At an event at the Musee des Arts Decoratifs in Paris, France recently, the Michelin guide unveiled its first global selection of keys – the equivalent of stars, but for hotels. But hours before, at a separate event at the ornate 18th century Pozzo di Borgo mansion also in Paris, it unveiled something more controversial: An honest look into the ways that it makes money from such reviews, both on the hotel and restaurant sides of its operations.
It was the first time that the French company spoke explicitly about what many have known to be true for years: that government-run tourism boards pay for Michelin guide restaurant reviewers to come to their states and cities.
For years questions have swirled in the travel industry about whether the company can maintain impartiality in awarding stars to local restaurants while at the same time accepting payment from the tourism bodies charged with their promotion.
As it turns out, reviewing hotels – an expensive practice that has become all but impossible for most publications to do in a thorough, independent way – is what forced Michelin to come clean on its practices.
And that’s not because Michelin is compromising its standards. In fact, executives at the guide confirmed that the company is paying full-price, publicly-listed rates for every hotel it vets, and also for the flights required to get there. It does the same with restaurants, which is visits anonymously.
In order to go global with its hotel ratings, though, the guide has had to create different revenue streams. In October 2018, it acquired the hotel booking platform Tablet, creating a platform for Michelin loyalists to plan and book their vacations. The company takes a cut from each of these bookings at an industry standard rate of around 15%.
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