Chefs+Tech: New Updates Make Facebook Messenger a Sweet Spot for Restaurants

Skift Take: Facebook Messenger’s newest additions enable restaurant discovery, reservations, and delivery, which begs the question: if you can get your food on Facebook, do you ever need to leave Facebook?

— Kristen Hawley

chefslogo_use-for-socialEditor’s Note: In September we announced that Skift was expanding into food and drink with the addition of the Chefs+Tech weekly newsletter.

We see this as a natural expansion of the Skift umbrella, bringing the big picture view on the future of dining out, being fanatically focused on the guest experience, and at the intersection of marketing and tech.

Recommendations, Chatbots, and OpenTable in Facebook Messenger

At its F8 conference Tuesday, Facebook announced several business-focused updates to its Messenger app. Facebook estimates 48 million businesses have enabled Messenger to communicate directly with new, potential, and existing customers. New Messenger functionality announced at F8 includes a directory, spotlighting popular and local businesses, bots, and, of course, restaurants.

I consider the terms “bot” or even “chatbot” a little off-putting; they sound way too techy and not nearly hospitable enough for the hospitality industry. Instead, think: businesses can automate certain conversations — location, hours, directions, menu information — and simulate a human conversation, increasing engagement and, presumably, customer satisfaction. Last September, Pizza Hut and TGI Friday’s got in on the bot action; expect a lot more restaurants to jump on this soon. As we noted in September, bot functionality starts off a bit limited (in this case, information about hours and specials.) But because users are asking these bots questions, companies can quickly see exactly what consumers are looking for and program that specific functionality, making the chatbot a lot smarter and more useful. Restaurants and other businesses can also enable a feature called Smart Replies, which Engadget calls “a way to enable automated answers to frequently asked questions.”

Also included in the announcement: the ability to chat with a group and a bot. Most notably, users can make restaurant reservations directly in Facebook Messenger using a new OpenTable bot without leaving a Messenger conversation or launching a separate app. Coming soon: smart integration with delivery.com, including recommendations, ensuring we can continue to get exactly what we want exactly when we want it, now with fewer clicks.

No One Talks About the Real Food Business

Food and restaurants are having an inarguable moment, with more attention and excitement around the space every day. Understandably, we get caught up in the glamour and excitement of new restaurant openings, big-name chefs, food television, must-eat lists, and restaurant recommendations from every corner of the planet. Less talked about is the actual economics behind the business — i.e., how do these businesses stay in business amid financial challenges and legal regulations and red tape?

To understand the industry is to understand all its workings, and three recent stories paint an interesting picture of the business today. The Boston Globe has a piece explaining how chef-owners actually make a living in Boston (it’s tough.) The New York Times profiles a day in the life of a street food vendor, from wake up to food sourcing to recipes to pricing strategy. And a news story out of Bangkok reports a major change to tourism in the city as city officials crack down on street food; those famous sidewalk stalls had to pack up their tables and cease operations by April 17. (Mobile food carts are still allowed in certain locations.)

All three stories do a good job of reflecting the food-culture ties we’ve become so familiar with, but also detail the serious challenges and impediments associated with running these businesses. Food cart licenses in New York are hard to come by and sold at a crazy markup (the profiled vendor paid $25,000 to take over a license that cost the original holder just $200). In Boston, occupancy costs for restaurants in prime locations can run tens of thousands of dollars a month, and that’s before shelling out for food, labor, decor, utilities, and, maybe, hopefully paying yourself a salary as a chef-owner. And in Bangkok, the food vendor crackdown is literally robbing the city of a part of its soul (and some real tourist cash, too). All three pieces are worth a read to understand a little more about the businesses that have become cultural centerpieces.

 

Snapchat’s Latest Ad Product Is Good for Business

As stakes increase and competitions stiffens for advertising dollars on social media, Snapchat is set to offer retailers data about whether or not an ad campaign actually drives users to a physical location. Snapchat has been testing the product, called Snap to Store, since last year, according to the Wall Street Journal.

It works like this: restaurants (or any business, really) purchase a sponsored geofilter (one of those image overlays snapchat has become known for). A person in the restaurant uses that geofilter, posting a story or sending a snap to friends. Then, the app tracks friends who saw the geofilter and visited the restaurant — and it also tracks friends who didn’t see the geofilter and visited the restaurant. Put those statistics side-by-side, and the advertiser gets a picture of the ad’s effectiveness. It’s worth noting Snapchat isn’t tracking your location unless the app is open — but users open the app an average of 18 times daily, so it’s a bet a lot of restaurant chains would likely consider strong. It’s especially strong when you consider 80 percent of Snapchat users open the app while at a restaurant. (Wendy’s tested this functionality last year, and found one sponsored geofilter drove 42,000 people to a Wendy’s location within seven days. Solid.)

