To begin with, let's take a look back at 2024. How did the year go, marked by the hosting of the Olympic Games in Paris, but also by a lull before the event?
Olivier Cohn - 2024 was a very unusual year, with no regularity or visibility. After a good start to the year, we experienced a drop in activity in April that is hard to explain, followed by another dip in June, with political events adding to the installation of the Olympic Games in Paris. Although the figures were very poor in the capital and the Paris region from early June to 25 July, the summer was generally favourable, with growth of 2% if we look at activity in Paris in June, July and August. Then September was very complicated. We really felt the jolts of the French economy and the political instability. As soon as there is uncertainty, the market becomes tense. Companies are blocking travel or investment, and everything is slowing down. From then on, we expected the end of the year to be in the same vein. But the market turned around a little, with slight growth in November-December. All in all, 2024 leaves us with an unusual taste while growth is on track, with a +1.8% increase in revenue per room despite these monthly and regional disparities.
According to your figures, the seminar market recorded an 8.6% drop in sales generated by your network. Is this due to the effect of the Olympic Games?
O. C. - June, July and September are three big months for seminars, so this has inevitably had an impact on overall performance. Our aim is to develop this market, by training our teams in a different way and by re-launching hotel visits so that our sales staff can get to know them better. So, even though we won new customers thanks to this marketing strategy, there were fewer existing customers last year than in previous years, tThis is certainly due to the Olympic Games, but also to the economic climate. And we didn't feel a shift towards other periods last year, but perhaps there will be these shifts in seminars from one year to the next. When we look at our portfolio for 2025, the outlook is good. Buyers are on a positive trend both in terms of the volume and the average price of their events. This is true both of the MICE market and the corporate segment, where we expect the average price to rise slightly, from around +2% to 3%.
You recently doubled the size of your teams dedicated to the business and MICE markets. How has the corporate segment performed during this rather unusual year?
O. C. - It's a good thing we did it when we did. These dynamics don't happen in a snap of the fingers. It takes time to reach out to companies, sign contracts and then get them producing. But we have already achieved good results in 2024 on the corporate side with a growth rate of 18 % compared with the previous year, for sales of 40 million euros. The return of some business travellers has added to the signing of new international, national and even local contracts. And the outlook for 2025 in this market is also positive.
What is your pricing policy for contracts?
O. C. - Rather than fixed prices, we are increasingly pushing for fixed-price contracts. variable ratewith a percentage reduction compared to the daily tariff. Their share is still very low, at around 3%, but our aim this year is to increase the number of variable-rate contracts to 10%. We believe they are more relevant for everyone, because fixed annual or seasonal tariffs are never really well positioned. When you have the same tariff for three months, some days it may be very good and others not, whether you're talking about hotels or businesses.
So is it a win-win for hotels and businesses, or does one gain a little more than the other?
O. C. - No, no, it's a win-win situation. It's a fundamental trend that we're pushing, as are other hotel groups. We feel that a momentum is building. It may take some time to educate the market, because buyers are not yet used to it. To achieve this, we are taking a few key examples. For example, by showing that the corporate rate is extremely well positioned in the very high seasons, but thatit is finally closed for sale. As a result, bookings go through third-party distributors, with daily rates on which discounts do not apply. When we reposition all this, we see that the company benefits from having flexible prices throughout the year. And for the hotelier, it's much easier to manage, without having to close rates when the season is extremely busy.
In addition to your hotels in France, do these corporate contracts cover the entire Best Western offering worldwide?
O. C. - We have local and national contracts, as well as global ones. When we sign a contract with a company, we are able to offer the group's 3,800 hotelsMany of these are in Europe, with almost 330 establishments in France, 280 in the UK and more than 150 in Germany and Italy. Best Western's national networks work with each other to promote the brand and optimise our organisation as much as possible, by supporting each other on the contracts that each can sign. For example, if Ikea is managed by a Swedish salesperson, he or she will do the sourcing work to find the right hotels in France, Germany, Italy or the United States with his or her colleagues, so that they can be included in the hotel programme.
Let's get back to the French network. How do you see the year 2025?
O. C. - The start of the year is complicated, with very slight growth in January and a slight fall in February. March does not look very good, and will certainly be down on last year, while the portfolio for April looks fairly good. Looking ahead to the year, the first half should be lacklustreIn the second half of the year, demand will be somewhat sluggish, before a possible slight rebound. With corporate defaults at very high levels, a European economy that is not exactly flourishing, and a rise in unemployment that could weigh on consumption and leisure spending, our forecasts are as follows downward trend for the year 2025. A fall of around -2% to -3%. The research firms' analyses are more positive than we are, but for the moment we don't think we're wrong.
