https://lnkd.in/gcxFyzt9
#EPA: ML #Michelin #Hotel #Guide
Recently, European tire manufacturer and travel guide company Michelin (EPA: ML) announced its hotel ratings in Japan. Michelin Guide evaluates hotels based on five criteria: "Unique Local Experience," "Architecture and Interior Design," "Service Quality and Comfort," "Value for Money," and "Uniqueness." They selected 243 hotels in Japan, with six achieving the prestigious 3 Michelin Key rating. These are considered Japan's most exceptional hotels, offering the highest standards of comfort, service, style, and elegance, deemed as ultimate destinations for a once-in-a-lifetime stay. The six hotels include Gora Kadan in Hakone, Kyoto Mitsui Hotel, Amanemu in Shima, Tokyo Palace Hotel, Tokyo Otemachi Four Seasons, and Tokyo Bulgari Hotel.
Michelin, founded in 1889 by brothers Édouard and André Michelin in Clermont-Ferrand, France, is a tire manufacturer known for the Michelin Guide, which rates and recommends restaurants worldwide. In April 2024, they launched the Michelin Key rating system. In France, 189 hotels were selected, with 24 earning the 3 Michelin Key.
Michelin restaurants are globally recognized dining benchmarks, but Michelin hotels are still establishing their status. Is this purely a non-profit endeavor, or do they have a viable business model? According to company reports, the Michelin Guide generates revenue through four channels: "advertising, brand licensing, gourmet events, and booking services." Haize Capital believes that none of these are easily scalable. To maintain independent evaluations, the first three (advertising, brand licensing, and gourmet events) have limited potential customers and can't accept money from everyone. Booking services require a critical mass to secure competitive prices or unique services from hotels. Currently, Michelin operates as a distributor for Booking (NASDAQ: BKNG) to access inventory, but lacks price competitiveness.
In conclusion, Michelin Guide's revenue is not particularly strong. In 2023, Michelin Group's sales reached €28.3 billion, with non-tire businesses, including the Michelin Guide, growing only 10% YoY. This isn't a standout product line, but it may be necessary to maintain the impartiality and independence of Michelin's ratings.
Reputation is paramount.
Do the right thing
6mo❤️