 

Unhealthy Obsessions on Social Media

In case you need something else to worry about, according to the National Osteoporosis Society, “clean eating trends” that have gained popularity thanks to social media might be causing serious problems for young people. The problem: these often restrictive diets eliminate major food groups, setting the stage for future health issues. When people see these fad diets touted on social media, they often join in without seeking expert facts or advice. This isn’t a brand new problem, according to Food & Wine, but it is a tech-driven problem: health bloggers and other non-accredited health websites extol potentially unhealthy fad diets and detoxes that can do real damage.

Digestifs

  • Kimbal Musk, brother of Elon, redefines farming with technology in Brooklyn — Backchannel
  • A look (finally!) at Made Nice, the new fast-casual spot from the team behind the world’s best restaurant — Eater
  • Whole Foods may have mainstreamed “organic,” but when it comes to purchasing, customers always prefer the cheaper option — Quartz
  • One group is aiming to make Chicago the “Silicon Valley” of the food industry — Chicago Tribune
  • A new ratings system measures restaurant sustainability — FoodTank

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Acquisitions Add to AccorHotels’ Strong First Quarter Revenues

Travel Keys

AccorHotels plans to complete its acquisition of private vacation rental broker Travel Keys by the end of this month. Shown here is Turtle House from Travel Keys. Travel Keys

Skift Take: Honestly, we’re just wondering what’s on their list of things to buy up next.

— Deanna Ting

Fueled by several strategic investments and acquisitions from last year, including the $2.7-billion purchase of Fairmont Raffles Hotels International (FRHI), AccorHotels is “off on a good start” in 2017.

That was the message from AccorHotels chief financial officer Jean-Jacques Morin while reporting the Paris-based company’s first quarter revenue.

AccorHotels’ consolidated revenue for the first quarter was $456 million (€425 million), up 35.4 percent from the same period last year. Of that total, new acquisitions and disposals of businesses added $88 million (€82 million) to the company’s revenues, thanks in large part to the addition of Raffles, Fairmont, Swissotel, Onefinestay, and John Paul, a concierge service provider.

The quarter also marked the first time in two years that the company has had such a strong growth, 5 percent, in revenue per available room (RevPAR). Morin attributed much of that growth to occupancy driven by leisure travel, especially in the European and Asia Pacific regions.

The company also added more than 7,000 rooms spread out across 35 hotels globally during the first quarter.

In a press release, CEO Sebastien Bazin said: “The trends observed in the first quarter in the vast majority of regions reflect a favorable environment for the hotel industry. This is particularly the case in our three main markets, France, Europe and the Asia-Pacific region. The new businesses also performed well, thanks in part to the support of AccorHotels.

“At the same time, the Group further entrenched its growth, its move into new businesses and its leadership in the luxury segment through numerous value-creating acquisitions, namely Rixos and BHG in hotels, and Availpro, Potel & Chabot and VeryChic in new businesses. Lastly, the process of transforming AccorInvest into a subsidiary is underway; AccorHotels is therefore perfectly in line with our 2017 objectives.”

A Highly Acquisitive Company

While Morin focused on details of AccorHotels’ financial health during the earnings call with investors, he also touched on future plans for the highly acquisitive company, which has big plans for becoming a much more comprehensive and diverse hotel company than its peers.

For example, AccorHotels’ planned acquisition of Travel Keys is expected to close by the end of this month. The addition of the Atlanta-based private vacation rental broker will round out AccorHotels’ already fairly robust portfolio of alternative accommodations, which includes platforms such as Onefinestay and investments in Squarebreak and Oasis.

Softnesss at Onefinestay

Any softness in revenue or occupancy numbers for Onefinestay, AccorHotels’ luxury alternative accommodations platform. is attributable to travel regulations in the U.S., making it harder or more challenging for travelers from outside the U.S. to come to major cities like New York and Los Angeles.

“It’s not really [short-term rental] legislation impacting numbers,” Morin said. “It’s new regulations you have in terms of traveling and limitations on traveling. There’s a double-digit decrease of outside countries coming into big cities like New York and Los Angeles. We are not very present in North America in terms of hotels but you see the impact in New York and Los Angeles.”

The company’s pilot program, Accor Local, which promotes hotels as centers for offering services to the local community, is being powered by John Paul, the concierge service that AccorHotels purchased last year. CEO Bazin elaborated on the pilot during the company’s full year 2016 investors presentation held earlier this year.

The spinoff of Accor’s HotelInvest unit remains on track as the company pursues a more asset-light strategy favored by the majority of big hotel companies, Marriott and Hilton included.

