Yahoo Finance Premier Inn Owner Whitbread Wants a Closer Relationship With Corporate Travel Agents
UK-based hospitality company Whitbread has prioritized direct booking channels over any other form of distribution in recent times but is its approach to travel agents about to change?
The Premier Inn-owner gets 97 percent of its UK bookings direct — something other global chains can only dream about — and the number in its nascent German business is even higher at 100 percent – admittedly, it has only three hotels, but it’s a start.
Those sky-high percentages might be on the way down, however, according to CEO Alison Brittain. On an earnings call with analysts on Thursday, Brittain said Whitbread was looking at extending “distribution reach for corporate into channels we haven’t historically paid or played in, which are about bookings where a business consumer has to go through their business travel agent.”
Translation: Whitbread wants corporate travel agents to help fill its beds and perhaps increase its occupancy rate, which stands at 80.8 percent in the UK.
Brittain was quick to quash any suggestion that this would mean a closer relationship with “generic” online travel agents. The company just wants a better way to target business travelers.
“The reason we’re interested in that, is those are bookings we could not get any other way because that business traveler isn’t allowed to book direct. They have to use those channels. So that is a new market opportunity for us and we will look at that and are indeed working on it,” she said.
Whitbread has more than 800 hotels, most of which are in the UK. In recent years it has also expanded into the German market. It operates the Premier Inn brand as well as the Zip and Hub sub-brands and a number of restaurant businesses.
It completed the sale last year of its Costa coffee business to Coca-Cola for $4.9 billion.
Trading Update
European companies aren’t required to publish earnings on a quarterly basis. Some like Whitbread still choose to update the market but just give out a few select metrics.
The key number for hotels is revenue per available room, which in Whitbread’s case fell 3.6 percent on a like-for like basis during its third quarter.
Whitbread’s core UK market remains challenging and despite Boris Johnson’s victory in the December General election has provided some certainty to businesses Brittain said the company remained “cautious on the UK business environment and the impact that that has on hotel demand.”
Whitbread expects to deliver full-year results “in-line with expectations”. Shares in the company were down more than 5 percent in the aftermath of the announcement.
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