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Blog
Taking Holiday Inn Upscale
September 29, 2008
Can the original roadside family hotel--the same brand that in the 1960s touted free ice and free dog kennels--successfully rebrand itself as an upscale product after years of the same old same old?
FelCor co-founder and incoming IAHI Chairman Tom Corcoran thinks so: "It is my goal, and my expectation, that over the next two years, Holiday Inn will be moved in the minds of the public, our customers, and also our peers in the industry, to the upscale sector, as defined by Smith Travel," he said at last week's IHG Owners and Investors Conference in Los Angeles.
And IHG Chief Executive Andy Cosslett agrees, saying: "Moving Holiday Inn up a segment, to compete with Courtyard By Marriott and Hilton Garden Inn—I agree with Tom. I prefer not to classify the segment, but I share the principles and philosophy behind Tom’s point. We’re positioning Holiday Inn as a very different product than it has been for the previous 10 to 15 years. I think over time, [moving up] is a very good target to give ourselves."
What will it take to get there? Completion of a global rebranding effort that has already seen some 150 Holiday Inn hotels relaunched with new signage, new features and a new service culture (IHG plans to have another 500 Holiday Inns relaunched by the end of 2009; and hopes to complete all 3,200 properties worldwide by the end of 2010).
What would be the reward of a successful relaunch? Corcoran thinks a US$10 increase in ADR is achievable. And Cosslett says hotels that already have instituted the new service culture and moved to the new look and feel have seen success in being able to move rate, citing the Holiday Inn London-Heathrow as an example.
So what will be the ultimate test for IHG and Holiday Inn? It will come in the third and fourth quarters of 2009, after the launch of a major marketing campaign to introduce the new Holiday Inn. The main goal of that campaign, says IHG Chief Marketing Officer Tom Seddon, will be to "generate re-trial."
So the test first will be whether long-lapsing guests make reservations, and second, if they do, whether they continue to make reservations after the initial re-trial...
Only time will tell of success or failure, but until we find out through customer behavior, do you have a prediction on whether Holiday Inn will work as an "upscale" brand?
Posted by Derek Gale on September 29, 2008 | Comments (9)
In response to: Taking Holiday Inn Upscale
KEN shah commented:
LET US DO SOMETHING LIKE WALDORF=ASTORIA COLLECTION!!!!!!!GREAT IDEAS. KEEP ON TRUCKING...
In response to: Taking Holiday Inn Upscale
margaret commented:
Major uphill battle. It will take too long to get all the old, rundown properties out of the system. Those who do re-try may like it if they get a "new" one, but if they get an old one, why would they come back a second time?
In response to: Taking Holiday Inn Upscale
Johnny 5 commented:
Holiday Inn does have a reputation as an older brand and it certainly does carry such a reputation in the United States. But venture into some of the new Holiday Inns in Asia and you would be wowed. Clean and modern, with excellent service, they definitely redefine Holiday Inn. Now with tastes around the world rapidly changing, I believe Holiday Inn is correctly positioning itself to meet and surpass future guest expectations.
In response to: Taking Holiday Inn Upscale
David commented:
Lose the green colour or blend it down and yes it can fly.
In response to: Taking Holiday Inn Upscale
GK Rowe commented:
Ditch the green for rebranding. Why would you keep the heritage that boasted free ice, telephones in every room and tiled bathrooms in the 60s?
In response to: Taking Holiday Inn Upscale
B. Fantoli commented:
For sure a challenge, but we like it that way at IHG. Let' do it!
In response to: Taking Holiday Inn Upscale
Shane Kuber commented:
A challenge; the new IHG look can do it. Holiday Inn needs to come up with a signature breakfast to start. On the right track to moving Holiday Inn up a segment. Don't quit until accomplished.
In response to: Taking Holiday Inn Upscale
Jonathan commented:
It's going to have to be a 2-step process: first, the brand needs to delete substandard hotels at a rate that they (and no other hotel company) have ever done before. Then, the remaining hotels need to have significant improvements and additions to their facilities and services. Can it be successful? Yes, but it will certainly take at leasr 5 years to complete.
In response to: Taking Holiday Inn Upscale
GADtalk commented:
Holiday Inn is Re-Branding If an owner likes it or not. Hey it the right thing to do but wow they announced it right before a downturn started. Many owners may not be able to afford the changes required and the renovation dollars. I see that this is not a win win right now. Lets see if IHG tones it down or they stick it to the owners as they always do.