Rebound in France

AccorHotels didn’t see any significant financial impact on its business from the recent terrorist attacks that took place in Berlin in December and most recently in London this month. Additionally, the company saw positive RevPAR in both France and Switzerland for the first time since 2015 in the first quarter, suggesting that the company’s business in France has rebounded, even though like-for-like revenues were slightly down. Occupancy rates in France were up, as were rates in Germany and the United Kingdom. Morin also noted that performance by Fairmont properties in North America was strong.

The one market, globally, that remains a challenge is South America, but AccorHotels is hopeful it will eventually turn itself around, which is why the company recently increased its investment in Brazil, even as the country battles a recession. In South America, 80 percent of the company’s portfolio is in Brazil, where it has 255 hotels. “We see the benefit of being in Brazil in the long run,” said Morin.

And finally, with the upcoming French presidential election beginning on April 23, Morin said he doesn’t see the results “going a bad way” or negatively impacting AccorHotels’ future plans. He said, “the French people know what’s right and what needs to be done. I may be wrong, but I don’t think that will be the case [where the outcome is negative].”

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Facebook and Google’s Travel Ad War — Digital Marketing News This Week

Noah Berger  / Associated Press

Google and Facebook are fighting to gain a greater share of the travel industry’s digital ad spending. Who will come out on top? Here, Facebook CEO Mark Zuckerberg speaks at his company’s annual F8 developer conference, April 18, 2017, in San Jose, Calif.
Noah Berger / Associated Press

Skift Take: Facebook is challenging online advertising heavyweight Google by offering innovative products that target travel brands (and other sectors). Expect the social network to seize some market share but how much remains to be seen.

— Jeremy Kressmann

As more of travel marketers’ advertising budgets shift from traditional advertising into the digital realm, a growing “war” is brewing between two of the digital ad world’s top competitors, Google and Facebook.

Google may have the upper hand for now, with the company continuing to rake in huge search marketing deals from high spenders like the Priceline Group.

But Facebook is fighting back, thanks to an audience of more than 1.8 billion monthly users and a rapidly expanding range of ad products. The company’s growing suite of travel-specific ad products like Dynamic Ads for Travel, combined with improved measurement options, are leading more travel advertisers to give the ad platform a second look.

Which platform will ultimately be the best for travel advertisers? Who will win the lion’s share of travel industry online ad spending in the future? Google is clearly the top dog but never say never. Read on for more analysis, plus the rest of this week’s top marketing news.

Understanding Google and Facebook’s Travel Duopoly
If you’re a travel marketer planning to invest in online advertising, chances are that your ad dollars will travel through the hands of one of either two companies: Google, or Facebook. How is spending on these two online ad competitors evolving? And how is the travel industry’s perception of these two ad giants changing? Read more

Spending on Native Ads Grows in the Travel Sector
One side effect of the growing popularity of online advertising is that consumers are learning to ignore it. Thanks to tools like ad blockers and a growing distaste for intrusive ads, marketers have been looking for fresh ways to break through to consumers. It’s a fact that’s leading to more investment in native ads designed to blend into the content created by online publishers. Read more

Hotels Boost Digital Marketing Spend Amid Heavy Competition
It’s no surprise that competition is brutal in the hotel sector. Between online travel agencies that allegedly squeeze hotel profit margins, and the continued growth of upstarts like Airbnb, it’s sometimes difficult for traditional hotels to stay profitable and build awareness. This combustible stew is leading many hotel brands to increase their spending on digital and social marketing. Read more

Will Blockchain Transform the Travel Industry?
Blockchain, referring to the concept of a distributed database used to store transactions or records, is typically associated with the digital currency Bitcoin. But as some proponents now argue, the potential applications for blockchain tech extend far beyond the financial sector and could have applications in the travel industry. Read more

Tracking the Growth of Myanmar’s Growing Online Travel Sector
Not too long ago, Myanmar wasn’t even on the radar of most professionals in the travel industry. Between years of authoritarian rule, a lack of infrastructure, and concerning civil unrest in regions like Rakhine state, it’s often been difficult for the country’s tourism industry to grow. But one online travel businesses, Flymya, is doing its part to change that reality. Read more

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Screening Company Clear Raises $15 Million: Travel Startup Funding This Week

Skift Take: Long-promised improvements to airport security screening and rebooking in the event of flight disruption may finally be in the offing, thanks to follow-on rounds of fundings to the startups Clear and Freebird.

— Sean O’Neill

Each week we round up travel startups that have recently received or announced funding. The total raised this week was more than $24 million.

