IHG brands - the Facts and Insights

Table of contents

IHG is one of the world's biggest hotel chains, with about 16% of global market share by rooms within the mainstream segment. IHG, like all other largest hotel companies—Marriott, Hilton, Hyatt, takes asset-light approach to grow steadily and rapidly. In boom times, asset-light models enable faster growth with lower capital investment; when recession hits, the models make the companies be less affected. As Simon Mezzanotte of Société Générale, a bank, explained that if revpar [revenue per available room, the industry’s benchmark] falls 1% at a hotel, its owner typically suffers a 5% profits fall. But the management fees (which are usually linked to a mix of the hotel’s revenues and profits) fall by 3%; and franchise fees (which are usually linked only to revenues) fall by only 1%.

Focused on high-growth industry segments and geographies, IHG's strategy involves strengthening established brands and capitalizing on opportunities for its brand portfolio; building and leveraging scale; developing lifetime guest relationships; and delivering revenue to branded hotels through the lowest-cost direct channels. Underpinning the entire strategy, it's business model and partnerships is a clear commitment to operating responsibly, brought to life through IHG culture and talented colleagues.

The global hotel industry is a $525bn industry, made up of 18 million rooms. 54% of rooms are affiliated with a global or regional chain (‘branded’), up from50% in 2012, and 46% are unaffiliated(‘independent’). The top five hotel groups, Marriott, Hilton, Wyndham, IHG and Accor account for 25% of market share, up from19% in 2012, and for 58% of the global development pipeline of hotels in planning or under construction.

Overview of global hotel industry

(a Source: STR, Inc; b Source: Oxford Economics)

Overview of global hotel industry

Hotel business models

There are two principal business models used by branded hotel groups:

• Fee-based, asset-light model

–– Franchised – owned and operated by parties distinct from the brand, who pay fees to the hotel company for the use of their brand.

–– Managed – operated by a party distinct from the hotel owner, who pays management fees and, if the hotel uses a third-party brand name, fees to that third-party also.

• Owner-operated, asset-heavy model

–– Owned – operated and branded by the owner who bears all of the cost but benefits from all of the income.

–– Leased – similar to owned, except the owner-operator does not have outright ownership of the hotel but leases it from the ultimate owner.

Asset-heavy business models allow tighter control over hotel operations, whilst asset-light models enable faster growth with lower capital investment.

The facts

Headquarters: Denham, Buckinghamshire, England, UK

Founded: April 15, 2003

Chairman: Christopher Marshall

CEO: Keith Barr

Locations: 100 countries and territories

Number of properties (including timeshare properties): 5,656

Number of rooms: 842,749

Frequent guest programs (Rewards program): IHG Rewards Club

Number of brands: 16

The insights

Luxury

Brand: InterContinental Hotels & Resorts

Properties: 200

Rooms: 68,000

Brand promise: From Michelin star restaurants to blending business and leisure travel seamlessly at each location, each InterContinental Hotels & Resorts property earns its reputation as a world class destination. This prestigious brand connects travelers with the authentic experiences offered in each of the 60+ countries in which it operates, delivering premium service in immersive luxury.

The echo: The InterContinental brand continues its strategic growth with 51 projects currently in the pipeline. Significant opportunities await in high-demand city centers and underpenetrated resort locations. The InterContinental brand won the prestigious World’s Leading Hotel Brand award for the sixth consecutive year at the 2014 World Travel Awards. Its unique market positioning between upper-upscale and luxury allows the brand to achieve luxury room rates while realizing lower costs to build and operate.

	Hotels	Rooms	Pipeline
Americas	51	17,892	5
EMEAA	107	32,388	29
Greater China	46	18,886	26
Global	204	69,166	60

*At March 31, 2019

Brand: Kimpton Hotels & Restaurants

Properties: 68

Rooms: 13,357

Brand promise: Chic boutique brand offering one of a kind hotel destinations with distinctive style and superlative service.

San Francisco-based Kimpton® Hotels & restaurants, acquired by InterContinental Hotels Group (IHG®) in January 2015, is the leader in individually designed and positioned boutique hotels and restaurants, providing a truly boutique experience by responding to the surrounding environment and delivering a guest experience that is authentic and reflective of the location. The approach to each property's design is individual to develop a concept that reflects the architecture, location, and neighborhood.

