FOROS | 10/04/2013

Understanding Customers Goes Beyond Brand: IHG Chief

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Understanding your customers goes far beyond having a strong brand; while safety, cleanliness and a good night’s sleep remain the top three priorities for hotel guests, according to Richard Solomons, Chief Executive, Intercontinental Hotel Group (IHG).



“We need to understand the customer better and make sure our brands describe and deliver what they want. We announced two new brands last year and had huge interest around those, because it’s clear that it’s not more of the same – the brands are targeting well,” he said during a session entitled ‘Hotels: where next for the world’s biggest hotel brands?’ on the second and final day of the 13th Global Summit, organised by the World Travel and Tourism Council (WTTC).

The top three requirements in hotels – forget about the brand and its message – are safety, cleanliness and good night’s sleep. But the question is how do we deliver a targeted, more personalised service?” Solomons asked.

“I think what have to have is a clear corporate strategy, and determine where we’re going as a company; as well as decide how, where and why we deliver value. The brand is about definition; again as an industry we’re trying to appeal to everybody all the time. This creates commoditisation in the industry and brands aren’t clear. What a brand stands for, who your consumers are and how you relate to them are the most important factors in the industry today,” he continued.

Solomons was later joined by Darren Huston, CEO, Booking.com; Arthur de Haast, Chairman, Hotels and Hospitality Group, Jones Lang Lasalle; Adam Weissenberg, Global Travel, Hospitality & Leisure Lead, Deloitte Touche Tohmatsu Ltd; and Tom Klein, President, Sabre Holdings in the discursive session moderated by CNBC Anchor Yousef Gamal El-Din.

For the online travel consumer, it’s essential for brands to adapt to consumer needs, the Booking.com CEO said: “In the age of the internet, brands need to adjust to deliver customer expectations. Your brand promise needs to have differentiation as well.” As the online consumer now has more choice, brands still play an important role because of the promises they deliver, he continued. Working with brands has proved fruitful, he said, as the online distributor runs an “agency model”. If the hotel offers special rates, the guests pay them; if they offer free wi-fi they can also advertise that, he said.

“The issue is ultimately trying to generate ROI for investors and give guests a good product, that’s what it’s all about,” Solomons added. “As long as the guest understands what they’re booking when they book, then we’re happy to do the business. We can’t attract everybody and that’s clearly where third parties come in,” he said of the relationship between online distributors and hotel brands.

The discussion also moved to identify the changing relationships between hotel owners and operators, with panellists agreeing that owners and investors are increasingly interested in understanding how operators work, especially in terms of technology.