Earlier this week we covered Freebird’s $5 million funding round, led by General Catalyst and Accomplice. The company, focusing on serving corporate travel with enterprise services, helps travelers rebook when their flights are disrupted.

clear funding skift travel startups

>>The biometric security company Clear has raised $15 million from T. Rowe Price’s New Horizon Fund. Clear says its traveler identity software is used in 21 of the largest airports in the U.S. and it expects to launch at Los Angeles International in the coming weeks.

The company will use the funding to add more locations and more technological functionalities, such as instant payments at retailers with just the tap of a finger.

The company started with a focus on airports but is now broadening its reach to other venues and payment points, such as stadiums.

Other investors include Delta Air Lines, Jeffery H. Boyd, chairman of the board of The Priceline Group, and Robert Mylod, the former CFO of The Priceline Group.

touristly

>>AirAsia Berhad ​is acquiring half of the equity of online travel planner Touristly, a trip-planner tool, through an asset injection and loan deal valued at $2.6 million (or 11.5 million Malaysian Ringgit).

AirAsia will stash its in-flight magazine into Touristly via AirAsia Investments Ltd and extend a convertible loan to Touristly for working capital and development.

Launched in June 2015, Touristly is an interactive trip planner that features more than 13,000 deals on tours, attractions, theme parks, and activities in 70 destinations around Asia Pacific.​ It is a recipient of investment funding from Netrove Ventures Group and Tune Labs.

dreamcheaper travel startup funding skift hotel rate

>>DreamCheaper, a Berlin-based travel company that helps consumers automatically rebook their hotel rooms if the rate drops, has received a $1.61 million (or 1.5 million euro) investment in a round led by Holtzbrinck Ventures and TruVenturo. The round brings its total financing to $2.7 million, to date.

The company offers its variation of a consumer service first pioneered by Yapta in the U.S. and that has been tried with mixed success by other companies, such as Tingo. DreamCheaper says it has helped rebook 5,000 hotel rooms for users so far since its launch in 2014.

Check out our previous startup funding roundups, here.

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United Airlines President: Leaving New York’s JFK ‘Was the Wrong Decision’

United Airlines

United Airlines flights from San Francisco and Los Angeles to Newark have a special name — p.s. New United President Scott Kirby said those flight should have probably stayed at JFK, not Newark. United Airlines

Skift Take: Is there a more honest airline executive than United’s Scott Kirby? Probably not. But that’s a good thing. United’s 2015 decision to leave New York JFK was a head-scratcher, and it’s nice to see new management calling it a mistake.

— Brian Sumers

In October 2015, United Airlines pulled out of New York JFK, moving all its flights from San Francisco and Los Angeles to Newark, where it has a hub. United’s public relations staff spent considerable effort spinning the move as a positive, promising “significant benefits” and an overall “overall higher-quality experience” for flyers.

But a year and a half later, United’s new president, Scott Kirby, says moving the flights from JFK was a mistake. Many of United’s most lucrative West Coast customers, he said, want to fly into Manhattan and not New Jersey. And United lost some of them when it switched the flights to Newark, Kirby told employees at a recent town hall meeting in Newark.

“I wish I could roll back the clock and change the decision,” Kirby said, according a recording of the event. “It was the wrong decision.”

At the time, United’s management team — led by former CEO Jeff Smisek – argued the carrier had no choice. The airline claimed it had lost money on the two routes for seven years, and it was having trouble competing with four other carriers flying the same routes with similar business class and economy products — JetBlue Airways, American Airlines, Virgin America and Delta Air Lines. United’s lease at JFK was also expiring, so executives said the timing was right.

Kirby, who until August 2016 was American’s president, said American’s team was pleased when United left.

“You can probably personally blame me, at least to some degree, for the fact that United pulled out,” he said. “When I was at American Airlines, we were consciously trying to push United out of JFK. That was our goal.”

In his response to the employee at the town hall meeting, Kirby suggested United executives did not think strategically before dropping the JFK flights. The routes may have been unprofitable alone, but the customers on them were unusually important.

“The real reason it was a mistake was it let American Airlines in particular go win a bunch of big corporate accounts,” he said. “People like Disney and Time Warner — two big examples — are corporate accounts that had been United exclusive corporate accounts and not only flew United on the transcon [routes] but flew United from L.A. to Heathrow and all across the country.”

Many of the corporate contracts were unusual because the companies cared less about pricing than typical businesses, Kirby said. Actors, for example, usually must fly in premium cabins — regardless of whether the fare is $1,000 or $10,000.

“Those are the kind of corporate accounts [where] on-air talent has contracts that say they fly first class,” he said. “They pay first class fares — it’s completely irrelevant what the price is. … We opened the door and let American in on contracts like that.”

May not return to JFK

Still, Kirby did not tell employees United will return to JFK, and he noted many of the lucrative customers United lost might not come back if it did. Instead, he said, United will bolster its Newark hub.