The echo: IHG® does not currently offer Kimpton franchises.

With nearly 60 properties in 30+ cities, having a track record of innovative hospitality that stretches back to it’s founding in 1981. Kimpton manage 100% of IHG’s estate with fantastically creative and dedicated sales and management teams.

	Hotels	Rooms	Pipeline
Greater China	1	129	4
Americas	64	12,421	16
Global	68	13,357	27
EMEAA	3	807	7

*At March 31, 2019

Brand: Regent Hotels & Resorts

Properties: 6

Rooms: 2,005

Brand promise: Regent’s strong tradition of impressive product and exceptional service, grounded in knowledge and experience, has built a brand that is trusted and sought after by owners, developers, employees and guests. Encompassing signature restaurants and spas, sophisticated residential developments and state-of-the art retail spaces, Regent’s growing portfolio of unique, bespoke properties remains true to the original Regent vision of creating the luxury hotel brand.

The echo: Regent Hotels & Resort is present in five countries with six open hotels including the award winning Regent Beijing, Regent Berlin and Regent Porto Montenegro and four properties due to open in the next three to five years in Hong Kong, Jakarta, Kuala Lumpur and Phu Quoc. IHG unveils Regent Hotels & Resorts' new logo and monogram in May 2019

Brand: Six Senses Hotels & Resorts

Hotels: 6

Rooms: 2,005

Brand promise: Local sensitivity, global sensibility. Part of the local fabric and culture, yet in tune with the wider world.

Responsible & Caring. Caring for hosts and local communities. Committed to preserving the environment and sustainable operations.

Crafted experiences. An all-encompassing and unique range of experiences to stimulate, energize and restore.

Pioneering wellness. Delivering the latest and most effective wellness programs and experiences in partnership with leading experts.

Emotional hospitality. An emotionally intelligent approach to service that begins with empathy.

Fun & Quirky. Aesthetics and experiences which are always unique, often unexpected and sometimes unusual. Delivered out of our constant curiosity and willingness to experiment.

The echo: In 2018, Six Senses Hotels Resorts Spas has been voted the world’s No. 1 Hotel Brand for the second consecutive year by the readers of Travel + Leisure magazine, the largest and most influential travel magazine in the United States. In addition, Six Senses Yao Noi has been named the No. 1 Resort Hotel in Southeast Asia.

Upper Upscale

Brand: Crowne Plaza Hotels & Resorts

Properties: 427

Rooms: 119,641

Brand promise: Productive spaces for the business traveler, relaxing places for leisure travelers.

The Crowne Plaza Hotels & Resorts brand caters to business travelers, who make up nearly 80% of its guests, by creating a setting that allows them to reach their goals. The brand offers exceptional solutions for conducting business by facilitating meetings, regardless of size.

The echo: The Crowne Plaza brand is the fastest growing upscale brand in the world and currently has over 92 hotels in the global pipeline. In addition to conversion opportunities, new build prototype designs are available to be scaled to market demand, meaning the brand is poised for continued expansion on a global scale.

	Hotels	Rooms	Pipeline
Americas	153	40,920	6
EMEAA	182	46,212	38
Greater China	92	32,509	44
Global	427	119,641	88

*At March 31, 2019

Brand: EVEN Hotels

Hotels: 10

Rooms: 1,551

Brand promise: A lifestyle hotel brand offering a holistic wellness experience that empowers the active, on-the-go traveler to maintain their daily routine while on the road.

EVEN® Hotels, the newest brand from IHG, meets the large and growing demand for a hotel brand to help wellness-minded travelers keep their balance on the road at an affordable price point. The brand serves as a travel partner for its guests, helping them feel better about their experience and themselves based on the choices they are able to make.

The echo: The EVEN Hotel brand is gaining momentum with the opening of the first two properties in Norwalk, CT and Rockville, MD. With three more properties in New York City in the pipeline, two in Manhattan and one in Brooklyn, the brand is showing potential for quick expansion. The brand will continue to look for opportunities in health conscious markets and plans to accelerate growth through the franchise model.

