The IHG portfolio consists of more than 6,000 open hotels across 17 brands in over 100 countries. In the past five years, IHG has broadened its portfolio by acquiring or launching six new brands including Luxury & Lifestyle brands Six Senses, Regent and Vignette Collection, Premium brand voco hotels, Essentials brand avid hotels, and Suites brand Atwell Suites.
Mark Sergot, SVP of Global Sales, joins Rita Jiang, VP of Commercial for Greater China and Paul Proctor, VP Commercial for Europe for a conversation about IHG’s leadership in a world of change.
BTE:Tell us about the portfolio of IHG brands and why you think it’s of value to business travelers and travel managers.
SERGOT: At IHG Hotels & Resorts, we have a diverse customer base, and that means we need to have an equally diverse portfolio. Our brands cover everything from Luxury & Lifestyle brands like Regent, InterContinental and Hotel Indigo, to mainstream and premium brands like Holiday Inn, Holiday Inn Express and Crowne Plaza.
IHG is still growing, with its portfolio set to expand by a further 30 percent, with more than 1,800 hotels already signed in our development pipeline. This enables us to continue to provide travel managers with the diversity in choice they need to be successful.
BTE: What steps is IHG taking to tap into the post-pandemic recovery?
SERGOT: The hospitality industry is working through a number of challenges right now. At IHG Hotels & Resorts, our goal is always to provide the highest level of service to our travelers to ensure they have a great experience. IHG’s combination of choice and flexibility is aptly portrayed in our new high-profile Guest How You Guest campaign, which has just launched in the US and the UK and will be rolled out in additional countries in the latter half of this year.
We’ve made several big investments this year. We started with the launch of IHG One Rewards – a reimagined loyalty program which is already gaining attention as a best-in-class offer.
BTE: What’s been the response to the new program?
SERGOT: By conducting extensive research among travelers, hotel owners, and operators, we were able to shape IHG One Rewards into a modern loyalty program that not only meets our member’s needs but also anticipates them. We have heard positive responses from travelers. They particularly love the new Milestone Rewards. In addition, our new loyalty program will also help provide cost savings for our B2B customers.
It’s all powered by the new IHG One Rewards app, which allows members to access these rewards on the go. Among many enhancements, the new app offers streamlined booking and allows guests to check-in faster.
BTE:What other initiatives does IHG have in the works?
SERGOT: From small and midsize businesses to large corporations, and agency partners booking vacation packages, high-end tours, and leisure travel experiences, we have a set of tools and resources that address the unique needs of our customers.
Our user-friendly Customer Insights Portal provides travel managers with easily downloadable, customizable reports that offer greater visibility and transparency into their spending and savings. The IHG Business Edge global program streamlines and tailors the travel process to fit the needs of small and midsize enterprises offering them value through a community experience with relevant content to help SME customers grow their business while growing with IHG. For our Groups & Meetings planners and bookers, we continue to respond to their changing needs with our offers, programming and web experience. We also recently launched our Luxury Advisor Portal with access to content and information on our brands and new destinations.
Our ways of working and engaging with accounts are also evolving, with a focus on leveraging the scale of TMC partners and central payment solution providers throughout the lifecycle of travel and event management, making it easy to book, easy to update, easy to reimburse, and easy to manage.
BTE: What are some other opportunities that lie ahead for IHG in 2023?
SERGOT: I’m particularly excited about our efforts in sustainability and diversity, equity and inclusion. In many ways, within the hospitality industry, caring for others and our communities is naturally woven into our DNA. As a company, we have truly taken this to heart and embedded this across our business. We’re stepping up ambitious carbon reduction plans as part of Journey to Tomorrow and pushing ahead on delivering important diversity, equity and inclusion commitments.
BTE: How is IHG responding to the staffing shortages business travelers are seeing?
SERGOT: As we all know, hotels are not immune to rising commodity and labor costs, and we are in a challenging environment right now. We are working closely with our owners and hotels to build solutions that create operational efficiencies and lower costs. We are addressing staffing challenges by supporting general managers, hiring managers and HR colleagues with new and improved recruitment tools.
More specifically, we are devoting more attention to two on-property areas long proven to impact guest satisfaction – housekeeping, and food and beverage. Our new “Daily Room Refresh” model prioritizes the daily housekeeping elements our guests value most. Most of our food and beverage venues in Lifestyle, Luxury and Premium hotels are now open for breakfast and dinner. However, some have yet to resume lunch or room service.
BTE: Tell us about IHG’s global plans going forward.
SERGOT: We feel we came out of the pandemic an even stronger, more resilient business, well positioned to handle quickly changing circumstances around the world. Our global development strategy remains agile, specifically in response to the rise in “bleisure” travel. We’re seeing this play out differently in our priority regions.
JIANG: In Greater China, we’ve seen significant growth. We are pretty bullish on our outlook for 2023 in this region. This is mainly due to the expected border reopen, and business trips normally recover first. The carried over effect of the ‘Zero COVID’ policy in mainland China will still be a potential headwind. We will be agile in identifying the industries with the strongest growth opportunities and optimizing our resource allocations accordingly.
Our mix of corporate accounts are now moving toward more national and state-owned enterprises. This is a change from pre-pandemic, when international firms were taking the biggest share. Events have been smaller in size, and shorter in lead time, mainly due to the ‘Zero COVID’ policy. Our WeChat based booking portal encourages guests to share their preferences of stay during booking, and feeds this information back to hotels as part of their guest profile. This allows our hotels to deliver relevant and consistent service.
PROCTOR: In Europe, our luxury hotels remain front and center. We’ve seen notable growth across our luxury and lifestyle brands – including our InterContinental Hotels & Resorts and Kimpton Hotels & Restaurants offerings. Our Vignette Collection brand also continues to expand, thanks in large part to a strategic partnership with JJW Hotels & Resorts.
On a regional scale, we’re seeing strong recovery across EMEAA led by impressive growth within France, Turkey, the Iberian region and Italy. Our pipeline of 278,000 rooms around the world grew by 2.4 percent. In Europe, we have 732 open hotels with a further 174 hotels in the pipeline.
We are also making great progress in the transformation of the Holiday Inn brand family in Europe. Over 90 percent of the existing European Holiday Inn brand family portfolio has now committed to or already completed the transformation of their hotels. There is also real potential for Staybridge Suites in Europe, with the opening of the Staybridge Suites Cannes Centre in February 2023.
SERGOT: Within the Americas, we’re also seeing strong growth in the extended stay segment. In the first half of 2022, more than one-third of our overall Americas signings came from our Staybridge Suites and Candlewood Suites brands. Earlier this year, we opened our first Atwell Suites, an upper midscale brand which already is among our strongest pipeline brands.
We’re also witnessing stellar performance in the Americas, with a pipeline of 959 hotels (accounting for more than 100,000 rooms) and overall profitability now outpacing 2019 statistics.
BTE: Overall, IHG’s recent earnings posted revenues almost matching 2019.
SERGOT: Our half-year results reflect a great first six months for us at IHG. IHG has remained strong throughout the pandemic, with our performance and data showing that when people can travel, they do. We continue to see the inherent desire to travel for both business and leisure, and have not seen signs of cooling demand.
