Accor’s Leire Leoz on Why Franchise Growth Has to Be Earned

This sponsored content was created in collaboration with a Skift partner. For hotel owners, growth in demand does not necessarily translate into stronger returns. Skift Research has found that profitability, rather than demand, is now the key metric investors are watching in the U.S. hotel sector, as rising labor costs and inflation continue to put pressure on margins. That environment is raising expectations for what hotel brands and franchise platforms actually deliver at the property level. Accor is relying more heavily on franchising to drive growth. Franchise agreements now account for 80% of deal signings across its premium, midscale, and economy division, and the share of franchised hotels across Accor’s global network has risen steadily in recent years. For trusted investors and partners, the company is also expanding its approach to include more opportunities to franchise among some of its luxury and lifestyle brands. In February, Accor appointed Leire Leoz as global chief franchise officer for premium, midscale, and economy. Skift Studio spoke with her about why she believes owner trust has to be earned through performance, how Accor is simplifying its franchise platform, where conversions and regional expansion fit into the growth strategy, and why one of the clearest signs of success may be whether existing owners choose Accor again. Leire Leoz, Global Chief Franchise Officer for Premium, Midscale, and Economy, Accor Skift Studio: You joined Accor as it was accelerating its franchise strategy. What priorities emerged as you started shaping the roadmap? Leire Leoz: I spent my first couple of months listening to and understanding the Accor ecosystem, its brands, and its people. Three priorities emerged from that: performance, brand integrity, and simplification. Performance comes first because I want to make this an owner-centric organization. I tend to say that choice and trust are earned, and we earn that trust by delivering greater performance for owners. That means focusing not just on revenue, but on profitable revenue. The second pillar is brand integrity. We have some room to improve the consistency with which we protect our brands, and that matters to owners as much as it does to us. The third is simplification. We’re streamlining our service offering to focus on the tools and services that can have the greatest impact on hotel performance and brand integrity. It’s about focusing on what matters most. “Owner-centric” is used frequently across hospitality. What does it mean in practice for Accor franchisees? It starts with listening. Our regional and local teams already have strong relationships with owners, so the goal is not to replace that. It’s to make the dialogue more structured and make sure we have a clearer view of what owners are prioritizing across markets. We’re creating more two-way discussions through things like our Global Franchise Advisory Board and an annual owners survey. That helps us bring owner feedback into the organization more consistently, while preserving the local relationships and market knowledge that are already very strong. Owners want the distribution, loyalty, technology, and scale of a global brand, but they also want control over their businesses. How do you balance those interests? You have to start with the right partner and aligned expectations. Even before signing, we need to understand the owner’s ambition and be clear about whether we can create the value they expect. Sometimes that means being humble enough to say a brand may not deliver the premium an owner expects in a certain market. Putting a brand on a hotel has a cost, so we have to be confident we can improve performance. It is not about signing more hotels for the sake of it. We want to sign good deals, where we can improve the performance and value of the asset, earn the owner’s trust, and ideally create the foundation for future investment with that partner. We also have to keep the owner’s bottom line in mind, even if the franchisor naturally has more visibility into top-line performance. In today’s operating environment, where do owners most need added value from a brand partner? AI is a major opportunity. We’re already looking at how these tools can create significant, quantifiable productivity gains at the hotel level. But we cannot let that distract us from the fundamentals, especially loyalty and distribution, which remain key drivers of performance. We need to keep improving how we bring guests through our own channels and how our ALL Accor booking platform and loyalty program create value for hotels. I’ve been impressed by how Accor is expanding ALL Accor through partnerships, including the recent collaboration with Uber. Across fragmented markets, we have to find different ways to create reach and value. You’ve also created what you call the Global Franchise Center of Excellence. What is its role, and how will it support owners across different markets? Accor’s Global Franchise Center of Excellence is a central team focused on strengthening how we support franchise operations across regions. It is not there to centralize hotel support or replace local relationships. The regions need to own those relationships because they understand their markets. The Center of Excellence is there to strengthen the platform behind them by sharing best practices, offering more consistent tools, tracking performance more consistently, and helping protect brand integrity globally. That matters more as our partners themselves become increasingly global. Conversions are becoming a larger part of hotel growth. What makes a conversion worth pursuing? Conversions can be a fast way to grow, but the economics should come before the flag. We need the right partner, the right brand, the right asset, and the ability to create incremental value for the owner. Speed matters, but not at the expense of long-term performance. I would rather take a little longer and make sure a hotel opens under our flag ready to perform from day one. The goal is not simply net unit growth. It is to build a healthy network with owners who see value in staying with us. Does the franchise opportunity look different across premium, midscale, and economy versus luxury and lifestyle? Premium, midscale, and economy are naturally highly scalable. The brands and operating concepts across these categories tend to be simpler, which makes franchising a more straightforward fit. Luxury and lifestyle segments require a more selective approach. The service model is more complex, food and beverage can be more elaborate, guest expectations are higher, and the operator needs greater sophistication. So we have to be more selective about both the brands and the partners we consider, as well as how we approach those agreements. At the same time, more luxury brands are opening up to franchising and actively doing those deals, so we do not want to be left out of that opportunity. The door is open, but the way we screen and onboard partners has to reflect the additional complexity of operating in those segments. Where do you see the strongest geographic runway for franchise growth? Europe is already a mature franchise market. Looking ahead, I see the Middle East and Africa as particularly strong opportunities. In the Middle East, we are seeing experienced operators bring franchise expertise into the market. Africa also has enormous potential. Branded penetration can grow quickly because travelers often value the added comfort and trust a global brand can provide. In many of those markets, franchise will likely enable that growth. What are some examples of how that franchise growth is already taking shape across different markets? We’re seeing strong momentum across a number of regions, along with growing diversification in the types of hotels operating under franchise agreements. While franchising at Accor has historically been more prevalent in the economy segment, we are now seeing this model expand across all segments, as illustrated by recent franchise signings, including Sofitel Fiji, MGallery Rhodes, MGallery Chengdu Financial City, Pullman Panama City, Pullman New Capital Cairo, Swissôtel Santo Domingo, and Mövenpick Pera Istanbul. In the Americas, Treasure Island in Las Vegas joined Accor under a franchise agreement and, with 2,884 rooms, became the largest hotel in our global network. We’re also seeing growth through collection brands and third-party operators in markets across Southeast Asia, Australia, Europe, and North Africa. What is important is that the model can flex by market. The opportunity may look different from one region to another, but the goal is the same: work with the right partners, bring the right brand to the asset, and make sure we can create value for the owner. More than half of Accor’s existing franchisees own multiple hotels in the network. What does repeat investment tell you? For me, it is one of the most important measures of success. Owners have plenty of brands to choose from, so being chosen as a franchise partner is something we have to earn. Earning their trust to the point that they choose to stay with us and invest again is even more meaningful. That is why owner satisfaction and repeat investment are key metrics for me. I also want Accor to use a more balanced scorecard that looks at hotel performance and brand health alongside financial measures. Owner satisfaction is not about entertaining owners. It is about earning trust through performance. Accor has tangible advantages there. Loyalty and distribution are part of it, but so are ESG and procurement. Our procurement platform can give owners access to competitive pricing and a broad range of products and services they would struggle to access independently. Those capabilities matter because they can affect both sides of the hotel P&L. Ultimately, protecting the brand and improving owner performance go hand in hand. If owners trust that we will deliver value and protect the flag they invested in, that creates the foundation for sustainable franchise growth. For more on franchising and development opportunities with Accor, click here. This sponsored content was created collaboratively by Accor and Skift Studio.