	Hotels	Rooms	Pipeline
Americas	10	1,551	10
EMEAA	0	0	1
Greater China	0	0	11
Global	10	1,551	22

*At March 31, 2019

Brand: Hotel Indigo

Hotels: 103

Rooms: 12,828

Brand promise: A refreshingly local approach to creating unique guest experiences.

The Hotel Indigo concept was inspired by the charm and service that boutique hotels provide. In each location, the Hotel Indigo brand offers a superior guest experience that incorporates the neighborhood story of the community in which it resides, while guaranteeing guests a level of consistency offered by IHG standards.

The echo: No two Hotel Indigo locations are alike. A flexible design concept allows for uncommon individuality and a uniquely customized experience that appeals to guests and owners. The brand is at home in city centers, urban, and strong suburban environments, and is currently expanding internationally in key markets, with 63 hotels in the current pipeline.

	Hotels	Rooms	Pipeline
Americas	58	7,567	38
EMEAA	35	3,756	40
Greater China	10	1,505	21
Global	103	12,828	99

*At March 31, 2019

Brand: Hualuxe Hotels & Resorts

Properties: 8

Rooms: 2,335

Brand promise: Dedicated to providing luxurious, close-to-nature surroundings and attentive, considerate service.

The HUALUXE Hotels & Resorts brand represents yet another industry first for IHG. This international brand was developed through knowledge of local tradition and in-depth research of Chinese consumers to appeal specifically to their way of life. These hotels will serve not just as accommodations, but also as a social venue that facilitates Chinese social and business interactions. All supported by the consistent quality, service, and standards of IHG.

The echo: Already the largest hotel operator in China, IHG sees the opportunity for the HUALUXE brand to make its way into over 100 cities there within the next 15-20 years, with 1 hotel open and 23 hotels in the current pipeline. Beyond that, HUALUXE stands poised to grow in cities throughout the world, offering the ever-expanding number of Chinese travelers a brand customized to their culture that will serve as a comforting respit wherever they travel.

	Hotels	Rooms	Pipeline
Greater China	8	2,335	20
Global	8	2,335	20

*At March 31, 2019

Brand: voco

Properties: 4

Rooms: 1,182

Brand promise: Drawing on our years of experience in delivering True Hospitality, voco Hotels, gives people a different choice. Hotels that are reliable enough to depend on, but different enough to be fun.

The echo: Launched in June 2018, this new distinctive upscale brand primarily focuses on conversion opportunities, offering owners of high-quality unbranded hotels the ability to combine the character of an individual property with rich guest experiences and IHG systems. The first voco hotels are already open in Cardiff and on Australia’s Gold Coast, with signings ahead of expectations.

Mainstream

Brand: Avid Hotels

Properties: 1

Rooms: 87

Brand promise: At avid™ hotels, we are championing everyday travel at a fair price, meeting the needs of the guests who all too often have to pay more for things they don't need, or compromise on the quality they expect. We're here to offer the type of hospitality they value most – the essentials done exceptionally well. Experiences that feel just right, every time.

The echo: Launched in September 2017, with signings in the US, Canada and Mexico, a development agreement in Germany, and one hotel already open. Priced below Holiday Inn Express, avid delivers the essentials exceptionally well at good value for guests, and provides owners with an attractive brand that’s efficient to build, operate and maintain.

Brand: Candlewood Suites

Properties: 399

Rooms: 37,464

Brand promise: Extended stay conveniences in a space that focuses on comfort and value.

The Candlewood Suites brand boasts occupancy rates exceeding traditional hotels for one powerful reason - value. This mid-scale extended stay hotel offers its guests the convenience and comfort desired during a long-term stay at rates comparable to many “standard” hotels. The brand is appropriately situated in markets with strong extended stay demand drivers, such as corporate, industrial, and suburban locations, making site selection a crucial factor for success.

The echo: An all-suite design that promotes guest independence and an operating model that allows each Candlewood Suites property to operate with just 12 team members - this model has been critical to the brand’s continued success. A fresh prototype design and standardized decor packages are provided to reduce costs and simplify the development process.

