Marriott did not take the plunge into alternative accommodations (Marriott Homes & Villas) for immediate financial gains, but the move is a key new piece of its strategy to keep its customer base engaged and loyal.
According to Skift, Marriott’s chief financial officer Kathleen Kelly Oberg said the amount of money it is investing in its new Homes & Villas website, and any profits it expects aren’t material to the chain’s financial results.
“On the financial impact, both from an investment standpoint as well from a profitability standpoint, it’s really de minimis,” Oberg said.
“Hopefully over time, it’ll be something that will be kind of worth pointing out a number to. But for the near term, I wouldn’t expect it to be anything meaningful at all.”
But that doesn’t mean that the venture, in which Marriott acts like a third-party online travel company and offers inventory from property managers, isn’t an important component in the company’s strategy.
Although property managers handle the bookings and provide customer support through Homes & Villas, the platform can be seen as an extension of Marriott’s direct-booking strategy because vacation rental customers can book, earn and redeem Marriott Bonvoy points, the group’s loyalty program, and is a way to keep customers within the Marriott ecosystem.
With Homes & Villas, Bonvoy members earn five points per dollar spent, and can redeem at a rate of 143 points per dollar.
“We felt that it was really important for our consumer to be able to add that to their range of choices, when they’re out staying in all of our hotels and earning lots of points,” Oberg said.
"It’s clear from our experience last year that from the [homesharing] project , that Bonvoy members responded really well and found it as a rewarding way to use their points.”