“We would never get all those customers back but one of the things we are going to focus on is making Newark the best airport, the best schedule, the best everything for New York,” he said.

Kirby’s goal is to get United back to the 30 percent market share it held in New York when Continental and United merged. Today, he said, United has about 26 percent share. “That’s a big, big drop,” he said.

He said it makes sense to grow in New York, as United executives estimate their carrier is the most profitable major airline in the region — by a substantial margin. United operates a much larger hub than American and Delta at JFK, and that additional scale usually makes flights more profitable, he said.

“We have about 15 percent margins here in Newark,” he told employees. “We estimate Delta in New York has a 4 percent profit margin, even when times are good. And American is somewhere in between.

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Canada’s Largest Low-Cost Carrier Is Starting an Even Cheaper Airline

Todd Korol  / Reuters

A WestJet Airlines Boeing 737-700 takes off in Calgary. WestJet plans to start an ultra low cost carrier to compete with several new entrants. Todd Korol / Reuters

Skift Take: This is an interesting move by WestJet, commonly considered the Southwest Airlines of Canada. It’s likely mostly defensive, as several ultra low cost carriers plan to start in Canada. But it’s also probably an opportunistic play that may improve revenues.

— Brian Sumers

Canadian discounter WestJet Airlines Ltd. is arming itself for more fare wars by planning to start an ultra-low-cost carrier to fend off domestic upstarts.

Service is expected to begin late this year with a fleet of 10 Boeing Co. 737-800s in “high density” configuration, Calgary-based WestJet said in a statement Thursday. The venture will aim to offer “no frills, lower-cost travel options,” Canada’s No. 2 carrier said.

Founded in 1996 to cater to leisure travelers, WestJet has been moving away from its original no-frills model — patterned after U.S.-based Southwest Airlines Co. — by adding premium economy seats, rolling out a short-haul unit and starting overseas flights to European destinations such as London. Its fleet, meanwhile, has expanded from single-aisle 737s to include turboprops and double-aisle jets.

“This makes a lot of sense,” said AltaCorp Capital analyst Chris Murray. “This ULCC lets them use existing aircraft, fly to routes they already know, densify their network, plus it spreads their overhead costs better. It’s a lower-risk proposition than going to a wide-body strategy.”

Canada Jetlines Ltd. and Enerjet Ltd. have announced plans to begin operating ultra-low-cost carriers to challenge WestJet and larger rival Air Canada. Jim Scott, chief executive officer of Canada Jetlines, dismissed WestJet’s plan as “nothing more than an ‘airline within an airline’ that will not increase competition and it remains to be seen whether it will be able to achieve the full benefits of a ULCC.”

Complicates Plans

WestJet’s new carrier “significantly complicates the plans of other participants,” Murray wrote in a note Thursday. The new service will also protect WestJet from “market erosion in the highly sensitive fare category of travelers.”

The decision to move ahead with the new unit came after years of studying the market, Bob Cummings, WestJet’s executive vice president, said in a telephone interview.

“The new entrants are a factor, but only one of five or six,” Cummings said. “We think the timing is right. Were the new entrants a tipping point? No.”

Cummings declined to provide details on fares, routes or seating configurations, saying they will be announced later “for competitive reasons.”

Not Available

Canada is the only member of the Group of Seven industrialized nations that doesn’t have access to an ultra-low-cost carrier, Murray wrote. While the country probably would support an ultra-low-cost market of about 50 aircraft and 10 million passengers a year, “significant stimulation” through lower prices is “required to be effective in the space.”

With its Encore short-haul unit and widebody jets to Europe, WestJet “already has a lot of initiatives underway and we question whether there are enough human resources to also launch an all-new ULCC,” Cameron Doerksen, a National Bank Financial analyst, said in a note.

WestJet is continuing to weigh whether to add widebody jets to its own fleet on a permanent basis, Cummings said. The carrier now flies some leased Boeing 767 aircraft that are more than 20 years old.

“We’re evaluating widebodies as a line of business,” Cummings said. “That includes being able to come to terms with a manufacturer on an order, but we’re not there yet. Widebody certainly isn’t on the shelf.”

To contact the reporter on this story: Frederic Tomesco in Montreal at tomesco@bloomberg.net.

©2017 Bloomberg L.P

This article was written by Frederic Tomesco from Bloomberg and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to legal@newscred.com.

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Budget Airline VietJet Looks to Increase Foreign Ownership

VietJet

VietJet is ordering new planes to keep up with domestic demand. VietJet

Skift Take: After its stock market debut a couple of months ago, VietJet is attracting a lot more interest from foreign investors and the airline is looking to accommodate them. The airline won’t have much trouble securing a deal.

