expect them to come online in 2024 and 2022 respectively.
Do you foresee converting any existing Marriotts in the Caribbean into all-inclusives?
We are continuously evaluating opportunities for conversions – that includes Marriott Hotel properties or non-Marriott International assets.
When Marriott first announced its all-inclusive push over the summer, Mexico and Punta Cana were the first planned entry points. Those have traditionally been the region’s powerhouse markets for all-inclusive resorts. What makes them such popular destinations for all-inclusive investment?
Mexico and Punta Cana have traditionally been hot spots for all-inclusive vacationers, given the beautiful destinations, lovely beaches and relative ease to get there. Conditions to build all-inclusive properties in these locations were mostly likely favorable from an investor point of view so that resorts came up one after the other.
The post Why Marriott Is Moving into All-Inclusive, and What’s Next appeared first on Caribbean Journal.
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