Las Vegas - InterContinental Hotels Group is toughening up
some of its brand standards, getting more aggressive with revenue management
and in the coming year plans to introduce new technology and service offerings
in an effort to drive up rates and revenues, company executives said here at
the company's Investors & Leadership Conference in late October.
IHG Americas president Kirk Kinsell told the assembled crowd
of property owners and managers that even following such recent initiatives as
the billion-dollar Holiday Inn relaunch, he is "not yet happy" with overall
brand performance within IHG. "In the highest demand period we've known,
we can't seem to drive rate and [revenue per available room] enough," he
said.
Executives at the conference frequently encouraged property
owners to use IHG's revenue-management tools, including a predictive technology
that advises hotel managers when to should increase rates or when to shift available
supply to online travel agency and other distribution channels. Americas COO
Bob Morse said the company is working with its owners association to develop a revenue
management certification requirement.
"That means every property will either have to have a
certified revenue manager at the hotel, have above-property certified oversight
for revenue management or sign up and purchase the expertise from us,"
Morse said. "You don't have to get it from us, but you will have to have
it."
With channel management, chief commercial officer Keith Barr
noted that about half of IHG bookings in the Americas are coming through direct
distribution channels, and during the past year, IHG-direct web bookings were
up 18 percent compared with two years prior. About $600 million in bookings
will come through mobile devices this year, he added.
Aside from the overarching initiatives, executives also
detailed strategies to drive more revenues through specific brands.
Crowne Plaza: IHG's
upscale Crowne Plaza brand, with about 400 properties globally, is in the midst
of a brand overhaul, with the first of three phases nearing completion, IHG
vice president for upscale brand management in the Americas Gina LaBarre said.
That first phase has centered on "doing the basics well"
and "improving the guest experience, getting us closer to parity with our
competitors," she said. This has included new bedding, which about 90
percent of Crowne Plaza properties have implemented, and new service training.
The work reversed an 18-month decline in overall guest satisfaction,
measured internally, and has improved revenue performance at hotels, LaBarre
said.
IHG also is removing substandard Crowne Plaza properties,
including three dozen that have left the system since 2011 and an additional
five that are targeted for removal soon.
"It's something we're constantly doing," LaBarre
said. "We meet monthly and review the portfolio, hotel by hotel."
Crowne Plaza now is moving into the next phase of its
overhaul, which includes widespread implementation of some initiatives it
recently has tested. One, which it plans to introduce next year, is a
connectivity package that includes free, single-sign-on Wi-Fi for all guests,
wireless printing and outlets and charging areas designed for easy access, she
said.
The brand also plans to launch mobile check-in for IHG
Rewards Club members, likely near the end of 2014, as there is "still some
more developments to do on the software side," according to LaBarre. The
brand also plans new "energy essentials" stations, featuring such
amenities as healthy snacks, towels, water and information about local running
routes.
Crowne Plaza also has developed its first standardized room
design, which LaBarre said should speed up ongoing renovations. Hotels are not
required to renovate until they are up for relicensing, but LaBarre said she
hoped the design would "build a compelling enough case that some owners
will renovate earlier."
Holiday Inn Brands: During
the past five years, IHG has overseen a billion-dollar relaunch of the Holiday
Inn and Holiday Inn Express brands, which involved new amenities and design and
the removal of 1,400 substandard properties even it added 1,900 hotels to its
system globally. Now, the company is focusing on getting a better rate for
Holiday Inn, a full-service brand that includes a restaurant and a bar, than the
select-service Holiday Inn Express.
"While we've grown at impressive rates, we're still not
growing share fast enough," said Heather Balsey, senior vice president of
Holiday Inn family brand management in the Americas. "It's been said that
midscale full-service is dying, but I don't believe that."
As a part of that, IHG is raising the minimum score required
for Holiday Inn hotels to maintain in IHG’s internal guest feedback surveys,
though Balsey said it "is not about kicking hotels out of the system."
Holiday Inn also plans to test a new dinner and beverage program in 50 hotels
in the United States and Canada beginning in January as well as standards for
lobby and restaurant décor in the middle of 2014, Americas brand leader Maurice
Cooper said.
Holiday Inn Express, meanwhile, is tweaking its food and
beverage programs next year, adding such healthier breakfast options as oatmeal
or turkey sausage to its breakfast bar and adding wine and beer to its sundry
shops, said Jennifer Gribble, the brand's director for the Americas.
Both brands also plan rapid expansion during the next
several years. Holiday Inn Express opened 114 new hotels last year and plans to
open another 450 around the world over the next three to five years, Gribble
said. Holiday Inn also "will accelerate the pace of growth,"
particularly concentrating on top markets where it currently does not have a
presence, according to Cooper.
Extended-Stay Brands:
Recent improvements to the upscale Staybridge Suites and the midprice
Candlewood Suites include a new bedding program for both brands and renovations
at the 19 Staybridge properties and 61 Candlewood properties owned by
Hospitality Properties Trust, said Robert Radomski, vice president of brand
management for the two brands. Candlewood also recently introduced a "lending
locker," from which guests can borrow such items as kitchen appliances or
lamps for their stay.
IHG also is eyeing further international expansion for its
extended-stay brands. Radomski said that "Mexico has a lot of potential"
for Staybridge, and the brand also has opened properties in such markets as
London and Beirut, where the extended-stay hotel tier remains a relatively
unknown concept.
"We're taking the approach that we want to make sure it's
the right market—quality over quantity—because we need to establish a
performance record within these regions," Radomski said. "We're not
only launching a brand; we're launching a category."
Hotel Indigo: IHG's
boutique Hotel Indigo brand turns 10 next year, and during the past three
years, revenue per available room has increased more than 40 percent at Indigo
properties, brand director Mary Winslow said. Openings this year have included
properties in Anaheim, Brooklyn, Hong Kong, Barcelona and Tel Aviv, and the
brand also has properties under development in Bali and Paris as well as in
Chicago and New York near the under-construction One World Trade Center, she
said.
The brand now is looking to combat a perception of
inconsistency, that it's "a mixed bag, with product and service varying
from hotel to hotel," Winslow said. That process will include sending
consultants to properties more frequently to improve service offerings as well
as a new breakfast program that it already has tested in eight U.S. hotels.
Even: IHG's Even
brand, developed to focus on fitness and wellness, will open its first
properties next year, in Rockville, Md., and Norwalk, Conn. Two Manhattan
properties are scheduled to open in 2015.