Mobile payments

From instant noodles to Alipay; how Marriott hotels are luring Chinese tourists

The US hotel giant says a quarter of its hotels will soon accept Alipay as it taps the huge popularity of mobile payments with mainland Chinese travellers

PUBLISHED : Tuesday, 17 April, 2018, 9:37pm
UPDATED : Wednesday, 18 April, 2018, 2:33am

Competition is fierce between hotel chains to attract mainland Chinese tourists, the most sought-after guests in the global hospitality business.

One of the biggest players in the game, Marriott International, has a loyalty initiative called “Li Yu” offering tailored extras such as instant noodles and Mandarin-speaking staff to make its Chinese guests feel as comfortable as possible.

Now the US hotel giant aims to add another incentive by ensuring Alipay, China’s most widely used mobile payments system, is accepted in almost a quarter of its hotels globally over the next two months.

Marriott said 1,500 of its hotels will be ready to accept Alipay by the end of June as it taps the huge popularity of mobile payments with mainland Chinese travellers. Alipay is already available in 90 per cent of Marriott’s hotels in China, as well as 120 hotels in Asia Pacific.

The additional roll-out means that the payment service will be available at 23 per cent of Marriott’s 6,500 hotels internationally, reflecting the rising clout of tourists from China, the world’s No 1 source of outbound travellers.

Two-thirds of those will be outside Asia Pacific, in the US, Canada, and “high-demand” markets in Europe and the Middle East, according to Peggy Fang Roe, chief sales and marketing officer, Asia Pacific.

The rewards for grabbing a share of the Chinese outbound travel market are potentially huge.

The number of Chinese holidaymakers heading abroad rose by 7 per cent year on year to 130 million in 2017 and their combined expenditure gained 5 per cent to US$115.3 billion, according to the China Tourism Academy.

WeChat, Alipay offer overseas tax refund services to tourists, meaning no more airport queues

Marriott’s wider acceptance of Alipay follows a partnership between the hotel chain and e-commerce powerhouse Alibaba Group Holding formed last year.

In August the two companies said they were teaming up to deliver more personal digital travel services aimed at mainland travellers, including operating the Nasdaq-traded hotel giant’s Chinese-language digital channels. The agreement also included managing Marriott storefronts on Alibaba’s travel services platform, Fliggy, to attract more Chinese tourists.

Roe said the tie-up with Alibaba, which owns the South China Morning Post, does not mean the hotel chain would rule out accepting Tencent Holdings’ popular WeChat Pay, Alipay’s arch rival.

“Although it’s a joint venture between Marriott and Alibaba, its mission is to create a better Chinese customer experience,” she said. “It won’t be just necessarily Alipay.”

Alipay accounted for 54 per cent of China’s mobile payments market in the fourth quarter of 2017, with WeChat Pay in second place on 38 per cent, according to Beijing-based consultancy Analysys International.

Craig Smith, president and managing director of Marriott in Asia-Pacific, said that granting Chinese travellers the option of mobile payments is like installing Visa, Mastercard and American Express credit card payment options to cater to US travellers.

Smith said the hotel chain, which has 29 brands, is aiming to double its revenue and the number of hotels in the region in the next five years.

“We think that’s very achievable,” he said.

He and Roe were in Shanghai to launch an integrated loyalty programme for Ritz-Carlton Rewards, Marriott Rewards and Starwood Preferred Guest members, effective from August.