When a brand reaches 3,000 hotels open across 50 countries, what does it do for an encore?
HOTELS posed that very question to Stephanie Atiase, vice president at IHG Hotels & Resorts and global brand head for Holiday Inn Express, which is the world’s biggest brand, according to HOTELS annual ranking of the world’s biggest hotel companies.
The first Holiday Inn Express opened in 1991 and targeted the upper economy market, focusing on creating a “simple, smart” travel experience for its guests. The brand’s popularity is evident as it celebrates its 30-year milestone with more than 3,000 open hotels across 50 countries, accounting for more than one-third of IHG’s global pipeline.
While the brand enjoys a good presence across the world, it has great success in China. Atiase attributes this success to the franchise model in the China market. “In May 2016, IHG Hotels & Resorts opened the franchise model of Holiday Inn Express in the China market, providing Chinese owners with another choice beyond the management model, and a more flexible cooperation model for both parties,” she said. “By the end of 2018, 143 franchise projects had been signed in 31 months under the new model, with an average of one per week, which shows that the franchise model is highly recognized in the market and favored by the owners.”
In conversation with HOTELS, Atiase spoke about replicating China’s success model, the brand’s emerging markets and incorporating new wants and needs in a post-pandemic world.
HOTELS: Can you update us on data: number of rooms open; number of rooms and hotels in the pipeline that are signed deals?
Stephanie Atiase: As of September 30, 2021, there are 3,022 Holiday inn Express hotels open globally (317,018 rooms) and 655 more hotels in the pipeline. Holiday Inn Express accounts for more than a third of IHG Hotels & Resorts’ global pipeline.
H: What makes Germany one of Holiday Inn Express’ top markets in Europe? Which other market in Europe are you looking to expand into?
SA: Germany is one of IHG’s key strategic priority markets and is Holiday Inn Express’ second-largest market (after the U.K.) with 44 open hotels and 21 new hotels in the pipeline. We also opened the first Holiday Inn Express & Suites in Germany at the end of last year in Potsdam.
IHG’s growth in Germany has been driven through a strategic focus on Multiple Development Agreement deals with selected partners executed by a local growth team who have a deep understanding of the lease-driven property market.
Holiday Inn Express currently operates in 20 European markets and other key markets include the U.K., France, and Russia. Last year, we opened our first Holiday Inn Express in Kazakhstan and in Austria and this year we will continue to launch in new markets such as Georgia and Corsica in France.
H: Can you elaborate on Holiday Inn Express’ success in China?
SA: Franchising helps Holiday Inn Express accelerate the signing volume and accelerate growth of the brand footprint in China.
It will take some time for the hotel market to fully recover [from COVID]. If we take a long-term view, we are still excited and optimistic about the prospect of China’s mid-range hotel market. The size of China’s middle class will continue to grow, the government’s policy guidance on promoting consumption and stimulating economic growth will continue to deepen, and various strategies for transportation network construction and regional development will continue to be promoted.These are important factors to promote demand-side growth. Especially in the vast second, third and fourth-tier cities and scenic spots, mid-range hotels will have great prospects for a long time.
H: Which new market are you concentrating on to replicate China’s success model?
SA: The brand continues to attract hotel owners as it expands to new markets around the world. For example, we’ve recently just signed our first property in Japan, the world’s third-largest travel market.
H: How much growth is coming through conversion and what are you doing to make Holiday Inn Express a more desirable conversion product?
SA: Since 2017, Holiday Inn Express signings have predominantly been new builds. Our strategy is to continue this trend while being opportunistic in our ability to convert existing hotels in locations where new development isn’t deemed to be achievable in the near- to mid-term.
H: How are supply chain challenges impacting development and how is IHG addressing this as best they can?
SA: Supply chain constraints are a global issue, and everyone in the industry is facing similar challenges. Every aspect of the global supply chain has been affected, from electronic components to lumber, delaying both renovations and new construction. We have been working with our partners across all aspects of the supply chain to find the right solutions for our hotels.
We know the key is to think ahead, we’ve learned that a “just in time inventory” mindset isn’t viable at this time. However, we believe the economy is strong, our industry is resilient, and we will overcome this obstacle as well.
H: The pandemic has changed the way people travel. What changes have you incorporated to address new needs and interests? Has the breakfast buffet returned in your hotels?
SA: The pandemic has done two things regarding travel — it has increased our appreciation for it and, for some guests, our apprehension with it. We have increased our investment in our service culture and digital products to ensure guests are delighted whenever they travel.
At all IHG branded hotels, cleanliness is top priority. Our longstanding commitment to rigorous cleaning procedures was enhanced at the outset of the pandemic with the IHG Way of Clean program developed with Ecolab and Diversey.
Breakfast is something we take seriously and guests love the diverse options at Holiday Inn Express. The enhanced breakfast offering provides favorite items, including signature pancakes, warm cinnamon rolls and our proprietary recipe for bacon. In response to growing consumer demand for healthy options, the breakfast menu includes items like Hormel turkey sausage, Chobani Greek yogurt, fresh fruit, and old-fashioned rolled oats.
The use of breakfast buffets varies across markets globally as different markets continue to be in a different place with COVID-19 and restrictions. However, where possible, we have re-introduced our breakfast buffet offering as it is a much-loved part of the guest experience. The Express Start breakfast is currently available across 94% of hotels in the Americas, with 6% under COVID regulations or planning a full return to breakfast soon.
H: What are you doing differently to attract more “bleisure” travelers?
SA: One of the positives that has come from a post-COVID-19 world are remote and hybrid work models. Most of our guests are choosing to work from our hotels. Since our hotels are located in almost every market in the U.S., we are finding guests taking adventure of longer stays that initially were leisure but due to our functional design, our guests feel comfortable working from the hotel during the week.
Holiday Inn Express recently launched its own TikTok channel, where we share aspirational content of guests traveling often for both business and leisure.
H: What’s next for the brand in terms of product enhancements, prototypes, etc.?
SA: Last year, we introduced the next evolution of the brand’s successful Formula Blue design and this is now available in select properties across the U.S., including Jackson, Georgia; Santa Clarita, California; and Fort Smith, Arkansas. The Formula Blue brings the now-familiar trademark elements of open check-in, enclosed breakfast bar, and guest room refreshment zone to hotel owners and travelers. Formula Blue 2.0 features a purposefully contemporary layout and has been the most popular design initiative in the brand’s 30-year history. It is now in place in over 1,100 hotels in North America. Formula Blue 2.0 includes refreshed public spaces with localized artwork and new guest room designs focused on delivering on a guests’ functional needs, more space, while provide cost savings for owners.
At our European properties, the focus has centered upon upgrading guest rooms with a ‘next generation’ design at all new hotel openings. It has been rolled out across two-thirds of the existing estate. Next generation guest rooms balance home comforts with smart design features, such as a flexible workspace, ergonomically designed chairs, ample USB ports and plug sockets, higher quality bedding and a Smart TV that enables guests to stream media from a personal device.