— Dennis Schaal

VietJet Aviation Joint Stock Co., which controls almost half of Vietnam’s domestic airline market after first taking flight six years ago, received shareholder approval to increase foreign ownership to meet investor demand in the nation’s soaring travel industry.

Shareholders meeting in Ho Chi Minh City agreed to raise the cap on foreign ownership to 49 percent from 30 percent as the budget carrier forecasts 2017 profit to rise 36 percent from $110 million (2.5 trillion dong) in 2016, the company said. Carrier’s higher foreign ownership now needs the approval of Prime Minister Nguyen Xuan Phuc because aviation is considered a restricted industry with a 30 percent foreign ownership cap.

VietJet has 136 foreign investors who own 26 percent of the company, Chief Executive Officer Nguyen Thi Phuong Thao said in an interview. Raising the foreign investor limit is not aimed at attracting a strategic investor, though the company is be open to one, she said.

“I just want to create more investment opportunities to those who want to invest in VietJet and create better liquidity in the market,” she said.

Shares of VietJet have surged 56 percent since its trading debut on Feb. 28. The stock rose 0.2 percent to 131,600 dong at the close in Ho Chi Minh City on Thursday. Shares dropped 1.1 percent at the midday break. The benchmark VN Index was down 0.6 percent.

“Vietnam’s aviation industry is very attractive to investors,” said Tran Thi Hai Yen, a Ho Chi Minh City-based analyst at ACB Securities JSC. “There are more and more foreign investors interested in this company now.”

VietJet began its service in late 2011 after being founded by billionaire Nguyen Thi Phuong Thao in 2007. The carrier competes with national carrier Vietnam Airlines, which owns 70 percent of budget carrier Jetstar Pacific Airlines Aviation JSC, with Qantas Airways Ltd. holding the remaining 30 percent. Vietnam Airlines also owns Vietnam Air Services Co., known as Vasco.

VietJet has a 42 percent share of the domestic aviation market, the same as Vietnam Airlines, said Brendan Sobie, Singapore-based chief analyst at CAPA Centre for Aviation. The rest of the market is controlled by Vietnam Air’s subsidiaries. VietJet could achieve 50 percent domestic market share within three years, Sobie added.

(Updates with remarks from VietJet chief executive officer in third paragraph.)

–With assistance from Nguyen Kieu Giang

©2017 Bloomberg L.P.

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The Innovators of Extended Stay — Skift Corporate Travel Innovation Report

Rick Schwartz  / Flickr

Traditional hotel rooms are not always the best choice for business travelers; extended stay properties are evolving to meet the needs of modern customers and homesharing companies are working to appeal to road warriors. The lobby of a Residence Inn in Vancouver, B.C. is shown in this photo. Rick Schwartz / Flickr

Skift Take: As extended stay properties and homesharing companies seek to expand their markets, will more business travelers opt for the comfort of home-like amenities?

— Hannah Sampson

The Skift Corporate Travel Innovation Report is our weekly newsletter focused on the future of corporate travel, the big fault lines of disruption for travel managers and buyers, the innovations emerging from the sector, and the changing business traveler habits that are upending how corporate travel is packaged, bought, and sold.

This week we found another reminder of the way that corporate travel is lagging behind leisure. A new study from the Global Business Travel Association shows that just 17 percent of travel policies allow travelers to use homesharing services such as Airbnb.

According to an earlier study, far more travelers — 37 percent — thought they were allowed to opt for homesharing. That discrepancy suggests business travelers might be breaking their own companies’ rules when it comes to staying at an Airbnb or similar properties.

The issue is complicated, the report points out: “For some road warriors, home shares likely feel more comfortable and less sterile than a nondescript hotel room. However, as attractive an alternative as homesharing is for many business travelers, it presents a number of considerations travel managers must take into account.”

Those include worries about safety, security, predictability, deposits, cancellation policies, and a lack of consistency.

Even as homesharing companies work to address the concerns of the corporate travel world, a longstanding business travel option is seeing increased demand. The lodging industry’s extended stay segment is evolving to appeal to younger travelers with more communal spaces and home-like environments.

How long will it take for homesharing to become widely accepted? Will Airbnb threaten extended stay, or will both see increased demand? And how will traditional hotels respond?