All the more so as geopolitics may come into play to disrupt the year...
O. C. - Developments have been particularly rapid recently. Our sector is extremely sensitive to geopolitics and the economy. An announcement from Donald Trump can make or break things. Higher taxes, if there is an economic slowdown, will have an impact on business travel. On the other hand, what direction will the euro-dollar parity, which until recently has tended to favour us, take? It's hard to sayBut this could have a negative impact on the summer season for American customers. Faced with all these uncertainties, we have decided to put the network on alert for what promises to be a more complicated year.
However, because of the size of your network in France and your coverage of the country, you can also count on a domestic customer base.
O. C. - We have worked hard over the last 20 years to smooth out our customer sources and be less affected by cyclical events. Americans accounted for just 4% of customers last year, compared with 40% 15 years ago. Conversely, French domestic customers accounted for 67%. Having a higher proportion of French customers, and corporate customers in particular, enables us to be more resilient.
This development is also due to the growth of your offering in France. Let's talk about this growth. How many hotels did you open last year?
O. C. - We opened 20 facilities last year, bringing the total to 323 hotels. And we should do even better in 2025, with 25 or even 28 branches. The trend in terms of both openings and approvals is very good, while the number of outlets leaving the network is low. This can be explained by a high brand awarenessBest Western ranks second in the market behind the Accor group. Our distribution strength is well established, and we are also renowned for our proximity to the network and our ability to respond to hoteliers' problems. What's more, because of the cooperative nature of the group, our membership costs are lower than those of a number of major chains. Which may explain this dynamic. If you look at the groups that have grown the most in France over the last five years, there's B&B Hotels, which has experienced incredible growth. Accor must be at 3%, and Marriott and IHG have also expanded. And we must be growing at around 6%.
To go into more detail, how is this offering evolving across your different brands?
O. C. - Our economic brand Sure continues to do very well, accounting for 30% of signatures. Best Western Plus is also developing well. However, Best Western remains our blue chip, accounting for half of our network. When we look at the breakdown of our network, we have just over 10% of the portfolio - or 40 hotels - in the economy segment and just as many upmarket establishments through Best Western Premier and Premier Collection or Worldhotels. And, in the middle, we have more than 200 Best Western and Best Western Plus establishments in our traditional market, the classic or superior mid-range.
In France, as everywhere else in the world, hotel development is being driven by conversion brands, which are conducive to changes in brand names as well as the arrival of independent hotels. Are your brands adapted to this model?
O. C. - Whether Best Western, Best Western Plus or Sure, all these brands are in fact well positioned on conversion, unlike another of our banners, Ayden, which focuses on construction. This is a market that has been at a standstill since Covid, then inflation and the hyper-growth in the cost of materials, but which is starting to pick up again. This is typically a brand that will return to growth in one or two years' time.
What about the development of the top-of-the-range WorldHotels brand, which will be acquired by Best Western in 2019? Do you have any plans for France?
O. C. - It fits in perfectly with our roadmap, with a target of three signings set for this year. This top-of-the-range brand is a real addition to our portfolio. The higher you go in terms of price, the more the Best Western brand shows its limitations, because our history is in the mid-range. WorldHotels allows us to take over at the top end of the market, where the Best Western brand could be weakening.
Two final questions about your hotel portfolio. Firstly, how far have you got with the roll-out of your MyWo coworking offer?
O. C. - We've finished rolling out the entire network with this coworking offer divided into three packages, one free of charge, another paying and the last focusing on the last-minute meeting room hire. For example, if a hotel has not rented out its rooms, it can put them on MyWo for the last two days. If a customer is looking for a workspace for a small meeting with two colleagues or a recruitment interview, rather than taking a seat at €5, they will take the room if it has an attractive rate.
And finally, one of the big issues of the moment, CSR. Best Western is one of the top performers when it comes to certifying its hotels. Where do you stand today?
O. C. - 70% of our fleet now has the Green Key label, a real success, given that we had set ourselves the target of 75% by the end of 2025. Since then, we have raised this target to 85% by the end of 2025This is 10 points more than planned. This commitment is in line with Best Western's ambition to reach 100% certified hotels worldwide by the end of 2026. It's a big commitment, but I think we'll get there, even in Asia and the United States, which are not the most advanced destinations in this respect.