	Hotels	Rooms	Pipeline
Americas	399	37,464	97
Global	399	37,464	97

*At March 31, 2019

Brand: Holiday Inn

Properties: 1,186

Rooms: 215,714

Brand promise: A fresh, modern, and contemporary hotel offering, perfect for business and leisure travelers seeking comfort.

Holiday Inn hotels are midscale, full-service hotels that are known across the globe for comfort, value, and dependability. As the world’s most recognized hotel brand, Holiday Inn hotels host 100 million guests annually, thereby proving the popularity of the brand. In fact, 9 out of 10 travelers have stayed at a Holiday Inn hotel globally, more than any other hotel brand.

The echo: The Holiday Inn brand is an icon in the hotel industry, voted Best Mid-Market Hotel Brand in the World for 13 consecutive years with 3 guests checking in every second. Innovative design Inn ensures operational performance is built in to deliver favorable ROI for the owners. Significant opportunities await in high-demand city centers and underpenetrated resort locations.

	Hotels	Rooms	Pipeline
Americas	727	120,460	120
EMEAA	371	68,525	99
Greater China	88	26,729	49
Global	1,186	215,714	268

*At March 31, 2019

Brand: Holiday Inn Club Vacations

Resorts: 27

Villas: 7,927

Brand promise: The joy of lifetime vacations. Our Holiday Inn Club Vacations® owners are part of a community of people who understand the importance of family and investing in a lifetime of invaluable memories. All offer spacious villa accommodation for families in top leisure destinations, and access to world-class attractions such as mountain adventures, championship golf courses and serene beaches.

The echo: More than 340,000 families now make the Holiday Inn Club Vacations brand the choice for vacation ownership. Continuing its impressive growth, the brand welcomed its 27th resort in 2018, further enhanced brand standards, renovated more than 1,000 villas, and introduced attractive benefits to enhance the member experience.

Brand: Holiday Inn Express

Properties: 2,742

Rooms: 282,050

Brand promise: A fresh, convenient hotel offering comfort and value.

The echo: Since its launch in 1991, Holiday Inn Express has grown to more than 2,400 hotels and continues to be one of the fastest growing brands in the world. Holiday Inn Express' design model decreases build costs, minimises consultancy requirements, reduces time to market and maximises the use of revenue generating space to deliver a dynamic experience for guests.

	Hotels	Rooms	Pipeline
Americas	2,294	207,412	493
EMEAA	306	43,972	112
Greater China	142	30,666	185
Global	2,742	282,050	790

*At March 31, 2019

Brand: Holiday Inn Resort

Hotels: 46

Rooms: 11,561

Brand promise: The joy of family holidays. At Holiday Inn Resort® we want all families to experience the joy of great holidays together.

In some of the world’s most desirable locations; on the beach, by the theme park, next to the golf course, our resorts offer a wide variety of activities and comforts from kids’ clubs and signature swimming pools, to informal restaurants and quiet fireside lounges.

The echo: Guests enjoy amenities such as multiple food options, whether poolside or in a restaurant, swimming pools, fitness centers as well as tailored services for children such as KidSuites® Rooms and a Children’s Activity Program. All Holiday Inn Resort properties also offer nightly on-site entertainment from live bands and karaoke to comedy shows.

Holiday Inn Resort hotels meet the consumer demand for Holiday Inn hotels in leisure markets with resort style amenities. With 19 hotels in the current pipeline, the brand continues to expand in key leisure destinations around the world, evidence that both owners and guests alike recognize the value that the brand has to offer.

	Hotels	Rooms	Pipeline
Americas	23	6,176	1
EMEAA	16	3,390	12
Greater China	7	1,995	7
Global	46	11,561	20

*At March 31, 2019

Brand: Staybridge Suites

Hotels: 282

Rooms: 30,799

Brand promise: Upscale extended stay all suites hotel offering a break from the travel norm.

The echo: The Staybridge Suites brand is popular among extended stay travelers, with its spacious suites and welcoming, refreshing experience. This popularity enabled it to reach growth milestones faster than any other brand in its segment. By continuing to cater to the needs of extended stay travelers, this brand is positioned to continue its growth momentum.

Identifying high-potential growth markets with strong extended stay demand has been key to the success of the Staybridge Suites brand since its inception. The brand utilizes newly-updated brand decor packages for consistent quality and proven appeal.