— Hannah Sampson, Skift 

Social Quote of the Day

hunting for a pet sitter to give my cat medicine 4x a day while I’m out of town for business travel is the most adult I’ve ever adulted.— @brickchip

Business of Buying

Alaska Air Overtakes American Airlines in Annual Loyalty Program Awards: Mileage Plan from Alaska Airlines just won as the best airline loyalty program in FlyerTalk’s annual survey — largely because of its distance-based earnings. Read more at Skift

How Extended Stay Hotels Are Pivoting Towards a New Generation of Travelers: The extended stay portion of the lodging business continues to see strong demand. But are extended stay brands doing enough to keep up with travelers’ evolving tastes and needs? And what about Airbnb? Read more at Skift

New Business Hotel in London To Test Whether Lifestyle Category Can Scale: The Ned Hotel in London wants to be known as an urban resort and not a traditional business hotel. The founders hope to define the business hotel — we mean, the urban resort — of the future. Read more at Skift

What Hotels Are Doing to Win Your Loyalty: 5 Podcast Takeaways: With so many hotel mergers in recent years, loyalty is being reimagined for bigger, broader, more diverse audiences. But can any one loyalty program appeal to all travelers? Our latest podcast dives into all the changes. Read more at Skift

Trump Travel Ban Prompts Emirates to Cut U.S. Capacity: President Trump’s travel ban was bound to have an impact on demand from the affected countries, so Emirates’ decision shouldn’t come as a shock. It will be interesting to see if there is any sort of reaction from the U.S. carriers that have been so critical of the Gulf airlines. Read more at Skift

Safety and Security

IHG Reveals Second Credit Card Data Breach Occurred in 2016: This is yet another reminder for the hotel industry about the crucial importance of cyber security. Read more at Skift

U.S. May Tighten Visa Waiver Program, Homeland Security Chief Says: Terrorism is a real concern, but if the U.S. rolls back the visa waiver program, it could have major repercussions for the tourism industry. And that’s a big potential problem. Read more at Skift

What Trump’s First 100 Days Tell Us About Travel’s Next Four Years: Confusion and uncertainty have become the new reality for the U.S. travel industry, and travelers around the world, following President Trump’s first 100 days in office. Only time will tell whether his policies will inflict lasting damage on U.S. travel companies and the image of the U.S. as a preeminent international destination. Read more at Skift

Disruption + Innovation

Corporate Travel Still Doesn’t Get Homesharing Despite Business Traveler Use: Business travelers and their employers want safety, quality, and consistency; if homesharing companies can provide those things, we expect more acceptance from travel policies. Read more at Skift

Uber’s Growth Is Stalling Among U.S. Business Travelers: Even if its growth has slowed gradually, Uber still has a huge advantage over its rivals in corporate travel. Its global scale, as well, bodes well for Uber continuing to grow as an option for international business travelers. Read more at Skift

Apple to Test Self-Driving Car Software on Public Streets: Apple’s taking tentative steps to join the self-driving car melee. It’s gridlock already: On the Left Coast in California 29 other companies already have permits to hit the streets to test self-driving cars. This will be the mother of all shakeouts when things get serious — and will force travel managers to pay attention. Read more at Skift

COMMENTS

Skift editors Hannah Sampson [hs@skift.com] and Andrew Sheivachman [as@skift.com] curate the Skift Corporate Travel Innovation Report. Skift emails the newsletter every Thursday.

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Alitalia Staff Votes on Cost-Cutting To Avoid Bankruptcy

Antonio Calanni  / Associated Press

An Alitalia Airbus A320 at the Linate airport in Milan. The carrier is hoping to stave of the threat of bankruptcy. Antonio Calanni / Associated Press

Skift Take: Employees of Alitalia are being given a choice: accept a wage cut or prepare to find another job. They are paying a heavy price for years of mismanagement at the airline that has put it on the brink of bankruptcy.

— Patrick Whyte

Alitalia employees are voting on whether to accept a government-brokered deal to save Italy’s flagship airline from bankruptcy.

Some 12,500 Alitalia workers began voting Thursday on a package that eased steep cuts sought by parent Etihad Airways, and which will open 2 billion euros ($2.1 billion) in investment to keep the airline afloat. Voting runs through Tuesday.

Italy’s economic development minister, Carlo Calenda, has excluded nationalizing the airline, putting pressure on workers to accept the deal that foresees wage cuts of about 8 percent, down from as much as 30 percent, and reduces the number of layoffs by about one-third to 1,700.

Calenda was quoted by the Turin daily La Stampa as saying a no vote would lead to a six-month period of extraordinary administration followed by bankruptcy.

This article was from The Associated Press and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to legal@newscred.com.

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SeaWorld’s Last Captive Killer Whale Was Just Born

Chris Gotshall  / SeaWorld Parks & Entertainment via Associated Press

A mother orca, Takara, guides her newborn to the water’s surface at SeaWorld San Antonio in this image provided by SeaWorld Parks & Entertainment. Chris Gotshall / SeaWorld Parks & Entertainment via Associated Press

Skift Take: The birth of the last killer whale in SeaWorld’s care will bring a lot of fresh headlines about the company’s decision to end its captive orca breeding program — a narrative executives are trying to move away from with a renewed focus on non-animal attractions.

— Hannah Sampson

The last orca has been born in captivity at a SeaWorld park in San Antonio just over a year after the theme park decided to stop breeding orcas following animal rights protests and declining ticket sales.

The Orlando-based company said the orca — the last in a generation of whales bred in confinement — was born Wednesday afternoon. SeaWorld did not immediately name the calf because the park’s veterinarians had not yet determined whether it was male or female.

The mother, 25-year-old Takara, was already pregnant when SeaWorld announced in March 2016 that it had stopped breeding its orcas. The gestation period for orcas is about 18 months.

Preparing late last month for the moment, SeaWorld’s chief zoological officer, Chris Dold, told The Associated Press he expected the birth to be bittersweet, because it would be the last such event at any of the parks. But just hours after the calf was born about 3:30 p.m. EDT Wednesday, Dold said, SeaWorld staff only felt like celebrating. SeaWorld said mother and calf both appear healthy.

“These are extraordinary moments,” he said by phone while traveling to the U.S. from Abu Dhabi, where SeaWorld is developing its first new park without orcas. “It’s a tempered celebration only because we’re focused on the health of these guys.”

SeaWorld decided to stop breeding orcas, and phase out its world-famous killer whale performances by 2019, after public opinion turned against keeping orcas, dolphins and other animals in captivity for entertainment. The backlash intensified after the 2013 release of “Blackfish,” a documentary critical of SeaWorld’s orca care. It focused on the orca Tilikum, which killed trainer Dawn Brancheau in Orlando in 2010, dragging her into the pool before shocked visitors after a “Dine with Shamu” show.

Tilikum, which sired 14 calves over nearly 25 years in Orlando, died of bacterial pneumonia in January.

The newborn calf was sired by Kyuquot (pronounced ky YOO kit) at the San Antonio park by natural means. It brings SeaWorld’s orca population in the U.S. to 23. All the orcas are expected to remain on display and available for researchers for years to come in Orlando, San Diego and San Antonio.

SeaWorld has said it plans to introduce new “natural orca encounters” in place of theatrical shows. This summer, the San Diego park will unveil a new, educational attraction in a revamped pool, and new orca attractions eventually will follow in San Antonio and Orlando.

The calf will be visible to visitors either in the orca stadium pool at the San Antonio park or in two adjacent pools. Observations about the calf and Takara by SeaWorld trainers will be provided from the moment of birth to researchers trying to fill gaps in their data about wild killer whales.

Dold said veterinarians at the San Antonio park told him the calf was born normally — tail first — after about an hour and a half of smooth labor. Both orcas were swimming calmly, including taking breaths at the water’s surface, and trainers would be watching for the calf to begin nursing.

“Mom generally will rest but she can’t rest too much …. mom’s not holding onto the calf, but it’s riding in her slipstream, and that’s how it gets around,” Dold said. “Our expectation is that all of this will go smoothly, but we take none of that for granted.”

Birth control and “social management” will prevent future orca pregnancies, said spokeswoman Suzanne Pelisson Beasley. SeaWorld has not collected a wild orca in nearly 40 years, and most of its orcas were born in captivity.

Researchers have said they worry that SeaWorld’s decision to stop breeding orcas will slowly reduce their ability to study orca health, growth and behavior, limiting them in coming years to collecting data from a small pod of aging whales.

Heather Hill, a St. Mary’s University comparative psychologist who plans to monitor the sleeping habits of Takara and the calf over the coming year, said it was frustrating to see research opportunities at SeaWorld undermined by public opinion amid federal cuts to science funding.

“This will be one of the first times we’ll be able to see not just a mother with a newborn calf but also a newborn calf with siblings,” Hill said.

In a statement, People for the Ethical Treatment of Animals Executive Vice President Tracy Reiman said the mother and her calf should be retired to a seaside sanctuary.

“Throughout her life, Takara the orca has been artificially inseminated many times, separated from her mother and two of her children, and shuffled from theme park to theme park at SeaWorld’s whim,” PETA’s statement said.

This is Takara’s fifth calf. Two of her other offspring remain at the San Antonio park, while one lives at SeaWorld Orlando and another has been loaned to a park in Tenerife, Spain. SeaWorld has no current plans to separate Takara and the newborn in the future, or to move any of its other orcas, Dold said.

In March, Dold said SeaWorld remains committed to orca research and conservation, calling the last orca birth in captivity “a solemn reminder of how things can change and how things can be lost.”

This article was written by Jennifer Kay from The Associated Press and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to legal@newscred.com.

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